Our perception of digitalization

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Our perception of digitalization is a result of all our experience is this practice – spiced with mindset and knowledge. It is our perceptions, through our personal lenses, that define how we view and address digitalization, and business effects we get. Our perception needs to change in the same rate as the digital evolution and it can be a painful journey with out the right support. What lenses do you use to with IT and digitalization?

Our perception of life and circumstance is a reflection of our experience and mindset. Our perception teaches us what is good and bad – and what we can trust. Memories of bad (and good) experience are stored in our mind and use to perceive and evaluate situations. It is one of the key functions of the amygdala part of the brain to translate senses into emotions and actions/decisions – all driven by experience, knowledge and mindset. Our “lenses” of circumstance guide our way through life and help us to make the right decisions. How does this relate to IT and digitalization?

The way we view a brand or product/service is often in the light of previous experience and how they relate to our values and needs. In the same way, the way I perceive digitalization or the role of IT is a summary of previous experience and mindset relating to these practices. I have worked in this domain for 15 years and during this journey I have changed my interpretation gradually based on own experience, inspirations, and new insights. It has been a personal journey where my own principles of IT have been challenged in its core. To change your perception is sometimes painful (I know) but necessary to keep up with evolution. However, some see digitalization as a pure technical trend while others see it as a complete game changer addressing culture and leadership. It is hard to argue that some interpretation is better than others – it is a matter of opinion and mindset. Everything we see is tainted in someway by experience and mindset.

We perceive digitalization in different ways based on our experience – and it hard to say what is right or wrong. 

I often meet “traditional” CIO who has been in the IT industries since the mid-90 with a technical career mastering technology, projects and processes. It was a time where the role of IT was to improve business productivity through cost reduction and automation. A cost efficient IT was a successful IT organization! A career was based on delivering annual productivity gains with limited risk – often through large projects (not always successful) and utilizing smart use of IT. As long as IT was “just” a productivity enabler located in the corner of the organization chart – it was an ok approach since very few understood what IT was about. My concern is that relating to how digitalization is perceived through productivity and technology lenses? How does it look like? How does it smell and feel? Do they see the same picture as business and customers?

In my work as a Senior Advisor to CIO, I often meet CIOs with the productivity glasses on when they discuss IT. They tend to talk the language of digitalization but in the end view it from a technical and productivity perceptive. There is no right or wrong answer – but my main finding is that the CIO perceptive on digitalization is not aligned to how business or customers view it. They see different things! They don’t speak the same language! They rather see disruptive IT trends affecting their business model, fast moving change and need to satisfy the digital customer’s expectations. This is not strange in anyway considering the history and experience of CIOs.

My job as a Senior Advisor to a CIO (and senior IT managers) is to change their perspective on digitalization – giving them a new set of glasses to view the world through. To see the digitalization from a business (and other) perspective and how it affects leadership, governance and capability needs in the IT organization. Today, it is not about productivity but rather how the CIO can ensure business competitiveness and revenue growth through smart use of IT. All business models in the future will depend on IT – that is a fact!

Some time ago, I worked with a CIO to coach him to master the digital journey and how to create better digital support to business. The industry was changing rapidly and the voice from upper management was getting louder and louder forcing the CIO to build digital strength. What I noticed in our discussion was that the CIO continuously viewed digitalization from a productivity and technical perspective. We discussed digitalization for many meetings and tried to view it from different perspectives. How does our kids see digitalization? How does a specific business executive view digitalization? How does your IT management team view digitalization? We agreed that there are different perceptions (lenses) depending on your experience and mindset. We agreed that there is no right or wrong interpretation. We agreed that he (CIO) needed to understand and acknowledge all different perspectives to support business in the best way. Great! We discussed what “value” actually was and how to change the mindset of his management team. We discussed how IT management teams looked from digital and business oriented perspective. I could tell that he had started his personal journey to something greater – to change his perception of digital. After some time I returned to the CIO and IT organization and experienced a new IT aligned with business striving to digital growth. What they did is a different story – but it was fantastic!

The example is not unique. Digital transformation is mainly a mindset journey to change our perception on IT, business, customers and digital. It is a painful journey where our beliefs and principles will be challenged! If we view business with IT glasses from 1996, then we don’t see the true meaning and challenges of digitalization. The successful digital companies are those that has embarked on a new path beyond the beaten tracks and learned that digital possibilities are enormous – as long as they have the right glasses on.

Digitalization has many definitions depending on how the concept is viewed and perceived. Since the concept was first launched 5-10 years ago, the concept has changed because we have experienced the affects and its evolution. To keep up with the digital evolution we need constantly challenge ourselves to upgrade our glasses to see the concept in the right light – otherwise we are stuck in the trenches of digitalization without moving forward. It is a personal journey that is painful – but worth it.

  • Hans Gillior – Senior Advisor in Digitalization

The art of transformation – all about mindset!

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“It is like changing the engine of a car running at 100 mph on the highway” the CIO said. His face was filled with frustration and worry as he reflected on how his IT organization needed to change. “It is not possible – and I will tell you why”.

The quote from a CIO located in Sweden is not an uncommon way to express the challenges of IT going forward to address the digitalization. It is a challenge of transforming the core capabilities of IT to meet the future demand and at the same time, uninterrupted, deliver value to business in a cost efficient way. An impossible mission what most CIOs are facing today – and keep many CIOs awake at night. But how is this even possible? The answer comes from somewhere unexpected.

