THE WHY AND HOW OF DIGITAL TRANSFORMATION

The Leadership Paradox

The Leadership Paradox

January 5, 2017 Insight 0

Who owns Digital Transformation within an organization? Studies show that it’s still the CIO (37%), followed by the CEO (25%).

Basically, the CIO is expected to optimize IT operations and security, manage and lead a highly skilled team, uphold system stability and minimize risks, while reducing costs. That is no easy task, especially when you realize that while 72% of IT and business execs think that a digital business model is critical, only 15% say they believe their company can really build this model. This leaves CIOs fighting their way through limited resources, trying to give shape to their innovations so they can benefit the company.

One main problem is the skills IT skills gap. 34% of survey respondents state there is a shortage of talent in the newest and most advanced analytics area, making the ones that know what they’re doing hard to find and expensive. But there is another, more paradoxal problem:

1: While IT is believed to lead the Transformation process, in real life they often don’t even get close to implementing an innovative or disruptive digital strategy. They’re often called in to either fix everyday bugs or work on the really heavy stuff: fixing problems and patching up old systems. Being innovative, agile and organization-wide is seen as something that has to be outsourced.

2 At the same time, the question remains whether it is the CIO who SHOULD have ownership of Digital Transformation in a company. The Economist Intelligence Unit (EIU) surveyed more than 800 business and IT leaders globally and found that organization-wide strategies are way more effective than IT-based transformations. 93% of the respondents that have an organization-based strategy say that it is highly effective. Then why do so many company leaders still believe the main responsibility should be in IT?

CIO’s are expected to have ownership of Digital Transformation, but IT is not the go-to department when it comes to true transformation. Meanwhile, Digital Transformation processes are most effective when the entire company is in it. The CIO has to build a bridge between this gap by combining strategy and technical innovation.

The most successful CIOs are able to separate their tasks, leaving operational responsibility with others in the department, creating the time to dig into strategizing their way to move the company. Because a great part of it is still politics and running against people who are not necessarily on board with new plans to optimize for instance employee or customer experience. Adopting an agile and iterative style is key: identify existing processes that will immediately benefit from a digital update and show results right away. These updates can then function as a showcase for the rest of the c-suite and the organization.

The CIO is closer to the CEO than ever, being in the middle of (technical) innovation, strategy and team management. A daily struggle for some, but an interesting challenge for most.

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About the author

Bert Stam
Racker since 2013 - Bert is the CEMA Sales and Marketing Director at Rackspace. After working at HP for eight years, Bert joined Rackspace to lead expansion into Benelux and Nordics. In his spare time he is an avid cycler.

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