Innovation Inquiry 2015 Harnessing digital disruption

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We are delighted to publish a new article written by Roger Camrass, a visiting professor of Surrey University and ESADE Business School with over 30 years of experience as a consulting partner and business executive. Roger Camrass is is the author of ‘Atomic: reforming the business landscape into the new structures of tomorrow’ and a graduate of Cambridge University and MIT.

As part of his research he conducts annual inquiries into issues that are on top of CIO agendas. His most recent inquiry on Innovation “Harnessing digital disruption” is based on findings gained through face to face interviews with senior IT and Business executives. You can read the full article below:

During 2014 Roger Camrass interviewed over fifty senior executives from Fortune 500 and FTSE250 companies such as Ford, Bank of America, BP, BAT, Eli Lilly, John Lewis, esure and Tullow Oil. His findings suggest that the CIO community face today a duality of disruptive forces – at the back end where the sourcing of IT services is undergoing radical change, and at the front end where the competitive landscape is being transformed by digital technologies such as cloud, big data and mobility.

The 2015 Innovation report concludes that in a period of such radical change CIOs can become key contributors to business success by exploiting their unique knowledge of digital technology and associated development methods such as lean start-up and agile development. However, hard choices need to be made as to where the majority of effort is focused – front or back end, and how IT can engage effectively with its peers to help innovate traditional business thinking and practices.

The Inquiry was conducted in association with the Surrey University ‘Centre for the Digital Economy’ (CoDE) and CIO Connect Ltd. Here is a brief summary of our findings.

1. Digital is now disrupting all sectors

Despite a false dawn in early 2000s during boom and bust, Digital is now ubiquitous due to the ‘mass consumerisation’ of IT devices and associated developments in cloud services. Our interviews illustrate the broad scope of disruption across all key commercial sectors, and the associated levels of uncertainty that this implies:

digital disruption

Although such disruption is frequently self-evident, many CIOs commented that their peers at board level were not taking the necessary steps to reshape the business. For example, the CIO of a leading building material company pointed to the likely impact of 3D printing on the entire construction industry. However he admitted to being relatively isolated in determining how this might affect his business.

2. Digital is also disrupting corporate IT services

The recent dramatic decline in IBM’s fortunes points to the fallibility of traditional outsourcing methods and strategic IT relationships. The IT sector itself is undergoing its own radical transformation. For many of the organisations we interviewed the notion of a long term strategic IT or business service partner has become almost irrelevant. Instead CIOs and COOs are acquiring IT, HR, CRM and other such business services through cloud vendors such as Salesforce and Workday on a ‘plug and play’ basis. Tactical supply is replacing strategic partnerships.

Our interviews reveal that the scope and nature of IT service provision is changing rapidly with the advent of cloud, big data, social networks and mobility:

digital disruption

The role of the CIO and enterprise IT is changing as a consequence of such developments. The CIO of a leading insurance group indicated that he had just appointed a service integrator to take over the entire IT operations so he could focus on developments at the front end of the business such as mobility, social networking and big data.

3. Implications for Digital Leadership

In the face of digital disruption on two fronts (front and back ends), organisations are choosing to split IT leadership into two components – Chief Technology Officer (looking after IT operations) and Chief Digital Officer (responsible for digital strategies and related business innovations). We see this as a short term fix rather than a durable leadership strategy. Our overriding conclusion based on 50 face to face discussions is that the CIO needs to rise above the current noise level to become a primary influencer in the transition to becoming a digital business.

Our survey identified multiple ways in which CIOs today are helping to mobilise their peers to innovate business – segmented by levels of ambition, from ‘protect the core’ to ‘create the new’:

digital disruption

For example, the CIO of a leading UK retail group has raised funds from his Board for five successful ‘silicon round-about’ start-ups that could help transform the way retail is conducted in the future.

The emerging CIO agenda contains a range of critical elements:

  • Developing a digital road-map in conjunction with executive peers that recognises the competitive threats and opportunities facing any organisation today
  • Reviewing the way corporate services are procured in a cloud era, with a focus on cloud brokering rather than outsourcing of such resources
  • Mobilising communities of change within an organisation to undertake innovation programmes through hot housing and executive education
  • Applying agile tools that can reduce development life cycles from years down to weeks or months to align with a fast moving competitive landscape
  • Acquiring and implementing end-to-end innovation processes to translate compelling new ideas and approaches into sources of sustainable business value

4. The Role of Surrey Centre for the Digital Economy (CoDE)

Surrey University has created a new centre dedicated to helping senior executives and their teams bring innovative methods, techniques and partnerships into their organisations. We combine active research into emerging digital technologies such as 5G and the Internet of Things with executive education to help inform businesses about possibilities and threats. We use new techniques such as online learning to broaden exposure to digital across an ever growing community of interest.

The Centre is also becoming the UK’s leading hub for co-development, bringing together large corporations with small highly innovative companies to design and test out new business models and associated commercial offerings. In this respect we are helping to transform cultures and executive mentalities to align with the world of ‘open innovation’.



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