The basis for the quote was actually a discussion about how digitalization is affecting the CIO’s IT organization. During the last 10 years, the purpose and mission of IT has change drastically to address business and customer expectations, rather than providing cost efficient operations. Cost efficient operations (operational excellence) were the purpose of IT before digitalization when business and customer demand was predictable and stable. We could then build operating models and process to maximise efficiency with a long-term perspective where demand was stable and constant. In this pre-digitalization environment, people where recruited and organised to optimise efficiency – in a stable environment with complex processes and operating model. Every penny counted! Today, it is different! We no longer have a stable business environment and efficiency no longer counts – today it is about flexibility and agility! IT needs to react fast to changes in the industry and guide business towards products and business models. That is the reality of digitalization!

“No, it is impossible! You see, I have a set of resources (mainly service managers) and way of working, and we cannot just replace it over-night with business and innovative oriented way of working. It is what we need to do – but it is not possible! We have to live with staff and capabilities we have.”

So, what do we do? The answer is easy – nothing! Studies show that most IT organization fail to react to digitalization in the right way (digital transformation) but rather focus more on what they are good at – more processes and cost control. Doing the same thing and expect different result is not a good strategy going forward. We also see that many CIOs are waiting for a moment to peace and calm to run the transformation – after the next re-organization, cost cutting initiative or business strategy workshop. Sorry, but peace and calm will no longer exist! The fact is that business demand will never again be stable and predictable but rather changing with various levels of speed and magnitude. That is the current characteristics of digitalization.

A couple of years ago, I spend some time in Japan to finish my master thesis. Next to my apartment, there was a convenient store called Lawson and they had as a strategy to constantly change their products and services to maximize the customer experience and revenues. Products not selling enough were immediately phased out and new products replaced the old ones. New products and services where constantly tested and evaluated. Speed, change and learning were the core capability of the convenient store. Frankly, going into the store, you never knew what you would find – only that it was the best and most interesting stuff. Lawson was an expert of determining what delivered value and experience to their customer (fast changing requirements) and focused on re-allocating resources to optimize value-creation. Great stuff!

My point of view is that the digital challenges that IT organizations face today are mostly in our minds. We have been taught over the years how to run and change an organization and when we face challenges stretching the boundaries of our experience and imagination, we fail to respond in the best way (sometimes at all). But there are examples of organizations that succeed to manage continuous change – going 100 mph on a highway – mainly because they have an uncompromised view of the new role of IT. They have challenged their comfort zones, the traditional way of working and acknowledged that change is here to stay. They are also great at marketing the new role of IT in the company and educating key stakeholders about how digitalization is affecting business and IT. It is all about leadership in terms of attitude and challenging everything you know and believe in. Yes, it is possible! By stating that change is impossible – you have already failed.

I fully understand the reaction of the CIO that I interviewed. Reality can seem hopeless with endless (contradictory) demand from business, finance and HR – but who said it would be easy? A good starting point is actually to understand what activities that deliver value – and what does not. Focus on re-allocating resources to where value is created and find alternative methods to deal with non-value adding activities (outsourcing or terminate). This is not a method but a mindset that must influence everything the IT organization does – and the learning/adjustments must be done in rapid pace. When a CIO tells me that they are not able to change – it tells me that they do not fully understand how they create value. They are then locked up in their own comfort zone far from where value is created.

My recommendations:

  • Understand what activities that create value to your business counterparts and customer – but also what does not create value.
  • Challenge your own comfort zones! That is the biggest hinder to your success!
  • Understand the new role of the IT organization in the digital environment – and stick to the new role in an uncompromised way. Follow your believes!
  • Contact Hans Gillior and Sofigate – we are experts on digital transformations of IT/Business organizations. We deliver results, value and change!

During the last 10 years, digitalization has been all about new technology, social media, mobility and new exciting tech-companies revolutionizing the business landscape. Does new technology strengthen our competitiveness? Yes, but only momentarily. Digitalization 2.0 is about leadership, mindset and innovative management methods. It is a way to react fast to disruptive trends and opportunities/threats in the market. It takes an IT organization approximately 18-24 months to react to a change utilising traditional IT governance style. How much damage/change has Google (or other digital giants) been able to achieve during that time in the market? It is all about mindset and change management! IT transformation is possible – but only if you believe in it, and are willing to accept the new rules of digitalization. Success is in your hands!

Hans Gillior – Senior Advisor (Sofigate)

hans.gillior@sofigate.com – hansgillior.wordpress.com – @digitalgillior

 

 

 

 

Go beyond IT Strategy

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If Google would launch a new IT service today competing with your current offerings, how fast can you (IT organization) respond to the new competition? If you react slower than 6-9 months – your will most likely not survive the new rules of digitalization. Game over!

Summer is upon us! It is the time for many IT organizations to validate or review its IT strategy. It has to be updated to ensure that It provide the right priorities and capability for business in 2017 – and ensure business success. It is, without a doubt, the most important period during the year to set the agenda and ambition for the coming year. The annual strategic planning process has been used by many IT organizations during the last 20-30 years with great success but how valid is it today? Has digitalization changed the way of working in the strategic planning process?

A couple of years ago, I was asked to run an IT Strategy project for a company in the eye of the digital storm. It was obvious that the future of IT and business was very unpredictable and we did not have any idea of how the competitive situation, technical evolution, customer behaviour and political directives would look like in the next 2-4 years. All of these parameters need to be taken into consideration when addressing an IT strategy assignment. What do these parameter mean for IT? What IT capabilities are needed to drive business success in such chaotic environment?

