CIOs evolving to become ‘chief digital officers,’ focused on entire digital footprint rather than just IT
Those who don’t make this transition could be replaced; those who do must become much more strategic
IT'S no secret that the role of the chief information officer (CIO) has been evolving over the past few years as information technology (IT) becomes more central and strategic for many enterprises today.
However, not all CIOs may be able to do this effectively, and those who are struggling to transition their roles from being operational to one that is strategic should consider making way for those who are able to do so, according to an analyst and an industry player.
Speaking to the media on the sidelines of the MSC Malaysia Cloud Conference on Oct 9, Darryl Carlton, research director at Gartner, said today’s CIOs should not be concerned with operational issues such as what software release of Microsoft Windows their business is on, but rather on business-related issues like how well their business is serving their customers.
The MSC Malaysia Cloud Conference is an official satellite event of the 4th Global Entrepreneurship Summit held from Oct 11-12 at the Kuala Lumpur Convention Centre.
Other satellite and partner events in conjunction with the summit include the Global Startup Youth or GSY initiative; the Ideas2Invest ‘hack-celerator’ organized by Cradle Fund Sdn Bhd and Angels Den Asia; the CIO Leadership Summit organised by the National ICT Association or Pikom; the launch of Microsoft Malaysia’s Innovate for Good youth empowerment programme More information can be found here.
Carlton (pic) said the research firm has in fact coined a new, all-encompassing term to represent the ‘new CIO,’ which is the ‘chief digital officer (CDO).’
He said the CDO title reflects a new and growing digital footprint, which many of today’s CIOs have to face simply because their interaction with their stakeholders is far more extensive than before, especially in the age of cloud computing.
“The term ‘CIO’ has come to mean IT support for an internal organisation,” he said at the media briefing. “[However], this shouldn’t be the case as we’re seeing a shift in a CIO’s responsibility towards a far broader view than just the person who is responsible for IT within the company.”
Chakib Abi-Saab, chief information officer of Bumi Armada, concurred with Carlton, noting that IT should not be about supporting servers or software upgrades but rather about creating competitive advantage for the business. Bumi Armada is a Kuala Lumpur-based offshore oilfield service provider.
“When I first joined [Bumi Armada], the company was upgrading our enterprise resource planning (ERP) systems,” he said. “When it was completed, an email was sent out stating that we were upgrading from version 4.x to version 4.y. That meant absolutely nothing to the business users [especially the C-levels].
“If we use IT properly, we will be able to identify technologies that can help our organisation to be better, faster and cheaper. This will create a competitive advantage especially with the use of cloud computing. This is what C-Level executives want to hear and this is what CIOs must be doing.”
Change or be replaced?
Despite the clear trend that CIOs must become more strategic and less operational in their job scope, many of these executives are still struggling with making the switch in roles, a challenge that both Carlton and Abi-Saab readily acknowledged.
Asked what can be done to begin to address these challenges, Gartner’s Carlton conceded that it is a tough question to answer, as you can’t necessarily change those who don’t want to change.
"In some ways, a CDO is what a good CIO has always done, so it’s not any different," he said. "But if somebody is pathologically focused on running IT, perhaps they can’t be the one in charge [as a CIO],” he said, adding that these kinds of technically focused people are however still very much needed in today's organisation.
Carlton also suggested that for CIOs who are at the crossroads of their careers, they would need to somehow make this transition and focus on business, strategy and outcomes.
For Bumi Armada’s Abi-Saab (pic), it’s a question of being tactical versus being strategic.
“When we have CIOs who come from a technical background, one of the challenges they face is that their approach to the jobs are very day-to-day, tactical in nature; but in reality the true role of the CIO should be strategic.
“[But] I have to be a little hard here; if there is a CIO who is not able to understand this, doesn’t have the ability, or doesn’t want to change, he just has to be replaced.”
Notwithstanding this, Abi-Saab noted that the difficulty in becoming more strategic has been exacerbated by the fact that IT personnel have never been good in making themselves seen as valuable by top management, compared with other positions within an organisation.
“IT [people] work very hard and sometimes harder than their counterparts in business but many people do not realise this,” he argued. “The reason why people don’t realise this is because IT [people] have failed to market themselves in what they do, and they have failed to show the value they add to an organisation.
“They need to change this by positioning themselves as executives who can understand the business needs and can translate those needs to IT implementation so that they can been seen to be proactive and are able to provide the solutions before the need arises.”
Abi-Saab also suggested that organisationally, the CIO's position must be elevated to be a part of the board of directors so that they will have the ear of the CEO when making strategic decisions.
Increasing cloud uptake
Meanwhile, the country's ICT custodian the Multimedia Development Corporation (MDeC) believes that the cloud computing uptake in Malaysia through the MSC Malaysia Cloud Computing Enablement Initiative (MMCCI) has been growing steadily.
According to its chief executive officer Badlisham Ghazali, the cloud can be considered the ‘new normal’ in the Malaysian ICT industry as the nation moves closer towards providing the right ecosystem and building blocks for cloud adoption in both the enterprise and small and medium enterprise (SME) space.
In his keynote address at the conference, Badlisham said the MMCCI, first launched in 2011, has now seen the 115 independent software vendors (ISVs) approved, contributing close to RM16.1 million in revenue as of last year. With more ISVs coming on board in 2013, MDeC expects this number to reach RM20 million by year-end.
[RM1 = US$0.31]
“SME uptake of the cloud driven by our programmes has increased significantly, with RM2.55 million disbursed to 1,700 SMEs under the SME Cloud Computing Adoption Programme,” Badlisham (pic) said.
“In fact, 60% of these SMEs have also renewed their subscriptions upon expiry of the incentive period with their own financial investments, thus proving the sustainability of this programme,” he claimed.
Besides this, Badlisham said cloud subscription contributed an average of 42% to total company revenue for MSC Malaysia companies under the MMCCI in 2012, something that is expected to increase to 46% by the end of 2013.
“Moving forward, MSC Malaysia aims to consolidate all present and future software-as-a-service (SaaS), platform-as-a-service (PaaS) and infrastructure-as-a-service (IaaS) offerings of MSC Malaysia-status companies and existing partners under a single portal for more efficient marketing.
“It will also enable resources to be harnessed more efficiently as we bring more players into the programme. Apart from this, the MMCCI is also looking at connecting to other regional and international clouds to extend the reach of our partners into new markets.”
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