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In October-November 2017 we conducted a survey of 307 senior executives from companies headquartered in the US, UK and
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The Covid-19 pandemic has exposed a wealth of interconnections – between ecological and human wellbeing, between economic and environmental fragility, between social inequality and health outcomes, and more. The consequences of these connections are now filtering through, reshaping our society and economy.
In this setting, the need to integrate environmental, social and governance (ESG) factors when investing has become even more critical. Institutional investors must employ ESG not just to mitigate risks and identify opportunities, but to engage with companies to bring about the positive change needed to drive a sustainable economic recovery in the post-Covid world.
In order to understand how ESG could be both a new performance marker and a growth driver in this environment, as well as how institutional investors are using ESG to make investment decisions and to assess their own performance, The Economist Intelligence Unit (EIU), sponsored by UBS, surveyed 450 institutional investors working in asset and wealth management firms, corporate pension funds, endowment funds, family offices, government agencies, hedge funds, insurance companies, pension funds, sovereign wealth funds and reinsurers in North America, Europe and Asia-Pacific.
Download the report and infographic to learn more.
Charting the course for ocean sustainability in the Indian Ocean Rim is an Economist Intelligence Unit report, sponsored by Environment Agency Abu Dhabi and the Department of Economic Development Abu Dhabi, which highlights key ocean challenges facing the Indian Ocean Rim countries and showcases initiatives undertaken by governments and the private sector in the region to address these challenges.
Click here to view the report.
The urgency for change in Asia's food system comes largely from the fact that Asian populations are growing, urbanising and changing food tastes too quickly for many of the regions’ food systems to cope with. Asian cities are dense and are expected to expand by 578m people by 2030. China, Indonesia and India will account for three quarters of these new urban dwellers.
To study what are the biggest challenges for change, The Economist Intelligence Unit (EIU) surveyed 400 business leaders in Asia’s food industry. According to the respondents, 90% are concerned about their local food system’s ability to meet food security needs, but only 32% feel their organisations have the ability to determine the success of their food systems. Within this gap is a shifting balance of responsibility between the public and private sectors, a tension that needs to and can be strategically addressed.
In theory, new technologies drive digital transformation, but CIOs often find it’s not that easy. In fact, adopting new technologies to drive business results requires the CIO’s strategic involvement from the very beginning, from choosing the technologies to ensuring they’re working effectively across the enterprise.
CIOs’ executive brief: three ways to update IT skills for digital transformation
Keep your own IT skills current. “Read, read, read as much as you can,” advises Theresa Payton, CEO of Fortalice Solutions and former White House CIO. “Then ask yourself, ‘what am I going to do—while I’m transforming the business—that allows me to transform myself in my role?’” Take a multi-tactic approach to building IT staff skills. Wondering whether to train, hire or outsource? All of the above, advise IT leaders. “The skills of those who report to the CIO are much more technical than they used to be,” says Marc Probst, CIO of Intermountain Healthcare. Engage with tomorrow’s IT experts today. Jaguar Land Rover, anticipating a shortage of skilled engineers, has engaged with more than 2m young people in the UK, encouraging them to consider STEM (science, technology, engineering and maths) education through its Inspiring Tomorrow’s Engineers initiative. Next, the company plans to engage with 2m more young people, this time worldwide, by 2020.
The pace at which new technologies—cloud, big data analytics, virtual reality (VR), artificial intelligence (AI), robotics and more—are developing is breathtaking. But if you really want to hear CIOs gasp for air, ask them about the new demands CIOs face as they seek to turn clever IT innovations into real-world business transformation.
CIOs must manage increasing IT complexity and the growing demands of business stakeholders. As Simon Bolton, CIO of UK-based Jaguar Land Rover also notes, modernising business strategies and aligning them with emerging technologies remain a CIO imperative: “My biggest aspiration is to help Jaguar Land Rover to be seen as a technology leader outside of the company within the automotive space.
“We’ve seen the industry changes: electrification, connected cars, autonomous driving, etc. We need to transform our business so that we’re ready to maximise those opportunities. In today’s world, where customers’ expectations are changing very quickly, we need to have systems that can respond to those changing requirements.”
CIOs face the dual challenge of maintaining business critical systems while adapting the business to leverage new technologies. Renata Marques, Latin America CIO of Whirlpool, advises CIOs to “have a very solid and stable foundation that doesn't consume the agenda of innovation and digital transformation.”
And yet many CIOs and their staff are not necessarily prepared for all of this change and the major implications for the workforce and skills. In a recent survey conducted by McKinsey, more than 60% of business executives said that due to advancing automation and digitisation, they’ll need to retrain or replace more than a quarter of their workforce between now and 2023 [1].
To make many of these changes successfully, integration of business and IT knowledge will be essential. Ritesh Sarda, CIO of Sun Life Financial Hong Kong says:
“Technologies without the business acumen or those that fail to solve the relevant business problem are absolutely useless. I think CIOs have to become more business savvy and have to be integrated and engrained into the business so that we know how we can use technology to resolve business challenges and make things forward-looking from an industry perspective."
New demands = New opportunities
Although balancing traditional business needs with the desire for innovation is always a challenge, the same changes that have reshaped the role of the CIO have also created new opportunities for workforce transformation.
Indeed, one reason CIOs need new skills is the way IT has moved beyond the back office and into customer-facing products and services. Consider today’s new cars. Essentially rolling data centres, they’re equipped with computerised engine components, Wi-Fi networks, GPS navigation, backup cameras, lane-departure warning systems and more. Tomorrow promises even more onboard IT, including electric batteries, voice-activated controls and self-driving capabilities.
Alongside these new tools, customers’ growing IT savvy puts even more pressure on CIOs. At Jaguar Land Rover, designers work on a seven-year product life cycle. For traditional automotive designers and engineers, to create a highly complex vehicle, that may seem like the blink of an eye. But for today’s consumers, it’s more like an eternity.
One path forward may be the adoption and implementation of Agile practices. “We need to do all we can to remain agile,” Mr Bolton says. “That’s becoming ever more challenging as technology moves faster and faster. As a company, we need to wrap our heads around this and make sure we’re all going forward at that speed.”