Traditionally, IT strategy describes how IT delivers value to business in a coming a 3-5 year horizon. But if we do not know the business climate going to look like in the next 2 years, how can we define what IT capabilities and prioritizations we need in the next 3-5 years? The fact is that during a lifeline of an IT Strategy, most of the time, it hinders business competitiveness because it is based on old assumptions. In some cases, where business is changing very rapidly (for example banking, media, gaming and telecom), the IT strategy is invalid when launched. It does not reflect the current competitive situation and technical evolution but rather how it looked like 12-18 months ago. What has happened since then?

No, the current strategic planning process (based on annual cycles) is no longer valid in IT intensive industries. We see company calculating a reaction time of 18-24 months to a new trend/competitor due to the slowness of the strategic planning cycle. Ask Google or Apple what they can do in that time? And believe me, they know exactly how to take advantage of the situation. Many companies are like sitting duck waiting to be conquered – because the reaction time is too slow.

The question is what we do about this. Is there another way? Yes, obviously there are modern ways of go beyond the “old” tracks of IT Strategy and planning processes. The new way of working is based on enabling excellence cognitive skills (better analysis and excellent decision making) – based on accurate information and knowledge. It is about continuously challenging the current priorities and principles for IT strategic management – in fast pace. It is all about going beyond IT strategy and actually being an integrated part in business with focus on value creation.

My recommendation is to consider how fast your IT organization reacts to change in the market. If Google would launch a new IT service today competing with your current offerings, how fast can you respond to the new competition? If you react slower than 9 months – your will most likely not survive the new rules of digitalization. Game over! This might seem like a odd experiment but actually provides a good stress test of your IT organization. It will indicate whether you are prepared for digitalization or not.

Recommendation:

  • Do the Digital stress test and question what is the root cause for the fast/slow response time. What is the impact of the slow response time? What does this mean for other areas of IT – for example sourcing, operations, development?
  • Start questioning the traditions methods for IT Strategic Planning and Follow-up. Today, it is all about fast reaction, cognitive abilities and knowledge management. Do you have the right capabilities for survival in the digital era?
  • Contact Hans Gillior at Sofigate. We are experts on agile IT strategic planning and ensuring optimal business value creation over time.

Summer is here. It is a time where many IT organizations develop an IT strategy for the coming year to define how to deliver value to business. The fact is that the traditional approach to IT strategy and steering is old and not adjusted for digital markets. The IT strategy will, with all certainty, be invalid when launched – meaning that a majority of 2017 will be run in complete darkness. We need a new approach! We need to open our eyes during the year! We need to change to survive another year of digitalization.

Hans Gillior – Senior Advisor and Digital Evangelist (Sofigate)

Comfort zones – greatest threat to digitalization  

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A majority of the Fortune 500 companies will not survive digitalization. Enormous amounts of revenue and customer value will be transferred from traditional companies (traditional governance structure) to digital companies (agile governance structure) where value, time and leadership plays a pivotal role in the managing the IT department. It is all about our personal journey and challenging our comfort zones!

A couple of years ago, when I started my journey into the territory of digitalization, it was quite a new concept and not really in focus of the IT department. I remember a conference in September 2013 discussing IT Governance 2.0 where 99% of all discussions referred to traditional IT management and traditional decision models. I was the ”odd duck” at the conference speaking on the real affect of digitalization and how IT management must join the digital movement with new way of working. “Interesting thoughts but not really valuable for us” was a general comment after my speech. Today, almost three years later, digitalization is on top of each CIO’s agenda. Still 90% of the discussions at conference and forums are from a traditional IT management perspective. There is a belief that we can achieve different results (digital growth) by digging further into traditional governance. I do not think so.

“Insanity: doing the same thing over and over again and expecting different results.”              Albert Einstein

To summarise the digital movement is difficult but I would empathise three different areas that are critical for IT department:

  • Value: defining IT’s capability to support business and customer with “value-adding” services. Rationalize activities and services that does not bring any value.
  • Time: recognizing the rapid change in the digital markets re-shaping how IT plans and acts on strategic level. What is true today in not true tomorrow! How fast can IT react to new trends and customer demand?
  • Leadership: creating an atmosphere of trust where employees (cross boarders) dare to be creative and challenge conventional ways of working. Moving away from “command and control” to a more inspirational and trust based leadership.

Much of the discussions about digitalization are about technical stuff such as Internet of Things, Mobility and Data Analysis, but the real difference relate to the three areas listed above. Why is that? Mainly because these are areas where a traditional CIO feels comfortable in discussing and managing. They can do the same things (traditional IT) and expect different groundbreaking results. It doesn’t work! The fact is that we are not so far from the IT Governance conference in 2013 as we would think – we are just using other words. Everything else is the same.

I have worked with a number of IT organizations to guide the digital journey. In the end, we always come back to the same question

“Are you will to step outside your comfort zone and change the foundation of IT management to achieve digital success?”

Very few CIOs would actually answer “no” to the question and talk widely about the importance of change and digitalization. But when change start to happen, and the foundation of IT management is challenged – most CIOs are very uncomfortable and do everything they can to resist change. I have seen this over and over – listening to all kind of excuses why it is not the right approach. Change is only ok if is easy and comfortable – and controllable. But isn’t this the whole idea of change – that we actually move outside our comfort zone and let go of control to achieve something much better? Only those who dare to challenge themselves will succeed with the digital movement – others will be lost.

