You would think that, on 'planet digital’ where all banks are heading, the CIO is king.
And yet it doesn’t feel that way from within the CIO’s office.
Although undeniably the IT department has come up from the literal and organizational basement (and I should know having made that figurative and literal journey myself), the CIO is under more pressure than ever to square circles and pull rabbits out of hats.
Firstly, the CIO needs to manage what he builds with. Although the complex legacy infrastructure, existing capabilities and architecture are neither his choice nor his doing, they are both his problem and his domain. They need to be managed, kept ‘on’ at great cost and heartache and – adding insult to injury – the CIO’s leadership team have to defend that fact in meetings with the business, each day, as if everyone had forgotten how these systems got there in the first place.
Meanwhile, with every passing day, legacy infrastructure gets more expensive, budgets get more constrained, teams get more geographically disparate and more heavily matrixed in the pursuit of operating leverage if not efficiency. The CIO needs to magic solutions, manage partners who, in the name of cost, may be holding key pieces of the efficiency puzzle and, naturally, he needs to have answers. For everything: from on-boarding to Blockchain and billing to Big Data. He needs to answer and do everything, while going Agile, rolling out design thinking and reducing headcount.
But essentially the advent of the digital era removes friction, the in-between steps and processes that existed because there was no better way
Secondly, the CIO needs to manage who he is building for: the business. This is an unwilling customer and the CIO needs to justify spend allocation to people who often don’t understand the specifics or bring a complex history of mistrust that has nothing to do with individuals and everything to do with institutional memory.
So what should be a business discussion about relevance, profitability, operational alignment and the technology to support it becomes a discussion about budgets for systems for businesses whose customers don’t enter this equation.
It Is Time the CIO Met the Real Customer
This is occasionally harder than it sounds, particularly in the B2B space where segments and brand names obfuscate customer journeys: who uses what they buy from you, how and why. Complex services or simple products; the need to connect to the customer is the same. Ironically, in a complex B2B organization, making the customer the core of delivery and untangling the legacy spaghetti in the process, is harder and even more essential.
Whether you sell retail bank accounts or CDOs; whether you sell to individuals, businesses or the markets, finance writ large is an enabling step not an end state. Nobody gets a loan for the fun of it. Nobody performs an IPO for the experience. There is concrete business getting done somewhere along the way; a real life being lived. Whether you sit within a high street bank or a custodian, there is a value chain and you are a part of it. Your profitability is linked to your relevance, more than your efficiency.
The CIO, today, is finding himself with a weighty responsibility to the business. They turn to him for the ‘how’ but actually they need him, more than ever, for the ‘why’.
Digitization at the Core of the Business
Digital is a reassertion of relevance through technology not just an App. Big words. But essentially the advent of the digital era removes friction, the in-between steps and processes that existed because there was no better way. A school leaver today won’t know what the yellow pages are. The idea that, to make a restaurant reservation, we would leaf through a book delivered periodically through the post and kept under a designated telephone spot in the household is fraught with quaint anachronism. The digitization of the experience didn’t recreate the process, it solved for the need, relevance.
The journey is neither easy nor unemotional. But it is not optional. And the CIO is uniquely placed to drive it.
Give the Business Homework
Solving the question of ‘who owns the customer’ is less important than who the customer is and why they are a customer. ‘User journeys’ and ‘customer centric design’ are not simply concepts: the business needs to understand their usefulness, not just the mechanics.
And the learning doesn’t stop in the boardroom.
As the organization digitizes to provide seamless and relevant service to customers of all shapes and sizes, the entire organization needs to understand what their part in this shifting world is.
Product folks may not know how to make an API call, but need to understand how to price one. Ops teams may not know, or indeed care, what Hadoop is, but need to learn to interact with real time process data to drive efficiency.
The change won’t happen overnight and it will require new partnerships, new relationships and new ways of thinking.
Have the Conversation no-one Else Wants to Have
Revisiting one’s commercial relevance is uncomfortable by any measure and any definition. But in the midst of regulation, squeezed margins and disintermediation, it is the only question worth spending time on.
The CIO is uniquely placed to drive business purpose in the boardroom. No other champion has as holistic a view of the current state and the path to a future. But the future has to be imagined before it is built and that is a team effort.