Ms Marques of Whirlpool brought in an Agile coach into the IT function to train her team once a week: “We started to transform our projects by adopting Agile methodology and delivering technology to the business in a different way. This is something that we’ve worked on a lot, not to just to speed up our process, but to create this future of innovation.”
Mr Bolton of Jaguar agrees that these changes bring new opportunities for workforce organisation. Historically, Jaguar Land Rover’s strengths have been engineering, manufacturing and design. Today, the company seeks to add to those strengths by placing greater emphasis on technology.
“Increasingly, we’re going to have to demonstrate real leadership around technology,” Mr Bolton says. “That requires a shift in skills, not just in the technology function, but across the company.”
That said, non-IT employees aren’t as far behind as they used to be, and like many consumers, both IT and non-IT staff have gained technological sophistication too. “One of the changes we’re going through,” notes Mr Bolton, “is we’re insourcing—not for every skill—but we’re bringing back in certain areas of technology that we’ve outsourced over the past few years”.
Marc Probst, CIO of Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, has had a front-row view of the dramatic changes in overall familiarity with technology. Technical positions at Intermountain that formerly reported into IT and Mr Probst have shifted to its clinical and financial business units.
For Mr Probst, that means assuming a new role. “I’ve become more of a co-ordinator,” he says, “and a technical resource to make sure the things they’re doing fall within our security parameters and don’t blow up the system. It’s really different.”
Ms Marques of Whirlpool similarly describes the importance of being a technical resource for the business and understanding its strategic needs: “Our role as CIO is to be the conduit—to convert all the technical knowledge into a single strategy and not have a lot of different technologies everywhere not in conversation with our business.”
The value of reskilling and mentorship
Though IT employees still generally have a better understanding of technology than other employees, given the fast-changing nature of technology, many CIOs find that their current IT staff members still struggle to keep up with consumer or colleague expectations. It’s a rare IT department that employs experts in big data analytics, AI and VR. Yet these skills are increasingly in demand. Some even say the IT industry faces a talent shortage.
Two ways forward may be hiring for greater diversity and improving mentoring and internal training. In theory, that should not be difficult. One person advocating for those changes is Theresa Payton.
“Recruiters tell me, ‘there’s a war for talent, and we just can’t find qualified people.’ I reply, ‘Well, maybe it’s because you and the hiring managers are all looking for the same people. There are only so many unicorns to go around,’” says Ms Payton, CEO of cyber-security firm Fortalice Solutions. Ms Payton was also formerly the CIO at the White House under George W Bush’s presidency from 2006 to 2008—and the first woman to hold that position.
Instead, Ms Payton recommends that CIOs start by considering the personal qualities they’re looking for in new hires, what she calls “non-negotiables”. The rest, she maintains, can be gained with training.
Ms Payton practices what she preaches and has implemented a mentor-protégé programme at her cyber-security firm. She explains the rationale: “Take advantage of your own amazing people and have them be responsible for some of the retooling and retraining of your workforce. Make it part of their workday. Build it into your resource plans that you’re going to train, coach and mentor the next generation. Doing that creates that cross training, that esprit de corps.”
Ms Payton also works hard to keep her own skills and knowledge up-to-the-minute. While working in Washington, DC, she got into the habit of waking at 3:30 am to read and make other preparations before the day’s first briefing. “You have to constantly be a student of the job,” she says. “Stay close to the business, and stay close to the technologies.”
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To learn more about The EIU's Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] McKinsey, “Retraining and reskilling workers in the age of automation” January 2018. https://www.mckinsey.com/global-themes/future-of-organizations-and-work/...
Today these changes require going beyond simply introducing new technologies to digitise the company. As a result, we asked leading CIOs globally from across industries to explore how they are pioneering successful digital transformations to accelerate innovation and strategic enablement across their businesses.
In this Q&A, we ask Theresa Payton, CEO of Fortalice Solutions and former CIO of the White House, about the changing role of the CIO, today’s cyber threat landscape and best practices in security and IT operations.
Theresa Payton is a leading expert in cyber-security and IT strategy. Ms Payton is currently CEO of Fortalice Solutions, a cyber-security consulting firm, and was the first woman CIO at the White House, serving under president George W Bush from 2006 to 2008. Ms Payton also previously held leadership roles at Bank of America and Wachovia.
__________
EIU: How do you think the role of the CIO has changed since your time at the White House?
When I was CIO, which was from 2006 to 2008, we were right at the beginning of the social media revolution. People forget that the first iPhone was released in 2007. We can’t remember life without smartphones, but that was really a huge transformation in technology.
The things that have stayed the same are you absolutely have to have operational stability and resiliency. In an age where cybercrime constantly changes, as does the technology in the hands of people, the CIO has to foster the ability to adapt processes, people and security strategies to accommodate these changes. If the CIO ignores this, they will actually face outages in the long run and will not recover quickly from natural or man-made disasters.
You always have to walk that balance between how do you make sure that operation is resilient and secure, but at the same time, enable the staff that’s on the front lines of doing critically important business.
EIU: You were the first woman CIO in the White House. Tell us what you think about diversity and bringing more people into the technology industry.
A lot of progress has been made, but we still have so far to go. First of all, I am so grateful that president Bush made diversity and inclusion such a high priority during his administration.
I was equally thankful that I was the first female CIO at the White House. There was a wonderful level of professional courtesy and respect, and when you’re working 18-hour days with people, you tend to break down most barriers pretty quickly. And I am very proud of improving the overall technology and security platforms at the White House, as well as being able to recruit really great talent, including women and minorities, into the CIO team at the Executive Office of the President.
Within our own company, Fortalice, we do a mentor/protégé programme. When people come in and they haven’t done cyber before, they get assigned somebody in the company that’s their coach and mentor.
If you’re the best at what you do, you can do a lot of the training internally. Take advantage of your own amazing people and have them train and be responsible for some of the retooling and retraining of your own people. Make it part of their workday. Build it into your resource plans that you’re going to train, coach and mentor the next generation. It’s succession planning, and it’s, again, team talent, resiliency and operational stability. Doing that creates that cross training, that esprit de corps.
Of course, you’re going to have to spend some money on retooling and retraining, but you’re going to have an incredibly loyal employee that you’ve created in that process.
EIU: The White House is clearly a sensitive environment with a lot of mission critical information. How were you able to successfully manage security?