The digital movement is not about technology but rather about value, time and leadership. If any one of these three areas fail – it is most probable that the digital initiative will fail. Easy as that! I would say that 90% of all IT organizations fail to address these three factors and the consequences are huge. A majority of the Fortune 500 companies will not survive digitalization. Enormous about of revenue and customer value will be transferred from traditional companies (traditional governance structure) to digital companies (agile governance structure) where value, time and leadership plays a pivotal role in the management of the company and IT department. Something to think about!

When I look back at the participants of the IT Governance conference of 2013, I sometimes wonder they came. Was the purpose to get new ideas to drive something new or ensure that they were doing the right things (building comfort zone). Probably both! But 99% of discussion revolved around “traditional way of working” and that set the agenda for the day. I would say that most participants did not get their money’s worth in the conference – and did not after the conference make a difference in their companies. The conference built up more barriers around their comfort zones rather than break them down.

My recommendation:

  • When embarking on the digital journey – ask yourself: “Are you will to step outside your comfort zone and change the foundation of IT management to achieve digital success?” If not – let someone else do it.
  • Attend conference but select those that challenge your comfort zone – not those that strengthen the same zone.
  • Is your digital journey based on value, time and leadership – if not, stop the current initiative and re-start with the right focus!
  • Contact professionals to support the digital journey! Contact Hans Gillior at Sofigate!

I felt a sense of disappointment after leaving the IT Governance 2.0 conference in September 2013. It was a warm day in beautiful surroundings but still I felt cold winds blowing through my mind. After a couple of days, I concluded that the time was not right for discussing digitalization and agile IT governance and that most CIOs were not ready for this kind of approach. Today, the situation is different – or is it? Digitalization is on top of the CIO agenda but unfortunately most IT organization apply traditional way of working hoping to achieve a greater result. Do we really believe that it is the best way forward? If not, time to step out of your comfort zone and make a true difference!

Hans Gillior: Senior Advisor (Sofigate) and Digital Evangelist

Build trust with business – with right communication

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The value of communication is not purely based on logical reasoning with technical jargon but rather in adapting a business mindset – and focus on the business value in what you have to offer. Key in the new business oriented communication is to build trust and an emotional linkage with business where IT qualifies communication on the same level. Only then, IT can truly make an impact on business and actually deliver value.

I studied engineering, mathematics and physics in my youth where logical reasoning is the key for solving a technical problem. By using structure, procedures and logical reasoning, we could prove that our answer or solution was right. It was a very logical way to create value in the technical world. When I study CIOs and other IT managers approach to communication, I recognise a similar behaviour – a logical reasoning to prove a point or solve a problem – often with limited success. The fact is that I meet a large number of CIOs and IT managers describing a sense of frustration that business does not understand their reasoning and adapting their point of view. Could it be the case that we (IT professionals) have the wrong approach to communication and change management?

During the last coupe of years, I have reconsidered my views on communication. I have numerous times “struck out” in getting approval or recognition from business management using a communication technique I learn in university – a logical reasoning leveraging structure, technical jargon – proving the correctness in my solution. The fact is that business are triggered by another type of reasoning – “what does this mean for me”? It is a reasoning based on trust, showing the benefits, and using business jargon. I could say that it an emotional and relational approach to communication – where the logical reasoning has limited success.

My finding is that many IT organizations (staffed with technical staff even on senior management levels) have a logical approach to communication. I see IT departments building up mountains of processes, technical design, technical jargon and maturity assessments to prove a point of view communicated to business. There is a belief that if we only, using logical reasoning, can prove the correctness on our analysis, then business will recognise and buy our point of view. This is not working! The fact is that the IT department gets alienated in the corporation with this approach to communication and is seen as a “technical monkey” – not in touch with business reality. Would you trust him/her?

A good example is the focus on Service Level Agreements. IT set up SLAs on critical applications to quality ensure it s availability. But SLAs is a technical formula for running a logical reasoning. I usually here business saying – “interesting, but what does this actually mean? I only see loss in revenues.” What if the SLA metric can express (and communicate) business impact in a way that makes sense for business? It would allow for a different discussion on how business can leverage IT for optimize revenues. Good stuff!

Today, my starting point in communication is the ancient Greek philosophy of rhetoric and persuasion – pathos, logos and ethos.

“Ethos is an appeal to ethics, and it is a means of convincing someone of the character or credibility of the persuader. Pathos is an appeal to emotion, and is a way of convincing an audience of an argument by creating an emotional response. Logos is an appeal to logic, and is a way of persuading an audience by reason.”     – Yourdictionary.com

The idea of persuasion is to combine all elements of rhetoric in communication with business. There obviously has to be a logical reasoning (logos) but also high focus on ethos (building a sense of trust) and pathos (emotional connections). Most IT department communicates only out of logos create a sense of distance, disbelief and lack of reliability.

My point of view is that if IT wants to be recognised as a strategic partner with business, IT has to change its way of communicating (all elements of persuasion). The value is not in the logical reasoning with technical jargon but rather in adapting a business mindset – and focus on the business value in what you have to offer. What does this mean for me? Key in the new business oriented communication is to build trust and an emotional linkage with business where IT qualifies communication on the same level. Only then, IT can truly make an impact on business and actually deliver value.

