Institutions across the world are facing unprecedented structural transformation. There are requirements to meet new regulatory imperatives, re-invigorate security procedures to handle increasing internal and external threats, and re-model business structures in consolidation or expansion strategies.
Each of these areas of business transformation places the CIO at centre stage. With increasing focus on the IT function, the CIO faces pressure to drive change in difficult and changing conditions.
They are embarking upon major IT projects in conditions where expenditure is under constraint, whilst attempting to find budget to support innovation projects to achieve competitive advantage or expand in new markets. These challenges require a new approach in terms of IT planning, decision-making and investment.
So what are the strategies CIOs can employ to meet these challenges, and drive business growth and innovation to capitalise on new opportunities in 2012 ?
Simplification of IT infrastructure and processes
Structural change, whether resulting from consolidation or expansion, means simplification of IT infrastructure and processes will be crucial in the coming years. Some organisations may be looking to reduce overall IT spend, while others will be looking to integrate or replace the IT systems from a new acquisition or quickly expand into new markets.
For this to happen, CIOs must remove legacy infrastructure burdens and aging systems. This will enable them to improve customer experience and speed-up decision-making. Outsourcing remains a key strategy in driving the business forward within constrained IT budgets.
Recent ICT outsourcing deals demonstrate a move towards a hybrid sourcing model which combines in-house management of business-critical services with outsourced management of less critical sites and services.
This can involve outsourcing the data centre function, as well as the management and development of the core infrastructure, which has particular appeal to smaller institutions.
In addition, emerging technology models, such as virtualisation and cloud computing and in particular moving applications into private or hybrid cloud models, will come into focus to reduce the total cost of infrastructure.
However, the move to cloud-based services gives enterprises the opportunity to place some of their non-core activities and back-office functions with external suppliers. By managing and integrating these new models with existing systems, organisations can achieve a standardised capability, scalability, flexibility, and a known cost model where CAPEX is transformed into OPEX.
New ways of managing data to drive transformation and meet regulatory imperatives
The digital age has created incredible amounts of electronic data to process. How this data is used and ordered, whether for business intelligence to drive decision-making or for new procedures to meet reporting requirements, has become critical for success.
These imperatives create new problems for CIOs due to the complexity and time consuming nature of handling and storing large quantities of digital information. Working with trusted partners can help deliver the specific understanding, service management and compliance initiatives that are crucial in this process.
While some of these systems and tools are likely to be already in place, CIOs should revisit data governance frameworks to ensure that these remain fit for purpose. Moreover, for organisations that have grown in the last twelve months through acquisition or expansion, what may have been sufficient in 2009 may be wholly inadequate for 2012.
The network as the backbone of expansion
With change and disruption comes opportunity. Organisations that emerged relatively unscathed from the financial crisis are exploring the opportunities presented in emerging markets to gain a competitive advantage. In this process, the IT function is becoming the business enabler of expansion.
Through the provision of a robust, scalable and secure communications network as the central nervous system of the modern business, the CIO can ensure the organisation can provide the foundation for open, connected collaborative environments across the whole organisation such as the increased use of telepresence.
The CIO can also drive innovative new products and services such as mobile commerce and new web platforms to reach the customer. To make sure these opportunities are capitalised upon, speed to market is an imperative for competitiveness in today’s post-global financial crisis reality.
To deliver this business environment in new markets, organisations can work with trusted partners that provide robust and resilient infrastructure, dedicated customer service teams and local expertise that means their critical communications systems will be up and running quickly and efficiently to deliver ongoing growth.
Embracing new technologies
Economic growth, changing demographics, and the explosion of social media make transforming customer experience through innovation crucial for business growth.
For consumer facing organisations, a new emerging customer base now expects to be able to interact with businesses from anywhere and at any time of day or night, and reach the information or resource they need instantly. Businesses now need to innovate across branch, telephone, Internet and mobile channels, and embrace emerging technologies, such as social networking.
Smartphone proliferation now provides additional infrastructures for industries to extend their services and become more consumer friendly, and many providers have taken a universal approach through browser dependent platforms, which are accessible through most smartphones and tablet devices.
Embracing mobile technologies offers the advantage of supporting business growth by driving internal productivity as well as providing better support for customers. Using mobile channels enables organisations to provide relevant and timely information to assist their customers’ purchasing decisions.
Internally, mobile phones and the mobile network can provide location-based information that connects with existing ICT infrastructure and enterprise systems inside the organisation to deliver a more streamlined customer service.
New solutions for a new financial age
Organisations have had to undergo significant business transformation to survive or grow from the financial crisis. The transformation will continue as competition grows from traditional competitors and new forces enter the market. As the global economy continues to shift eastward, institutions will look to explore new business models, partnerships and consolidation opportunities.
In this process, technology and innovation must take centre stage. The change will be rapid, and the CIO must adapt traditional IT practices to ensure the business is not just looking at current trends, but planning for long-term growth.
Technology’s role in the customer experience, in particular, will be key. Customers are increasingly seeking to connect to the institution through the devices of their choosing, through mediums of their choosing, and importantly, in the moment of their choosing. Institutions that use ‘on demand’ technology effectively to deliver useful customer experiences will be most successful.
With increased cost pressures and an ever growing demand for flexibility, accessibility and personalisation of services, organisations will accelerate their use of technology to meet new customer needs.
Meanwhile, cloud computing platforms and applications will combine advanced analytical tools with new ways to manage data, and social and mobile computing to reshape the way industry designs and delivers value added products and services to customers.
With the CIO at centre stage, the IT department will be in prime position to drive improved performance and implement new approaches and strategies. It will provide the backbone of the new structure of the organisation, and drive innovation and change to put their organisation out in front in the new age of doing business.