One of the strategies that I think was so successful at the White House, and the reason why we did not have a data breach while we were there, is I always think about things in zones of information, zones of protection and zones of need-to-know. We zoned off different parts of the operations within the White House. By creating those zones, you can create behavioral-based analytics about events.
The job of being CIO and responsible for security really has to start with the end-user case first, because then that’s how you will understand how cyber-criminals will actually try to take advantage of vulnerabilities in those use cases, and that’s at that level where you have to be thinking about protection. Once you know the critical assets the business must protect, you have to set daily battle rhythms for the team. This allows you to help the overall organisation stay focused on their day jobs while integrating security into the culture. The CIO can’t see security as a discrete function or a project, it has to be part of the service delivery.
EIU: What advice you would give to CIOs today?
The CIO job can be a little overwhelming because it is a massive undertaking in today’s day and age. You have the legacy systems that you have to maintain and operate, and the less sexy side of the CIO job: “Did you run payroll?” “Yeah, we made sure payroll ran.” There’s that least sexy side all the way to, are you actually transforming the business with really cool, cutting- and leading-edge technologies?
My counsel to CIOs is you need to be a constant student of your job. Whatever you thought made you successful to be here, throw some of that out the window, and reinvent yourself and reinvent your job on a regular basis.
Why are some companies successful? It’s because they’re reinventing themselves constantly as they see what the market demands are and what their competitors are doing. Then they can decide to be a fast follower, a total follower, a “no, I’m going to do my own thing”, or a leader. The CIO needs to be thinking about that.
EIU: Any best practices CIOs should remember when balancing these challenges and trying to reinvent themselves?
You have to stay close to the business and stay close to the technologies. Being a constant student of your job is easier said than done, but it’s actually never been easier than it is right now. Here are a few examples:
Pick something that along your career you were good at, and find ways to constantly keep learning. I started out as a developer. I’m not going to be as good as the developers I have working for me today because that’s what they do all day long. But just to make sure I keep my edge, I do online programming classes. Recently, I did one in Python.
Talk to smart people. I call them walk-abouts. I spend time talking to my team, and then our own CIOs and CISOs as clients. I ask them if you had to say what are your biggest three challenges this year, what are they and how are you going to tackle them? And you learn so much from other people. Conferences can be helpful as well. Take advantage of the information sharing that goes on at conferences.
Read, read, read as much as you can. I get up extra early in the morning. I got in the habit of getting up at 3:30 in the morning when I was in the White House to make sure that I could plan out my day and start reading before daily briefing started. If I wanted to make sure I had my day planned out and that I was being a student of my job, I had to get up extra early.
My biggest recommendation to CIOs everywhere is, every week, be thinking about what am I going to do that, as I’m transforming the business, allows me to transform myself in my role.
To learn more about The EIU’s Pioneering Leadership programme, find a full range of insights, including more Q&As, upcoming articles and an in-depth report, click here.
CIOs’ executive brief: three ways to update IT skills for digital transformation
Today these changes require going beyond simply introducing new technologies to digitise the company. As a result, we asked leading CIOs globally from across industries to explore how they are pioneering successful digital transformations to accelerate innovation and strategic enablement across their businesses.
In theory, new technologies drive digital transformation, but CIOs often find it’s not that easy. In fact, adopting new technologies to drive business results requires the CIO’s strategic involvement from the very beginning, from choosing the technologies to ensuring they’re working effectively across the enterprise.
“The CIO must be totally cognizant of all emerging technologies and solutions coming onto the market,” says Ritesh Sarda, CIO of Sun Life Financial Hong Kong. “But at the same time, technologies that fail to solve a relevant business problem are absolutely useless.”
Indeed, a recent survey of CIOs conducted by executive recruiter Harvey Nash and professional-services firms KPMG found that enterprise digital strategies were described as “very effective” by fewer than one in five IT leaders [1]. In another survey, conducted by IT advisory firm Gartner, more than 90% of respondents said their organisations haven’t yet reached “transformational” levels of maturity with data analytics, even though those companies’ CIOs have identified that technology as their number one investment priority [2].
Innovating with the customer in mind
Some CIOs, however, are doing an excellent job of identifying and evaluating new technologies for digital transformation. Increasingly, their organisations are doing the same with customer-facing products and services and implementing new technologies across their companies’ operations.
That’s the case at Whirlpool. The world’s leading home-appliance provider, Whirlpool ships more than 70m products a year, many of them digitally enabled. Various Whirlpool appliances now interact with artificial intelligence (AI) tools for analytics, automatic ordering services and several virtual assistants for voice control. Renata Marques, CIO of Whirlpool Latin America, and her IT team recently helped to develop a “smart” beer cooler, not yet on the market, that replenishes consumers’ beer supplies by detecting when beer is running out, then automatically ordering more from a partner marketplace. Moreover, the company recently acquired a mobile app called Yummly; it uses image recognition to inventory the food in a consumer’s pantry, then recommends recipes using only those ingredients on hand.
Ms Marques has encouraged her teams to leverage new technologies for consumer-facing innovation. The Latin America division, based in São Paulo, Brazil, brings in roughly a quarter of Whirlpool’s global sales, which totalled US$21bn last year. “Because digital transformation is part of our strategic agenda,” Ms Marques says, “our IT organisation works closely with engineering, marketing and other business areas.”
And Ms Marques is also adopting Agile, a methodology borrowed from software development, to speed up her new IT projects. Her team recently evaluated a new web platform using an Agile concept known as MVP. Short for minimum viable product, it provides just enough features to garner user feedback. “Agile is something we’ve worked on a lot,” Ms Marques says, “to not just speed up our process, but also create our future of innovation.”
For Ms Marques, “creating a future of innovation” includes a cloud-first strategy that has been key to helping her IT group meet business needs. For example, using the cloud, Whirlpool Latin America recently implemented a new commerce platform for its KitchenAid home appliance brand to improve the consumer experience. The project, though massive, was completed in less than five months. “Without our cloud-first strategy,” Ms Marques says, “we could never have delivered such a big project so quickly.”
Partnering for innovation
Partnerships are another way for CIOs to implement emerging technologies for digital transformation. It’s an approach that works well for Sun Life Financial, a Toronto-based provider of insurance, wealth and asset-management solutions to individuals and corporate clients.
