Digital, the all-encompassing term for the next era of technology and associated business models, would seem like a boon to IT leaders. Suddenly, technology has gone from a topic that was more likely to generate drooping eyelids in boardrooms and executive meetings, to being perceived as a cornerstone of the company's strategy going forward. Industrial giants like GE have very publicly abandoned entire segments of their business and bet on digital, in GE's case effectively becoming a software and data company rather than a manufacturing and financial services business. While digital can indeed be a boon to your career as an IT leader, there are two significant risks.
Digital doesn't necessarily mean IT
One of the most significant risks to IT leaders, and entire IT departments, is automatically assuming that digital means IT. This is a mistake that's easy to understand. After all, "digital" by its very nature implies technology, and where else would one look for technology but in the information technology department and the CIO? However, digital also implies new ways of working, new business models, and rapid execution, areas that many IT shops and IT leaders struggle with. One merely has to look at the rise of shadow IT, or see what portion of the average chief marketing officer's budget is spent outside of internal IT to see that much of the technology that falls under the digital banner is being sourced from outside IT. In many cases, entirely new digital groups are being created, headed by a chief digital officer who may report to or manage more traditional technology roles.
If you want to take a leadership position on digital within your organization, realize that the technology is only a small part of what encompasses this new era. The last revolution in technology, the internet era, had standardized communication networks as a core technology, but successful companies required far more than just an understanding of networks. So, too, will digital require far more than an understanding of technologies like Internet of Things and analytics.
You may also want to consider playing a supporting role as digital takes root in your organization. Many of the new models and practices that digital enables require supporting data, so building new platforms, API-based services, and supporting infrastructure will allow IT to remain a key player, without requiring you to retool your career and your organization around digital.
The other major risk related to digital is perceiving it primarily as an exercise in new technology. The world is becoming increasingly littered with digital "labs" that have all the neat toys, a handful of unconventionally dressed programmers and designers, but no real business objectives. These labs might produce a neat app or a fancy virtual reality proof of concept, but their costs and the disconnect between their output and the business's strategy will quickly create frustration with the lab itself, digital, and technology and its supporting organization.
Like any endeavor, experimentation with digital should have a well-defined objective and appropriate benchmarks to measure success. It's legitimate to have a different expectation and set of benchmarks for some of the highly experimental work you might be doing in digital, but it's unacceptable to fund directionless projects that don't produce anything of value.
It can be tempting to rush into digital, and happily hire a CDO and build up a lab when your management team is demanding action and waving a huge budget under your nose. In extreme cases, you might even be asked to hop on a plane to Silicon Valley and get to pretend to build a startup from scratch. However, in the longer run you'll prevent career disaster by tempering some of this enthusiasm and spending the time to tease out the objectives for any digital experimentation, how you'll define and measure success, and what strategic efforts digital should be contributing to. GE, for example, has publicly stated objectives for software sales on a specific timeframe, making the establishment of a California software development center a sensible proposition. Contrast that with the dozens of companies that want to "be more digital" and grow frustrated after spending millions with no quantifiable result.
Digital presents some obvious opportunities for IT leaders, ranging from recasting themselves as a digital organization and driving digital strategy and execution, to playing a critical supporting role and being the adult in the room when the temporary insanity of "shiny object syndrome" strikes the executive suite. Consciously planning how you want your organization, and you individually, to play a part in this new era of business and technology are key to success, rather than allowing events to dictate a role you later find unsatisfactory.Also see:
- Why IT and business must close the expectation gap to drive success in digital transformation
- 89% of tech pros say IT automation is necessary for digital transformation
- The 5 pillars of digital transformation businesses need to set themselves up for success
- Digital Transformation: A CXO's Guide (ZDNet)
Patrick Gray works for a global Fortune 500 consulting and IT services company and is the author of Breakthrough IT: Supercharging Organizational Value through Technology as well as the companion e-book The Breakthrough CIO's Companion. He has spent over a decade providing strategy consulting services to Fortune 500 and 1000 companies. Patrick can be reached at email@example.com, and you can follow his blog at www.itbswatch.com. All opinions are his and may not represent those of his employer.