My recommendations:

  • Review how your IT department communicates with business. Is it based on logical reasoning with technical jargon or from a business perspective? Logos, ethos and/or pathos? Know your audience!
  • Who are your audience and key stakeholders? What triggers them to “buy” an IT point of view? Build a communication/marketing plan to set the foundation for business interaction.
  • Ask business how they want to be approached – and how they want IT to communicate. If we do not ask – we will not have the answers!
  • Recruit a communication or marketing officer to change the way IT communicate with business.
  • Contact Hans Gillior and the Sofigate to guide your IT department in the right direction. It is a small step with high impact on how IT partner with business.

The main difference between mathematics/engineering and business decision-making is that there is no correct answer that can be proven right. Business decisions are often based on an analysis of the unknown and abstract where subjective views are a base for decisions – often based on experience. Two worlds are colliding. I can only go back to myself and the decisions I make – buying a house or car. In the end, the decisions are based on gut feelings after the house or car qualified on a logical level. How does the new house or car feel like? It is the same with IT.

Hans Gillior – Senior Advisor (Sofigate)

What IT can learn from Johann Cruyff

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We can learn a lot from Johann Cruyff’s “total football” by recognizing that people are the key asset of the IT organization. Greatness (value creation) is achieved when all people are working together cross boarder in an atmosphere of creativity and innovation to support the overall business vision and ambition. We call it Agile IT Management!

There are moments in time when a practice is transformed to reach a new level of excellence. Often the transformation is driven by a genius that dare to think differently and challenge the traditional – and show great success. One such genius is Johann Cruyff (recently passed away) who revolutionized football in the 1970’s to what it is today. A few days ago, he passed away in Barcelona but this legacy will always shine on the football pitch. It was an idea of “total football” based on creativity and innovation involving all players on the pitch. Earlier, football was based on an idea to minimize risk (defensive) and Cruyff idea was to optimize outcome (offensive). This is theory still is the foundation for clubs like FC Barcelona and Bayern Munich. The question I ask myself is how “total football” would look like in IT management. Isn’t it so that the current IT philosophy is based on risk minimization (operational excellence) instead of value creation? What can IT management learn from the ideas of Johann Cruyff?

The key principle for Cruyff’s idea is that all players are involved in offensive and defensive ambitions of the team through creativity and innovation. For me, this idea can be translated into IT management and is the ultimate IT management where IT (all parts) and business play together in beautiful harmony in creating value and experience for its end customers. We need to recognize that people are the key asset of the IT organization and greatness (value creation) is achieved when all people are working together cross boarder to support the overall vision and ambition. To many times, I see IT organizations revolving around tools and processes – and people are mainly viewed as production units. It creates silos and extremely complex governance to figure out how to get things done.

Today, I see IT organizations with ambitions to support business in a new way – with full focus on value creation. But the challenges are solved using old tools resulting in new complex governance structure, processes and tools. The key is in the people and that we view people as our key asset. That we allow for a “total football” in the It organizations where people are allowed to leverage their creativity and innovation in a common vision to create the best value for business. That IT Operations, Business Relationship and IT Governance play the same game and actually could be exchangeable – with fast and creative interactions. That is the way forward for the digital IT organization – we call it Agile IT Management (read more: hansgillior.wordpress.com).

My point of view is that IT organizations can learn a lot from the ideas of Cruyff in terms of “total football” and how we view ourselves. Many football players had probably thought the same ideas before him, but Johann Cruyff was the first to “implement” the ideas into practice. He dared to go against the traditional and the conservative, and take the football to a new level. And, isn’t it the same way in IT management? That there are people talking about new ideas but very few dare to that the step and challenge. These are the real heroes of the IT organization.

My recommendations:

  • Who are your heroes who dared to change the conventional way of working? What can you learn from them?
  • What are the key assets in your IT organization? People and competence, or processes and tools?
  • What are you willing to change to support business ambitions in the digital era? Success is built on challenging our current mindset and way of working – are you willing to go there?
  • Contact Hans Gillior (Sofigate) to discuss Agile IT Management – the way of optimize business value creation in the digital era.

During the Football World Cup in 1974, Sweden played an equal game against the Netherlands staring Johann Cruyff. Most Swedes don’t remember the score but rather a sequence of the game where Johann Cruyff invented a new trick and fools the Swedish defender off the pitch. This was pure genius and innovation in a single moment of the game. IT organization has the same opportunities to display our genius and innovation in contact with business – and that is what business expects. It is all about daring to do the unexpected and innovate in the moment to create business value in a new way. Do you dare to be innovative and creative in the next meeting with business?

Hans Gillior – Senior Advisor (Sofigate)

Read more: hansgillior.wordpress.com

If we had extra time – how to use it?

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Every four years (almost) on February 29th, we experience the ”leap day”. Since a year (the time for the earth to travel around the sun) is exactly 365,24 days, our Gregorian calendar year creates a small error each year that need to be adjusted (almost) every four years. Yesterday, we celebrated “leap day” and it can be seen as an extra day in our calendar. Great! Today, we take the “leap day” for granted and taken into account in our busy calendar. But what if we would receive extra day per week – not booked in our calendar. How would we use this time – one extra day per week? What does this say about us?