Due to Sun Life’s size—it has 33,000 employees, offices in over 25 countries and assets under management in excess of C$930bn (US$736bn)—moving quickly on new technologies can be a challenge. “As a large enterprise, sometimes we cannot innovate that far,” says Mr Sarda, who joined Sun Life in 2006 and became CIO of its Hong Kong unit in 2016. “So we partner with accelerators and incubation centres where we can pick fintechs and partner with them to evolve a business idea.”
These partnerships have led to some innovative results. One partnership has resulted in Sun Life’s adoption of software robotic automation, also known as “tech bots”, to process customer applications that previously involved lots of painstaking paperwork. The software robots now mimic the work previously done by humans, including underwriting, examining historical records and reviewing claims records. “Where there are inherent system deficiencies, we can create bots rather than putting humans in to do the dirty jobs,” Mr Sarda says.
Another project enhanced by partnership is Sun Life’s implementation of chatbots. These AI implementations populate a website to answer customers’ frequently asked questions. Partners are also now working with Sun Life on blockchain, a platform for decentralised applications, and facial-recognition systems for identity authentication. At any given time, Mr Sarda and his team are partnering with as many as ten specialist companies. “Then,” he adds, “we see which ideas eventually become mature.”
DIY tech
At Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, CIO Marc Probst and his team have taken a different approach to new technologies: they build what they need and then turn their solutions into new products and services for the company.
One internally developed IT innovation at Intermountain has even led to the formation of a separate company. Called Empiric Health, it offers software designed to help surgical teams control their costs by assessing how different procedures like supply utilisation or staffing affect health outcomes. “That was actually a piece of software we wrote for our internal operating rooms,” Mr Probst says. “We found it was saving us tens of millions of dollars a year, so our people said, ‘Hmm…this may be something of value to other organisations.’”
And using emerging technologies to drive business innovation can also help create better outcomes for patient health. For example, Intermountain clinicians developed a care process model to guide care provision for acute respiratory disease syndrome (ARDS), an illness that’s often fatal. While the model reduced mortality rates, Mr Probst’s team was able to leverage AI and Intermountain’s data to not only replicate the model for ARDS but also identify additional risk factors to further improve the quality of care.
“That’s one of the very real powers of AI. It took what would have taken months or years and allowed it to happen in days,” says Mr Probst.
As Intermountain shows, digital transformation involves shifting advanced technology beyond the IT department’s walls, bringing IT and the business ever closer. Although sometimes challenging, the introduction of new tech offers meaningful change for patients, providers and staff.
Putting it all together
Though every organisation is at a different stage of their transformation, there are several practices CIOs can keep in mind along the way:
Stay aware of new technologies and potential use cases to meet new customer demands; Leverage partnerships for innovation to pool resources and take risks; and Be creative about translating IT solutions into business innovations.In the end, the opportunities offered by emerging technologies may be well worth their weight in gold.
To learn more about the Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] KPMG, “Press release, the Harvey Nash / KPMG CIO Survey 2017” May 23rd 2017, https://www.hnkpmgciosurvey.com/press-release/ [2] Gartner, “Gartner Survey shows organizations are slow to advance in data and analytics”, 2018 https://www.gartner.com/newsroom/id/3851963
In this Q&A, The EIU asks Renata Marques, CIO of Whirlpool Latin America, about the changing role of the CIO, how emerging technologies like cloud are enabling innovation and how businesses execute their digital transformation journeys.
Renata Marques is the CIO at Whirlpool Latin America, responsible for information technology and digital business transformation solutions. Ms Marques has held previous IT leadership roles at ABB and Monsanto.
__________EIU: How would you describe your role as a CIO today? What do you and your teams need to do to succeed looking forward?
My role as CIO is to be the conduit—to convert all the technical knowledge into a single strategy and not have a lot of different technologies everywhere not in conversation with our business. We should guide the business to use technology to enable their strategy, grow revenue and improve the consumer experience. So the changing nature of IT is our challenge.
Today, we are focused a lot on soft skills, to make sure that we hire people who are passionate for learning, comfortable taking risks, and very consumer and business focused. We understand that people with soft skills can adopt and learn new technologies much faster. Our internal IT teams are also consumers. They can use their own experience as a consumer to understand the business needs and to bring new capabilities to the company.
And to keep up, personally, I always feel that I need more. I am always looking for knowledge from other businesses and new research. I participate in events and conferences. As IT leaders, we must always be starving for new stuff.
EIU: What do you think about technology’s role in innovation?
We believe in innovation with a purpose. We work to fully understand the consumer and offer innovation that has meaning, strong rigour and focuses on the consumer’s benefit. We spend so much time and effort to understand what the consumer truly needs, for today and tomorrow.
That’s why we worked very hard last year on the consumer journey to understand their pain points, and through this experience, become able to design new services, with all the innovation and technology available in the market.
That said, digital transformation is part of our strategic agenda and not just our digital products and services, but everything that touches the consumer in all functions of the organisation: logistics, services, products, etc.
Our biggest projects will be on analytics and artificial intelligence (AI) to improve how we bring products and services to our customers. We are using AI for a new generation of websites to provide consumers more self-service and a better user experience. Nowadays, it’s not important to just sell the product, but to support the consumer during his or her entire user journey.
It’s important to remember, though, that keeping the lights on is part of our agenda too. These are the basics. We should make sure the business is running very well and reliably. I think the secret there is: have a very solid and stable foundation that doesn’t consume the agenda of innovation and digital transformation. When you have a lot of issues here, it’s a problem, because then you don’t have time to focus on digital transformation.
EIU: Has cloud specifically affected your ability to deliver innovations?
We recently launched a B2B e-commerce platform that’s being implemented in Latin America to support spare parts for KitchenAid, our home appliance brand. This project was implemented in four and a half months. We used and are continuing to use an Agile development model. From the business point of view, the main driver of the initiative was the customer experience—to set clear pricing policies, update the catalogue, maintain the online store 24-7, improve wholesale services and so on. Without a cloud first strategy, we would never have been able to deliver a big project like that in four and a half months. Now we can.
Using the cloud first strategy, we can shift our agenda to be more business driven and innovative. When you are in the cloud, you cut immediately to the project phase. It’s much faster to contract services and infrastructure in the cloud.
