IT departments are under increased pressure to continuously innovate to provide greater value with emerging technologies. But digital initiatives are often complex, multi-year transformation journeys that transcend economic, regulatory and master business platform cycles. How do CIOs navigate through these cycles and balance them with economic, business and technological factors to achieve the greatest impact in the long run?
Weathering the seasons of change
All too often, business-IT leaders confuse a change in business cycles with a change in the vision for the evolving new business model. Without a clear focus upon the new business model, the enabling capabilities, the underlying priorities and financial implications, transformation is impossible.
A veteran CIO once said to me that businesses and IT perpetually cycle through four seasons:
Season of Innovation: Technology, markets or competition force or provide opportunities for major innovations in aspects of your business model. During this time, companies make resources available and offer incentives to encourage innovation.
Season of Consolidation: We’ve all been through this one. Often times, following a recession or business downturn, resources are downsized, innovation is curtailed, costs are lowered, and controls are tightened.
Season of Yield: After investments are made, the focus shifts to achieving greater returns. This may be after the implementation of a major system, such as an ERP or CRM, or a business expansion.
Season of Re-Platforming: This happens when there is a need for a significantly different or enhanced business and operating model. A major, visionary endeavor is funded, resourced and underway.
Think of seasons as the wind and digital as your boat
Your overall vision should not be confused with the season underway or emerging. Many businesses experience a seasonal shift from innovation to consolidation, particularly during times of a global economic downturn. However, there’s never been a greater need to continue pursuing the vision of becoming a more digitally-enhanced business, using technologies and techniques.
In tight times, the focus of your digital efforts will probably be trained on cost reduction, complexity, resources required, time to market, as well as process optimization and workflow transfer to customers and partners.
Equally critical is the realization that the management styles, focus, enablement and skills relevant for each season differ dramatically. Few businesses have the luxury of changing their teams and skill-sets to adapt to the next season. However, you will have to change emphasis, leadership styles, expectations and sources to be successful. Today’s business and IT leaders cannot afford to postpone their visions, be trapped in a season, or rely on previous-season approaches and skills.
Sometimes it’s best to double down when times are tough
Competitive advantages are seldom gained in good times. The rise of numerous game-changing technologies and the fall of economic indicators means the time is ripe to either seize competitive advantage or be at a disadvantage vis-à-vis your more proactive rivals. The majority of cases of really gaining competitive advantage that I’ve seen over many years, occurred surprisingly not in economic upturns, but in changes that were made that transcended and prepared the enterprise for the next seasons.
So which season has given you the most challenges? To read more on this topic, please check out my article 50 year Journey to a Digital Business.