The question is very philosophical but it highlights a question on how we view ourselves and how we view time. A couple of weeks ago, I meet an IT organization trying to transform themselves to better support digital competitiveness. I think most of us can recognize the situation and the cultural resistance the CIO needed to overcome. Why do something different when things are working fine today? What is in it for me? When digging further into the culture, we noticed something quite interesting. Prestige in the management team was to be recognised a valuable person – expressed in participating in all meetings and hence working long hours. There was a correlation between working long hours and being regarded as an important person in the management team. Interesting! However, working long hours was also the main obstacle for driving transformation – as long hours limited the managers ability to see the full picture, analyze the situation and take the right decisions. Time was used to create prestige in the management team – not to create value for business. An extra day a week would with all certainty lead to an extra day of heavy work.

“Time was used to create personal prestige in the management team

– Not to create value for business.”

Why is this question so important? What does it matter how we spend our time – and what we do with an extra day? Well, it says something about what we prioritise and how we intend to get there. The fact is that how we spend our time is in direct proportion to our capabilities to run a (digital) transformation. Transformation requires a change mindset and it is fuelled by an adequate time to reflect over the current situation – and where we are going. The more time spent on operational issues (for example service management) will decrease the necessary cognitive abilities to run change – see the whole picture, analyse and make sound decisions. That is the case!

My point of view is that we need to set the scene for transformation by free up time for change capabilities. We will not get any “free days” but rather have to find ways for free up time in our current way of working. The question is not where to free up time – but how to create a culture that view time differently. To create a cultural environment where value is based on what you actually deliver in terms of change and services – according to expectations. The fact is that if there were only 6 hours per day – the work would be done equally well. The problem is that we use another 3-6 hours/day to continue to dig in the same hole – to no use.

“It all comes back to the fact that many perceive “free time” or “reflection” as something lazy, costly and unprofessional. The perception is that we create value by doing – not by reflecting, analysing or planning. Nothing could be further from the truth!”

The example above could have been taken from a number of IT (and business?) organizations. The way many IT (and business?) view time are a key problem that many management teams face. It all comes back to the fact that many perceive “free time” or “reflection” as something lazy, costly and unprofessional. The perception is that we create value by doing – not by reflecting, analysing or planning. Nothing could more wrong! In today’s fast moving business environment, it is more important than ever to analyse and make the right decisions – based on “reflection time”. “Reflection time” is a key success factor in the digital era.

My recommendations:

  1. What would you do with an extra day per week? Work more? Reflect? Or spend time with your family or friends?
  2. Understand how much of your time is spent on operational topics, and how much is spent on reflecting and learning?
  3. Contact Hans Gillior for a further discussion. Let us understand how time can be used in your team to drive change and value creation.

The fact is that most of us (IT professionals) work in average one day extra per week in overtime to cope with the overwhelming workload. To free up time is for many not possible. The question I ask – are we pending time on the right activities? What is most important – attending another meeting or enabling change? The problem is that we need to free up time to actually answer these question in a good way. That is the paradox of time!

What IT can learn from iPhone

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When iPhone was launched in 2006 – it challenged a compete industry and kick started the digitalization era. It provided a different business model based on customer experience. What can the IT organization learn from Apple and the iPhone? Very much! It is eye opener for the IT organization and how we, among other things, can revolutionise Service Management – if we are ready for it. It is an inspiration!

I few years ago, I meet some friends outside the IT industry – trying to explain how IT works and what I do for a living. How would you explain IT in the digital era? The question is very relevant as we as IT professionals need to, in a easy to understand way, explain the “magic” of IT and how IT supports business or our everyday life. The time when IT consisted of servers and platforms are long gone. I reached down in my pocket and retrieved my iPhone and spun it around for a while. My mind started wondering thinking that business views IT in the same light as people view the iPhone. It is a collection of services “apps” in a digital format that aim to make my life easier – boosting experience. So what can we learn from our iPhone usage?

When the iPhone was launched in 2006, it revolutionized the Telco industry with its new innovative design, functionality and focus on user experience. The main competitor Nokia had outstanding technical performance – and from a logical perspective, the iPhone would not stand a chance. But what the iPhone challenged was how traditional phones created value to its customers. Is value related to technical performance (battery) or to customer experience (user ability)? Obviously, customer won the battle and Nokia is now a shadow of its former self. What is interesting is that when iPhone challenged the market – most traditional phone makers responded in the same way – by adding qualities (technical performance) that the customer no longer wanted. In the end, the traditional producer could only compete with price. This was the beginning of digitalization – which we discuss today.

What I find amazing with the iPhone is the apps. There are in fact “micro services” that the user can add and remove in anyway they please from a huge app library. It gives the consumer freedom to adjust the functionality of the phone in real-time based on mood, location or interest – boosting our experience of life. Another aspect is that Apple do not produce any apps but open for third party vendors to develop apps for the customers. The popular apps will survive while others will be phased out or replaced in the ever evolution of digitalization and customer demand. Amazing!

It is the fact that IT organizations also are moving into a service based offering but IT services (compared to iPhone apps) are mainly static and require enormous efforts to run efficiently and to upgrade. Services are “stored” in a service catalogue and run in an outsourcing environment controlled by a long-term contract. Last week, I meet an IT organization running 100 different IT services – with a spider web of processes, people and coordination. Today we question how well these IT services create value to business. How easy is it actually to change or upgrade a service? How long time does it take? How does this lead-time affect business competitiveness?