EIU: How do you think about and manage failure as part of digital transformation?
We have some key performance indicators (KPIs) for the proof of concepts and minimum viable products (MVPs) that we perform during the year. We have a percentage that we can let fail, and it’s not a bad thing. We can learn from that, and that’s why starting small is really important, because starting small means we’ll be learning. We may fail, but if we fail, we can move faster to another alternative.
I don’t think that failure is the problem. We don’t want to make the same mistake over and over again, but if you fail and you learn from that—that is something that is very supported by the organisation. It’s been a cultural change.
EIU: Organisations are often in many different stages of their digital transformation. How would you describe your journey?
The first cycle of my journey at Whirlpool was to focus on technical debt elimination. I focused on what systems we should make stable and integrate. For example, we integrated our enterprise resource planning (ERP) system and moved it to a cloud as well. With that, we created a ready-for-use platform that would not consume our digital agenda but would actually be plugged into it.
More recently, I was able to focus more on digital transformation, to engage the organisation to shift and consolidate the way we create and deliver solutions, to have a clear understanding of business protocols, to leverage our methodologies and to encourage creativity, innovation, co-creation and partnership. This is the last two years’ agenda that could happen only because we stabilised the other systems.
The next cycle will be to consolidate this innovation and collaboration across the organisation to provide consistency and integration across all business units. We, as a big company, have many different functions, areas and departments. We want to continue this phase of not only focusing on the individual business function needs but to also engage all functions to work together and embrace digital transformation.
To learn more about The EIU’s Pioneering Leadership programme, find a full range of insights, including more Q&As, upcoming articles and an in-depth report, click here.
CIOs find digital transformation often demands not only technological change but also a re-imagination of roles, skills and culture. This report examines how CIOs are changing themselves and their organisations to ready themselves for the future.
CIOs’ executive brief: three ways to update IT skills for digital transformation
Keep your own IT skills current. “Read, read, read as much as you can,” advises Theresa Payton, CEO of Fortalice Solutions and former White House CIO. “Then ask yourself, ‘what am I going to do—while I’m transforming the business—that allows me to transform myself in my role?’” Take a multi-tactic approach to building IT staff skills. Wondering whether to train, hire or outsource? All of the above, advise IT leaders. “The skills of those who report to the CIO are much more technical than they used to be,” says Marc Probst, CIO of Intermountain Healthcare. Engage with tomorrow’s IT experts today. Jaguar Land Rover, anticipating a shortage of skilled engineers, has engaged with more than 2m young people in the UK, encouraging them to consider STEM (science, technology, engineering and maths) education through its Inspiring Tomorrow’s Engineers initiative. Next, the company plans to engage with 2m more young people, this time worldwide, by 2020.
The pace at which new technologies—cloud, big data analytics, virtual reality (VR), artificial intelligence (AI), robotics and more—are developing is breathtaking. But if you really want to hear CIOs gasp for air, ask them about the new demands CIOs face as they seek to turn clever IT innovations into real-world business transformation.
CIOs must manage increasing IT complexity and the growing demands of business stakeholders. As Simon Bolton, CIO of UK-based Jaguar Land Rover also notes, modernising business strategies and aligning them with emerging technologies remain a CIO imperative: “My biggest aspiration is to help Jaguar Land Rover to be seen as a technology leader outside of the company within the automotive space.
“We’ve seen the industry changes: electrification, connected cars, autonomous driving, etc. We need to transform our business so that we’re ready to maximise those opportunities. In today’s world, where customers’ expectations are changing very quickly, we need to have systems that can respond to those changing requirements.”
CIOs face the dual challenge of maintaining business critical systems while adapting the business to leverage new technologies. Renata Marques, Latin America CIO of Whirlpool, advises CIOs to “have a very solid and stable foundation that doesn't consume the agenda of innovation and digital transformation.”
And yet many CIOs and their staff are not necessarily prepared for all of this change and the major implications for the workforce and skills. In a recent survey conducted by McKinsey, more than 60% of business executives said that due to advancing automation and digitisation, they’ll need to retrain or replace more than a quarter of their workforce between now and 2023 [1].
To make many of these changes successfully, integration of business and IT knowledge will be essential. Ritesh Sarda, CIO of Sun Life Financial Hong Kong says:
“Technologies without the business acumen or those that fail to solve the relevant business problem are absolutely useless. I think CIOs have to become more business savvy and have to be integrated and engrained into the business so that we know how we can use technology to resolve business challenges and make things forward-looking from an industry perspective."
New demands = New opportunities
Although balancing traditional business needs with the desire for innovation is always a challenge, the same changes that have reshaped the role of the CIO have also created new opportunities for workforce transformation.
Indeed, one reason CIOs need new skills is the way IT has moved beyond the back office and into customer-facing products and services. Consider today’s new cars. Essentially rolling data centres, they’re equipped with computerised engine components, Wi-Fi networks, GPS navigation, backup cameras, lane-departure warning systems and more. Tomorrow promises even more onboard IT, including electric batteries, voice-activated controls and self-driving capabilities.
Alongside these new tools, customers’ growing IT savvy puts even more pressure on CIOs. At Jaguar Land Rover, designers work on a seven-year product life cycle. For traditional automotive designers and engineers, to create a highly complex vehicle, that may seem like the blink of an eye. But for today’s consumers, it’s more like an eternity.
One path forward may be the adoption and implementation of Agile practices. “We need to do all we can to remain agile,” Mr Bolton says. “That’s becoming ever more challenging as technology moves faster and faster. As a company, we need to wrap our heads around this and make sure we’re all going forward at that speed.”
Ms Marques of Whirlpool brought in an Agile coach into the IT function to train her team once a week: “We started to transform our projects by adopting Agile methodology and delivering technology to the business in a different way. This is something that we’ve worked on a lot, not to just to speed up our process, but to create this future of innovation.”
Mr Bolton of Jaguar agrees that these changes bring new opportunities for workforce organisation. Historically, Jaguar Land Rover’s strengths have been engineering, manufacturing and design. Today, the company seeks to add to those strengths by placing greater emphasis on technology.
“Increasingly, we’re going to have to demonstrate real leadership around technology,” Mr Bolton says. “That requires a shift in skills, not just in the technology function, but across the company.”
