Four Big Issues for CIOs

This week our #CautionaryCanadian turns his attention to CIO.com’s article about the 12 (or eleven) biggest issues facing CIOs today which you can find here. While not covering all eleven issues, he addresses the four he finds most interesting at the moment: data protection, skills, innovation, and business results.

As always, please let us know what you think in the comment section or with a quick “like.”

Thanks!

Introduction

The article starts by framing the issues it’s going to cover, including a reference to the evolving importance of data and AI. Of course, data volume has been growing exponentially in recent years and, as this week’s article attests, this growth creates new challenges for IT leaders. Coupled with increased news of data breaches and mounting legislative attention on privacy comes heightened concern for data protection. While this is becoming a top of mind issue, there continue to be other concerns of similar gravity when it comes to “data” that we must not lose sight of.

In this blog, I’ll offer my perspectives on this and other items of interest covered in the article affecting CIOs and their teams. But not twelve (or the eleven that are actually in the article) topics! There’s too much spaghetti being thrown at the wall! Let’s deal with only four topics this week: data protection, skills, innovation, and business results.

Data Protection

Data about clients (or customers) has always been key to a successful business. In the past, data was primarily focused on how clients did business with you, how your business needed to respond, and, of course, basic accounting. Recently, focus has been shifting to how clients interact with your firm through various channels and how you can use these channels to drive new business or better target your client’s buying habits. Looking forward, sensor data will become available through IoT devices and new insights will be mined about clients-in-motion. All of this data needs to be managed. I suggest that “manage” in this case means more than just data protection. Data needs to be stored knowing some of it requires frequent access while other data less so (tiers of storage to manage storage cost). It needs to be backed up. You might replicate some of the data to improve availability during hardware or software failures. You need to be able to mine it to find business insights. Data exists in multiple formats (like images or unstructured text) that demand new tooling to process it.

One of my favorite data topics has to do with data quality. Having spent many consulting engagements collecting and analyzing my client’s data, I can say with confidence that data quality is a key issue. We do not spend enough energy ensuring our data is clean. This is not only wasteful of IT resources; it also leads to challenges determining the “authoritative source” of data. Given the importance of data, there should be greater emphasis on data as an enterprise asset. Clients often agree as they create new leadership positions such as “Chief Data Officer.”

The Skills Gap

For the many years I have been consulting to clients, one of the key challenges for CIOs has been access to the quantity and quality of IT skills required to meet their business need. As with the data discussion, there are a number of dimensions to this. One strategy has been to outsource or out-task services to contractors or firms. This gains access to a larger skills pool, perhaps for interim purposes. It allows the CIO to direct his or her team to more strategic areas where institutional knowledge can offer an advantage.

Diversity in hiring procedures has also broadened the skills pool, with the added advantage of bringing new perspectives into the IT department that can generate new opportunities. One CIO I worked with said “even if I had unlimited funds, I still could not hire all the people I would need … therefore I need to have my team shift from managing technology to managing projects with a higher percentage of contractors.” An interesting perspective on skills!

One of my pet peeves is how much the technology industry favors the younger employee (read into this high energy plus low cost) as well as the significant cost incurred with the brain drain of seasoned veterans. Other professions value years of experience for good reason. I believe a more balanced approach that blends both youth and experience yields better results, and clients seem to agree with this.

Innovation and digital transformation

Context matters, especially for this statement like this one made in the article: “The cost structures and process efficiencies of legacy versus a nimble digital capability are much different – nimble is less expensive and much more efficient [emphasis mine].” I am sure there is a context where I could agree with this statement. However, as expressed in the article, I am struggling with how damaging a statement like this can be when the context is left unexplained.

For starters, the reason so-called “legacy” is often far more efficient and cost effective when compared to new digital capability is that legacy is tried and proven over time while a new digital capability is still evolving. Given time, the new capability, whether digital or not, will improve and, perhaps, become more efficient and cost effective than some legacy capability it replaces.

One would hope that technology keeps getting better and whatever we build with newer tooling will ultimately be that much better as well. If history is any judge, we can be confident that this will hold true. Even so, we should be mindful that history has also taught us that new things often come with new bugs that need to be worked out. I had one client that had a team of developers really devoted to agile methods who delivered an application in record time using the latest technologies and methods. After a few months in production, however, performance issues started to occur and the business impact became severe. The development team was unable to diagnose root cause, in part because during the development they spent insufficient time understanding what was happening inside the application as it executed. They thought this extra time would have compromised their agile schedule! This is one case where the cost structures and process efficiencies did not favor the nimble.

(The relentless drive for) Business Results

This section of the article states: “We frustrate our talented resources with solvable problems that are rendered completely impossible in our companies by momentum.” Here is a statement I most heartily agree with. There are so many instances where the pace set by the business has driven unfortunate downstream consequences not only for the IT department but also for the business itself. I made a pretty good living being called in to fix situations gone bad. In many cases, the cause was the relentless march of the business and the corresponding demands placed on the IT department (and the shortcuts that ultimately had to be taken). How many CIOs today will stand up to their business peers and their CEO/CFO and say “you can’t have that as quickly as you would like” and “my IT budget needs this percentage of funds to keep things in good order” (which, by inference, means fewer funds and skills devoted to what the business values)?

I had one client who was so impressed with the outcome of a 12-week assessment of their outages that I was asked to return on a retainer basis to help them with operational excellence (something I called out as a root cause). A few months later, however, it was once again “all hands on deck” to implement a new business service. By then, the people I had worked with had evaporated and I was left alone to implement their operational effectiveness program. Well, that wasn’t going to happen!

Conclusion

At some point I may get a chance address some of the other items explored in this article. Rebuilding trust is a great topic as is the distraction of CIOs’ finding new revenue streams along with innovation and digital transformation. In this article, though, I’ve been able to cover data (data quality), the many dimensions to the skills gap, the importance of context especially when debating legacy versus new, and the consequences of the relentless drive businesses place on their IT departments.

Based on reader comments, I could drill deeper on any of these where there is an interest. If there is one lesson I learned that is essential in many situations, it is “context is important”. Taking the time to understand an issue in greater detail can lead us to different conclusions, and this might be key to a business outcome.