IT must build digital leadership and bimodal capability, while renovating the core of IT and otherwise preparing for the digital future

By Suzanne Adnams, Gartner, Inc.

CIOs today face a host of digital opportunities and threats, with all industries in all geographies undergoing digital disruption. The strong Canadian economy has provided Canadian organizations with a competitive advantage in being prepared to pursue new markets or invest in innovation and growth.

Gartner’s Executive Program annual survey of more than 2,300 IT leaders worldwide reveals that Canadian survey respondents reflect the same trends as the global responses, but with a gradual shift of management focus from efficiency and effectiveness in favor of growth and innovation.

The notable swing toward growth and innovation in Canada may indicate that business is in a better position to leverage Canadian economic stability to move into new markets, compared with the global experience following the economic downturn.

Several factors, however, could limit this influence and undermine Canada’s advantage, unless they are addressed directly. These resistance factors include a very traditional approach to IT management that is slower to adopt new digital roles and responsibilities, cautious risk policies that limit consideration of new service options, and dependence on internal capabilities in a challenging labor market.

In 2014, CIOs must transition to a new era of enterprise IT — an era of digitalization that impacts strategy, leadership, structure, talent and financing. They must build digital leadership and bimodal capability, while renovating the core of IT and otherwise preparing for the digital future.

Most businesses have established IT leadership, strategy and governance but have a vacuum in digital leadership. To exploit digital opportunities and ensure that the core of IT services is ready, there must be clear digital leadership, strategy and governance, and all business executives must become digitally savvy.

There is a fast-rising trend globally to hire chief digital officers (CDOs), who are more likely to come from roles in the rest of the business than from IT. While Canada has been slower to adopt the formal role of CDO compared to the global stage, this is not necessarily an indication that Canadian organizations are avoiding the move toward digitalization. The Canadian business environment and public sector tend to have a more traditional management model and a more cautious approach to introducing new senior roles.

The presence of a digital strategy is a good indicator that an organization understands both the value and drivers for creating a new CDO role, and recognizes that this is different from the CIO role. There is a risk that the functions and responsibilities associated with a CDO role are likely to be added to an existing executive position, such as the CIO, VP of IT or a business executive, unless there is a compelling business case creating a separate CDO position. This pattern is not expected to change in the near future, unless the CIO becomes a visible advocate for the digital agenda.

Moving forward, Canadian CIOs can support and assist their organizations in overcoming the resistance factors by embracing new opportunities and become strong advocates with executive and business leaders for pursuing a digital agenda.

Canadian CIOs need to pursue a formal bimodal approach to IT to balance legacy and traditional environments with growth and innovation. Achieving this bi-modal capability is an absolute necessity as the era of digitalization poses many ‘non-linear’ challenges such as the need to absorb disruptive new business models enabled by new digital technologies; the need to scale up and down in Internet time and the need to explore and evolve solutions that are surrounded by uncertainty.

This is not a quantitative improvement; it’s a fundamental change in the way information and technology show up in the enterprise – a rethinking of the role of the CIO and the IT organization, and the rest of the business’s expectations.

Suzanne Adnams is a research director in Gartner’s CIO research group, focusing on the IT service leadership challenges related to strategy, governance and organizational challenges of IT service management.

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