ADVANCED PRACTICES COUNCIL - INSIGHTS - JANUARY 2017
Successful CIOs find the right balance between their roles of ensuring outstanding service delivery and transforming their organizations through digital technologies. Service delivery includes creating new systems and processes that enable compelling products and services for customers - and creating them quickly and flawlessly. Transformation entails anticipating market opportunities and inventing new products and services for the firm that exploit current technologies and tools.
At the January Advanced Practices Council meeting, members explored both CIO roles. They addressed the transformational role both through a presentation on digital transformation and a discussion on the internal processes required to move quickly and compete in a digital world where traditional organizations must compete with digital organizations with little or no legacy systems or infrastructure. They addressed the service delivery role through presentations on biometrics, project management, and agile/devops.
Vijay Gurbaxani of UC Irvine's Center for Digital Transformation began with examples of how digitally savvy companies enhance their value exponentially. McLaren, a Formula 1 company, has transformed itself into an analytics company, leveraging its expertise in applying analytics from large stores of real-time digital data streams (in racing cars) to drug discovery in the pharmaceutical industry. CVS Health applies analytics expertise to detect prescription non-adherence and predict which patients will have heath crises. Vijay quoted John Chambers, CEO of Cisco: "40% of businesses will not exist in a meaningful way in 10 years. 70% of companies will attempt to go digital but only 30% of those would succeed. If I'm not making you sweat, I should be."
To further drive his point, he compared the valuation and number of employees in digitally savvy companies (What's App is valued at $22B and has 70 employees) with old economy companies (Hewlett Packard is valued at $30B and has 240,000 employees). Having gotten everyone's attention, he said that old economy companies that will have to compete with digitally savvy companies must seek value creation opportunities using software.
More specifically, he prescribed four steps:
1. Re-imagine your offerings for greater performance leveraging your knowhow in products, operations, and customers
2. Develop a platform strategy and ecosystem
3. Build core competence in software
4. Nurture the culture of a software company.
The culture and processes of a software company that support an adaptive organization were the subject of a member discussion that drew from Exponential Organizations by Salim Ismail. Members shared their practices and intended next steps in developing practices related to:
• Leveraged assets, which are needed for speed, functionality and flexibility
• Engagement of staff and customers, which create network effects and positive feedback
• Dashboards for measuring and managing
• Algorithms for leveraging big data and powerful analytic tools to take better decisions and actions
• Social technologies, which create horizontal interactions in vertically organized companies
• Experimentation for testing assumptions with controlled risk
• Autonomy for self-organizing, multi-disciplinary teams operating with decentralized authority.
What happens when weak passwords meet proliferating Internet of things devices? According to Dmitry Zhdanov, professor at Georgia State University and cybersecurity expert (and coincidentally Russian), it takes hackers only three days to crack any 8 character password, however clever it might be. There are ways around it (i.e., four random words), but companies need better means of authentication. Biometrics may be that better way, given its characteristics of being very difficult to forge. Dmitry walked us through the various biometric forms (e.g., face, fingerprint, hand geometry, retina, iris, behavioral characteristics) as well as the advantages and disadvantages of each. He ended by suggesting consideration of multifactor authentication, which may be the best option.
Reducing Project Risk
Although CIOs haven't directly managed projects for many years, they are still ultimately accountable for project success. What can they do to address inevitable project risks? Mark Keil, also of Georgia State University, provide some answers from a career focused on researching project management. He shared approaches to avoiding biased project status reporting, including one that addresses over-optimistic assessment of project risk. According to his research, managers routinely underplay the risks on their projects. But he discovered that how executives frame their questions to managers can significantly and positively influence managers' assessment of risk. When executives framed their questions at a high, abstract level (e.g., general questions), managers were over-optimistic about their ability to deal with the risk. However, when executives framedtheir questions at a lower, more concrete level (e.g., more specific questions), managers' assessment of project risks weremore realistic and led to better plans for mitigating risks.
Many organizations have adopted agile devops approaches on non-complex projects that lend them themselves to quick development and require rapid turnaround. The research team headed by Sunil Mithas at the University of Maryland presented characteristics of the teams and the environment that lead to successful agile devops projects. Excellent teamwork requires people who can work collaboratively in a trusted environment. When the need for business involvement in technology decisions is high (as it will likely be in most cases), then having business experts on the teams will result in greater success. The right balance between discipline (e.g., centralized standards, quality assurance, testing methods, strategic clarity, metrics, rewards) and team autonomy (e.g., let teams decide on extent and ways of applying agile devops methods, give teams latitude for fulfilling customer needs) will take time, but is worth pursuing. The team also reminded us of the value of nurturing a fail-fast and learn-fast culture. Finally, the team reminded APC members that the learning from successful agile devops projects can be valuable to other functional areas in the company.