My point of view is that we need to learn from the best when it comes to service management in the IT organization – the iPhone! What if we could run service management in the same manner as Apple with third-party suppliers offering a wide range of services that business can pick and choose from? What if there would be a natural selection when it comes to what services would be on the “top list” and what services that will be phased out? It is an interesting idea – and maybe not so far from where we want to be.

Wait a minute! It is a fascinated idea – but how do we manage quality and security of all different services in the service shop? It would be a total mess! Well, yes it would be a mess – if you run service management in the same way and with the same mindset as today. See the opportunities rather than the problems. The only this that stands in our way of a more dynamic “Apple oriented service management” is in fact our own mindset and governance. The question we have to ask ourselves is – what is the purpose and value of the services IT provides? Are we providing a Nokia or iPhone? Are we providing technical performance or customer (business) experience? These are important questions to clarify!

My point of view is that digitalization is changing the expectations on business to produce business value. In our aim to re-brand IT, we need to view the things we do in a completely different light and compare us to the best in the business – regardless of industry and offering. If we continue to view IT service management from an IT perspective – then nothing will happen, but if we view IT service management from an iPhone perspective – magic will happen. We start to define, govern and prioritize ourselves in a different way – challenging our conventional way of working. That is what innovation is all about!

The iPhone comparison has helped me in other areas as well. I actually used the iPhone comparison in describing how IT creates value to business. As iPhone users, we do not really care what is behind the screen (technology) but rather how the iPhone supports our daily life (user ability) – making us successful, relaxed or other experiences. It is our expectations what is managed so brilliantly by Apple by a focusing on customer experience in everything they do. In the same way, the IT organization should be judged on how its services support business competitiveness – based on their expectations. The value IT creates is in direct proportion to business experience of IT – relating to how well IT manages business expectations of the IT role in the value chain. Brilliant!

Further reading: Value of IT Framework https://hansgillior.wordpress.com/2013/09/11/the-value-of-it-the-most-valuable-framework/

My recommendations:

  1. Well looking at your current way of working in IT management – who are your role models? Who are the stars on your horizon? Is the comparison brave enough? What can you learn from their way of working?
  2. What is hindering you from being like your role model? How does the Operating Model support the new generation IT organization? Do we have the right competence, governance and attitude to make that step?
  3. Don’t see the problems – but rather the opportunities! There are amazing opportunities today if we actually look towards the sky and imagine a different way of working. Reach for the sky!
  4. Contact me for a further discussion – let us make magic together!

Back to my discussion with my friends – about what IT is all about. I showed then the iPhone and how it has revolutionized the world – kick-starting the digital era. How the iPhone was changed the way we communicate, interact and consume product and service. It was a great afternoon! In the evening, I started to think about who my role model is and how to challenge my way of working. I have to think about that for a while.

 

New role of CIO – a marketing person!

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The role of the CIO is rapidly changing! Recent research tells the story that a digital CIO is a man of marketing – to create a “platform of trust” with business and re-brand the IT organization. It is all about managing expectations in every interaction with business. But what does it mean? And how to get started? It is simpilar than you think!

I try to read as many research papers as possible that describes the digital affects on the IT organizations and role of CIO. Each research paper gives a small but valuable piece to the digital puzzle. They all have one thing in common, the fact that the role of CIO is rapidly changing. It is no longer a technical experts that monitors servers. Rather a business enabler that bridge the gap between IT and Business – a pivotal role in the digital transformation. While 2/3 of business leaders state that they are not prepared for digitalization (Ricoh 2016), they are mostly satisfied with the CIO and his/her capabilities of driving the digital transformation. I ask myself, what are the key elements in the CIO capabilities that are necessary for driving change?

When I talk to CIOs, I see that the digital transformation is high on their agenda. However, the CIO need to build a ‘platform of trust’ with business – in terms on stability, cost efficiency, risk mitigation, business collaboration and value creation – to gain access to the strategic partnership with business going forward and drive the digital agenda.

Further reading (Platform of Trust): https://hansgillior.wordpress.com/2016/02/03/platform-of-trust-key-for-digitalization-in-2016/

I see too many IT organizations jumping from a stability focus (not achieving the platform of trust) to running a digital agenda with little success. Let’s try to avoid that!

The Ricoh CIO study (public sector, 2016) confirmed by reasoning. The top three CIO capabilities today (selected by business leaders) were quite surprising.

  1. Communication & Marketing
  2. Technical expertise
  3. Business understanding

The successful CIO (valued by the business leaders) is one that easily can communicate and “sell” a new role of IT for driving the digital transformation. It is a marketing person! As we all know, marketing is based on a ‘platform of trust’ between the vendor and the client. It is difficult to sell anything if the reputation has been blackened by poor quality or too expensive services. How do you react when you have bought a new car that soon breaks down and cost more than expected? Will you buy a similar brand again – and what will you tell your friends? Trust (in all business interactions) is obviously built on the expectations we as customers have on the commodity or service we buy – to create great experience. We have in our minds expectations on everything we do and buy that can either be fulfilled or lost. We constantly evaluate brands, people and situations to figure out what we like and don’t like. So, the modern digital CIO is all about managing expectations, building a ‘platform of trust’ and re-brand the IT organization. What is interesting is that expectations are managed in all interactions between IT and business – and not just the final delivery of a project. It is called Moment of Truth!