That said, non-IT employees aren’t as far behind as they used to be, and like many consumers, both IT and non-IT staff have gained technological sophistication too. “One of the changes we’re going through,” notes Mr Bolton, “is we’re insourcing—not for every skill—but we’re bringing back in certain areas of technology that we’ve outsourced over the past few years”.
Marc Probst, CIO of Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, has had a front-row view of the dramatic changes in overall familiarity with technology. Technical positions at Intermountain that formerly reported into IT and Mr Probst have shifted to its clinical and financial business units.
For Mr Probst, that means assuming a new role. “I’ve become more of a co-ordinator,” he says, “and a technical resource to make sure the things they’re doing fall within our security parameters and don’t blow up the system. It’s really different.”
Ms Marques of Whirlpool similarly describes the importance of being a technical resource for the business and understanding its strategic needs: “Our role as CIO is to be the conduit—to convert all the technical knowledge into a single strategy and not have a lot of different technologies everywhere not in conversation with our business.”
The value of reskilling and mentorship
Though IT employees still generally have a better understanding of technology than other employees, given the fast-changing nature of technology, many CIOs find that their current IT staff members still struggle to keep up with consumer or colleague expectations. It’s a rare IT department that employs experts in big data analytics, AI and VR. Yet these skills are increasingly in demand. Some even say the IT industry faces a talent shortage.
Two ways forward may be hiring for greater diversity and improving mentoring and internal training. In theory, that should not be difficult. One person advocating for those changes is Theresa Payton.
“Recruiters tell me, ‘there’s a war for talent, and we just can’t find qualified people.’ I reply, ‘Well, maybe it’s because you and the hiring managers are all looking for the same people. There are only so many unicorns to go around,’” says Ms Payton, CEO of cyber-security firm Fortalice Solutions. Ms Payton was also formerly the CIO at the White House under George W Bush’s presidency from 2006 to 2008—and the first woman to hold that position.
Instead, Ms Payton recommends that CIOs start by considering the personal qualities they’re looking for in new hires, what she calls “non-negotiables”. The rest, she maintains, can be gained with training.
Ms Payton practices what she preaches and has implemented a mentor-protégé programme at her cyber-security firm. She explains the rationale: “Take advantage of your own amazing people and have them be responsible for some of the retooling and retraining of your workforce. Make it part of their workday. Build it into your resource plans that you’re going to train, coach and mentor the next generation. Doing that creates that cross training, that esprit de corps.”
Ms Payton also works hard to keep her own skills and knowledge up-to-the-minute. While working in Washington, DC, she got into the habit of waking at 3:30 am to read and make other preparations before the day’s first briefing. “You have to constantly be a student of the job,” she says. “Stay close to the business, and stay close to the technologies.”
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To learn more about The EIU's Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] McKinsey, “Retraining and reskilling workers in the age of automation” January 2018. https://www.mckinsey.com/global-themes/future-of-organizations-and-work/...
In theory, new technologies drive digital transformation, but CIOs often find it’s not that easy. In fact, adopting new technologies to drive business results requires the CIO’s strategic involvement from the very beginning, from choosing the technologies to ensuring they’re working effectively across the enterprise.
“The CIO must be totally cognizant of all emerging technologies and solutions coming onto the market,” says Ritesh Sarda, CIO of Sun Life Financial Hong Kong. “But at the same time, technologies that fail to solve a relevant business problem are absolutely useless.”
Indeed, a recent survey of CIOs conducted by executive recruiter Harvey Nash and professional-services firms KPMG found that enterprise digital strategies were described as “very effective” by fewer than one in five IT leaders [1]. In another survey, conducted by IT advisory firm Gartner, more than 90% of respondents said their organisations haven’t yet reached “transformational” levels of maturity with data analytics, even though those companies’ CIOs have identified that technology as their number one investment priority [2].
Innovating with the customer in mind
Some CIOs, however, are doing an excellent job of identifying and evaluating new technologies for digital transformation. Increasingly, their organisations are doing the same with customer-facing products and services and implementing new technologies across their companies’ operations.
That’s the case at Whirlpool. The world’s leading home-appliance provider, Whirlpool ships more than 70m products a year, many of them digitally enabled. Various Whirlpool appliances now interact with artificial intelligence (AI) tools for analytics, automatic ordering services and several virtual assistants for voice control. Renata Marques, CIO of Whirlpool Latin America, and her IT team recently helped to develop a “smart” beer cooler, not yet on the market, that replenishes consumers’ beer supplies by detecting when beer is running out, then automatically ordering more from a partner marketplace. Moreover, the company recently acquired a mobile app called Yummly; it uses image recognition to inventory the food in a consumer’s pantry, then recommends recipes using only those ingredients on hand.
Ms Marques has encouraged her teams to leverage new technologies for consumer-facing innovation. The Latin America division, based in São Paulo, Brazil, brings in roughly a quarter of Whirlpool’s global sales, which totalled US$21bn last year. “Because digital transformation is part of our strategic agenda,” Ms Marques says, “our IT organisation works closely with engineering, marketing and other business areas.”
And Ms Marques is also adopting Agile, a methodology borrowed from software development, to speed up her new IT projects. Her team recently evaluated a new web platform using an Agile concept known as MVP. Short for minimum viable product, it provides just enough features to garner user feedback. “Agile is something we’ve worked on a lot,” Ms Marques says, “to not just speed up our process, but also create our future of innovation.”
For Ms Marques, “creating a future of innovation” includes a cloud-first strategy that has been key to helping her IT group meet business needs. For example, using the cloud, Whirlpool Latin America recently implemented a new commerce platform for its KitchenAid home appliance brand to improve the consumer experience. The project, though massive, was completed in less than five months. “Without our cloud-first strategy,” Ms Marques says, “we could never have delivered such a big project so quickly.”
Partnering for innovation
Partnerships are another way for CIOs to implement emerging technologies for digital transformation. It’s an approach that works well for Sun Life Financial, a Toronto-based provider of insurance, wealth and asset-management solutions to individuals and corporate clients.
Due to Sun Life’s size—it has 33,000 employees, offices in over 25 countries and assets under management in excess of C$930bn (US$736bn)—moving quickly on new technologies can be a challenge. “As a large enterprise, sometimes we cannot innovate that far,” says Mr Sarda, who joined Sun Life in 2006 and became CIO of its Hong Kong unit in 2016. “So we partner with accelerators and incubation centres where we can pick fintechs and partner with them to evolve a business idea.”