Further reading (Moment of Truth): https://hansgillior.wordpress.com/2014/06/12/moment-of-truth-basis-for-customer-experience/

But wasn’t this a study relating to public CIO? Slow down! Couldn’t it be that the situation for public CIOs are different than for corporate CIO? Well, that is up for interpretations but my view is that public CIOs have very similar situation than corporate CIO – maybe a bit more challenging in driving the digital agenda. For me, the logical reasoning works also for a corporate CIO.

My point of view is that running IT is more or less like running any other business. IT has its product/services, price list, customers, budget and interaction with customers. If IT does not deliver what is expected from its customer – the customer will go somewhere else (shadow IT). Digitalization is changing (very much for IT) the customer demand requiring faster and relevant services delivered without any problem. As any other business, the IT department has to address these requirements but also be proactive and highlight how IT can support its customer’s competitiveness – by managing expectations, building a “platform of trust” and re-brand the IT organization. Try to imagine the alternative!

Recommendations:

  • Try to view the CIO’s roll as a man of marketing – with an aim to re-brand the IT organization. What would that mean for you? Would you need to learn more about marketing and sales?
  • Ask yourself, what are you doing to build a “platform of trust”? How are you managing expectations? What happens when the “platform of trust” falls?
  • It is important to figure out what marketing message the IT organization want to communicate to business. How would you describe IT’s value proposition in a sentence or two?
  • Contact Hans Gillior (Sofigate) and we will discuss how to build a “platform of trust” and re-brand the IT organization. That is what we do!

To tell someone to re-brand the IT organization is quite easy – but to take the first step on the journey is trickier. How does marketing fit in too our daily work of budgeting, vendor negotiations and reporting? The fact is that marketing fits into every part of the CIO daily agenda. Think about how you are perceived in the vendor negotiations or weekly meeting with your team or in meetings with business. What messages (verbal and physical) to do communicate? How important do signal that they are for you? That is where it all starts – with a smile.

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Platform of Trust – key for digitalization in 2016

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The nature of digitalization is constantly changing. What defined digitalization a few years ago is no longer relevant. Today, it is about creating a platform of trust to qualify IT for a digital partnership with business. It is all about leadership, governance, knowledge and motivation – to drive the digital change agenda.

In 2012, I travelled to Gartner Symposium ITxpo in Barcelona. It was a great adventure with inspirering lectures, and meetings. It is one of those moments when the reality is explained and the fog is finally clears away. Digitalization was explained utilizing the Nexus of Forces framework highlighting Social Marketing, Cloud, Mobility and Big Data. This was a first time a company actually could define the concept digitalization. I was amazing! But the question I ask myself is what has happened since then. Is the Nexus of Forces still relevant for business and IT?

When I discuss the concept Digitalization today, I notice that many CIOs still refer to the Nexus of Forces. There are high investments in social platforms, cloud solutions, mobility and big data analysis. Digitalization is mainly about investing the right technology. But, if we study the companies that are truly successful in digitalization, we see another pattern emerging. We see IT organization adjusting governance, leadership, upgrading competence and focusing on innovation to drive a digital partnership with business. Also, that successful companies focus on building a platform of trust. This means that IT organizations (in the eye of the digital storm) focus on five capabilities at once in a balanced way:

  1. Operational Stability
  2. Operational Excellence
  3. Business IT Collaboration
  4. Business IT Agility
  5. Digital Partnership

That is interesting in the “platform of trust” is that all five layers need to be in focus to reach the fifth level – Digital Partnership. Without stability, productivity, collaboration and agility – there is simply no trust to discuss digital partnership. What we see are IT organization focusing on one or two of these layers – reducing the level of trust in the corporation and hence hindering IT from becoming a digital partner. One can see similarities to the Maslow’s Pyramid of Needs – where the basic needs have to be fulfilled before moving into Self Actualization.

The discussion of “platform of trust” is very much related to Bimodal IT. Bimodal IT is a concept suggesting that IT need to be governed in a fast (agile) model and a slow (traditional) mode to support digitalization. Yes, I agree. Layers 1+2 is very much about the slow (traditional) mode while layers 3 + 4 are about sprints. It makes perfect sense! But once again we see IT organization focusing on one or two layers – not getting the focus right.

My point of view is that the model to manage digitalization is a moving target and will continuously change. What we called digitalization yesterday will not be how we describe digitalization tomorrow. That is the unpredictability of digitalization. Therefore, the NEXUS of FORCES need to be challenges from our current perspective – where IT need to focus on creating a “platform of trust” but meeting or exceeding the business expectations. Focusing on the softer aspect of the IT organization – leadership, competence/knowledge, people and information, does this. Digitalization is no longer about the technical aspects of IT management but rather transferred to focus on the softer aspects. That is digitalization in 2016.

My recommendation:

  1. Looking at your digital agenda – is the focus on technical or governance? The two investment areas should be balanced.
  2. How well is your leadership and governance aligned to the business expectations? How well are employees motivated to drive change and innovation?
  3. Do we have a “platform of trust”? Does the IT department have a good relationship with business based on trust?

On the airplane back from Barcelona, I scribbled down my analysis from the 2012 Gartner ITxpo. The pen was glowing as I wrote down all new ideas and findings from the four-day event. The euphoric feeling has now been replaced by a question mark about the validity of the findings. How do we define digitalization in 2016? From my point of view, the answer if crystal clear – it is about creating a “platform of trust” with new governance capabilities to qualify IT to become an Digital Partner with business. Simple as that!