These partnerships have led to some innovative results. One partnership has resulted in Sun Life’s adoption of software robotic automation, also known as “tech bots”, to process customer applications that previously involved lots of painstaking paperwork. The software robots now mimic the work previously done by humans, including underwriting, examining historical records and reviewing claims records. “Where there are inherent system deficiencies, we can create bots rather than putting humans in to do the dirty jobs,” Mr Sarda says.
Another project enhanced by partnership is Sun Life’s implementation of chatbots. These AI implementations populate a website to answer customers’ frequently asked questions. Partners are also now working with Sun Life on blockchain, a platform for decentralised applications, and facial-recognition systems for identity authentication. At any given time, Mr Sarda and his team are partnering with as many as ten specialist companies. “Then,” he adds, “we see which ideas eventually become mature.”
DIY tech
At Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, CIO Marc Probst and his team have taken a different approach to new technologies: they build what they need and then turn their solutions into new products and services for the company.
One internally developed IT innovation at Intermountain has even led to the formation of a separate company. Called Empiric Health, it offers software designed to help surgical teams control their costs by assessing how different procedures like supply utilisation or staffing affect health outcomes. “That was actually a piece of software we wrote for our internal operating rooms,” Mr Probst says. “We found it was saving us tens of millions of dollars a year, so our people said, ‘Hmm…this may be something of value to other organisations.’”
And using emerging technologies to drive business innovation can also help create better outcomes for patient health. For example, Intermountain clinicians developed a care process model to guide care provision for acute respiratory disease syndrome (ARDS), an illness that’s often fatal. While the model reduced mortality rates, Mr Probst’s team was able to leverage AI and Intermountain’s data to not only replicate the model for ARDS but also identify additional risk factors to further improve the quality of care.
“That’s one of the very real powers of AI. It took what would have taken months or years and allowed it to happen in days,” says Mr Probst.
As Intermountain shows, digital transformation involves shifting advanced technology beyond the IT department’s walls, bringing IT and the business ever closer. Although sometimes challenging, the introduction of new tech offers meaningful change for patients, providers and staff.
Putting it all together
Though every organisation is at a different stage of their transformation, there are several practices CIOs can keep in mind along the way:
Stay aware of new technologies and potential use cases to meet new customer demands; Leverage partnerships for innovation to pool resources and take risks; and Be creative about translating IT solutions into business innovations.In the end, the opportunities offered by emerging technologies may be well worth their weight in gold.
To learn more about the Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] KPMG, “Press release, the Harvey Nash / KPMG CIO Survey 2017” May 23rd 2017, https://www.hnkpmgciosurvey.com/press-release/ [2] Gartner, “Gartner Survey shows organizations are slow to advance in data and analytics”, 2018 https://www.gartner.com/newsroom/id/3851963
In this Q&A, The EIU asks Ritesh Sarda, CIO of Sun Life Financial Hong Kong, about the changing role of the CIO, digital transformation in the financial services industry and how CIOs can leverage emerging technologies to enable their business strategies. Ritesh Sarda is the CIO of Sun Life Financial Hong Kong.
Mr Sarda has been in the financial services industry for 18 years and held senior IT roles in Singapore, Japan, India and the Philippines. He has led large digital transformation projects in Asia and North America and previously worked for GE Capital, Aon Hewitt and IBM.
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The role of the CIO has moved beyond simply managing technology to offering a competitive advantage for business. A great CIO is an absolutely unique differentiator. Throughout my career and during my time at Sun Life Financial, I’ve learned there are two aspects of the job that have become crucial to maintaining that differentiation.
First, it’s important for a CIO to be cognizant of all the emerging technologies and solutions in the market—not just the local market but also the global market and in global industries. You have to look beyond your own industry and geography. Given our global reach at Sun Life Financial, we always look to Singapore, China and Canada for innovative business scenarios and usage of advanced technology. For example, we admire WeChat and Alipay-based payment systems that enable clients to use their platform of choice to make payments.
Second, technologies without business acumen or those that fail to solve the relevant business problem are absolutely useless. CIOs have to become more business savvy and have to be integrated and engrained into the business so that we know how we can use technology to resolve business challenges and make things forward-looking from an industry perspective.
Bottom line, the CIO has moved from the back office to the boardroom. There’s no boardroom conversation that happens without the CIO involved.
The insurance business, primarily the life insurance business, for a very long time has been a very manual, operationally based world. When we look at my role as CIO today, which includes legacy work, digital transformation, information management, security and more, to address this challenge, we must consider a few key principles.
Our digital strategy is based on making sure that: first, we become more client-centric and, second, we empower and enable our financial advisers to become more well informed and connected with clients than they’ve ever been. Client-centric thinking is paramount from a digital transformation perspective because most of our relationships are with financial advisers. We don’t necessarily have a well-connected client.
For our end-user clients, we built a mobile application, the my Sun Life client app. Clients can see their entire portfolio in a single view, across multiple relationships they might have with Sun Life. If they want to use the app for electronic servicing, to change basic contact information, update beneficiary information or even file electronic claims, it enables them to do that.
We’re working on a mobile-based point of sale system that enables our advisers to complete the sales process on an iPad. They will be able to do financial need analyses, proposal and sales illustrations, and the whole application process, including the payment and underwriting. This facilitates an almost straight-through processing of applications and near-real-time issuance of policy contract to clients.
Finally, we’re working on the adviser home office mobile app, an adviser-servicing platform that enables advisers to respond to client queries more quickly. And as advisers learn what life-changing moments are happening in clients’ lives, the app enables them to do maybe more upselling.
EIU: How do you evaluate digital transformation projects?
When we started a few years back, evaluation was more about keeping up with market changes. Over the last few years, we have matured, and today the key performance indicators (KPIs) are wide ranging and not necessarily only financial KPIs but also the softer KPIs, including adviser churn ratios, client retention, returning and repeat clients, opportunities to do cross-sells and upsells, our Net Promoter Scores and so on.
We now have the right metrics to determine the value of everything we do for client experience, adviser efficiency and operational efficiency. It’s easy to put fancy, front-end digital assets in front of clients and advisers but they don’t help if we have broken operational processes. So, the metrics are also about operational efficiency in terms of how much straight-through processing are we able to do? How are we making our processes more automated?
EIU: How are you leveraging emerging technologies to make those improvements in operational efficiency?
We’re using robotic process automation to make sure that wherever there are inherent system deficiencies, we are able to work on them without having humans do the dirty jobs, and instead have bots streamline those processes. We are using bots in two areas.
One is where there is a lot of manual process, for example, when an application comes through paper or electronically, to look at underwriting, amount histories and existing client claims records. Most often, the operational user has to enter multiple systems to pull out the information. Now, a bot will mimic human behaviour to enter multiple systems, search for the right information and present it to the user to make the sale more quickly.
A second example is in the contact centre. When a client calls up, normally customer services people have to go into multiple systems to find the right information. Now, all they do is fire a bot, and the bot extracts the right information to answer the customer call.
We’ve also done proof of concepts with chatbots that use natural language processing (NLP) to interpret client conversations and conduct system queries to fetch the relevant information from the backend system. We plan to deploy some in the near future.
All of these projects have a very strong layer of data and analytics that serve as glue between the adviser and client. If a client contacts Sun Life—via an adviser, branch offices or the contact centre—everybody gets the holistic view of client interaction across these digital assets.
Data and analytics are also helping us make sense of client behaviours; to do better client segmentations; to make more appropriate and relevant product design based on client demographics; and to facilitate lead generation and outreach to target client segments based on their stage of life, product requirements and so on.
In a nutshell, adviser-oriented, client-oriented, and empowered by data and analytics is what our digital transformation looks like. It lets us address our business challenges and provide deeper insights and recommendations to our clients to help them meet their financial goals.
To learn more about The EIU’s Pioneering Leadership programme, find a full range of insights, including more Q&As, upcoming articles and an in-depth report, here.
In this Q&A, we ask Theresa Payton, CEO of Fortalice Solutions and former CIO of the White House, about the changing role of the CIO, today’s cyber threat landscape and best practices in security and IT operations.
Theresa Payton is a leading expert in cyber-security and IT strategy. Ms Payton is currently CEO of Fortalice Solutions, a cyber-security consulting firm, and was the first woman CIO at the White House, serving under president George W Bush from 2006 to 2008. Ms Payton also previously held leadership roles at Bank of America and Wachovia.
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Today these changes require going beyond simply introducing new technologies to digitise the company. As a result, we asked leading CIOs globally from across industries to explore how they are pioneering successful digital transformations to accelerate innovation and strategic enablement across their businesses.
CIOs’ executive brief: three ways to update IT skills for digital transformation
Keep your own IT skills current. “Read, read, read as much as you can,” advises Theresa Payton, CEO of Fortalice Solutions and former White House CIO. “Then ask yourself, ‘what am I going to do—while I’m transforming the business—that allows me to transform myself in my role?’” Take a multi-tactic approach to building IT staff skills. Wondering whether to train, hire or outsource? All of the above, advise IT leaders. “The skills of those who report to the CIO are much more technical than they used to be,” says Marc Probst, CIO of Intermountain Healthcare. Engage with tomorrow’s IT experts today. Jaguar Land Rover, anticipating a shortage of skilled engineers, has engaged with more than 2m young people in the UK, encouraging them to consider STEM (science, technology, engineering and maths) education through its Inspiring Tomorrow’s Engineers initiative. Next, the company plans to engage with 2m more young people, this time worldwide, by 2020.
The pace at which new technologies—cloud, big data analytics, virtual reality (VR), artificial intelligence (AI), robotics and more—are developing is breathtaking. But if you really want to hear CIOs gasp for air, ask them about the new demands CIOs face as they seek to turn clever IT innovations into real-world business transformation.
CIOs must manage increasing IT complexity and the growing demands of business stakeholders. As Simon Bolton, CIO of UK-based Jaguar Land Rover also notes, modernising business strategies and aligning them with emerging technologies remain a CIO imperative: “My biggest aspiration is to help Jaguar Land Rover to be seen as a technology leader outside of the company within the automotive space.
“We’ve seen the industry changes: electrification, connected cars, autonomous driving, etc. We need to transform our business so that we’re ready to maximise those opportunities. In today’s world, where customers’ expectations are changing very quickly, we need to have systems that can respond to those changing requirements.”
CIOs face the dual challenge of maintaining business critical systems while adapting the business to leverage new technologies. Renata Marques, Latin America CIO of Whirlpool, advises CIOs to “have a very solid and stable foundation that doesn't consume the agenda of innovation and digital transformation.”
And yet many CIOs and their staff are not necessarily prepared for all of this change and the major implications for the workforce and skills. In a recent survey conducted by McKinsey, more than 60% of business executives said that due to advancing automation and digitisation, they’ll need to retrain or replace more than a quarter of their workforce between now and 2023 [1].
To make many of these changes successfully, integration of business and IT knowledge will be essential. Ritesh Sarda, CIO of Sun Life Financial Hong Kong says:
“Technologies without the business acumen or those that fail to solve the relevant business problem are absolutely useless. I think CIOs have to become more business savvy and have to be integrated and engrained into the business so that we know how we can use technology to resolve business challenges and make things forward-looking from an industry perspective."
New demands = New opportunities
Although balancing traditional business needs with the desire for innovation is always a challenge, the same changes that have reshaped the role of the CIO have also created new opportunities for workforce transformation.
Indeed, one reason CIOs need new skills is the way IT has moved beyond the back office and into customer-facing products and services. Consider today’s new cars. Essentially rolling data centres, they’re equipped with computerised engine components, Wi-Fi networks, GPS navigation, backup cameras, lane-departure warning systems and more. Tomorrow promises even more onboard IT, including electric batteries, voice-activated controls and self-driving capabilities.
Alongside these new tools, customers’ growing IT savvy puts even more pressure on CIOs. At Jaguar Land Rover, designers work on a seven-year product life cycle. For traditional automotive designers and engineers, to create a highly complex vehicle, that may seem like the blink of an eye. But for today’s consumers, it’s more like an eternity.
One path forward may be the adoption and implementation of Agile practices. “We need to do all we can to remain agile,” Mr Bolton says. “That’s becoming ever more challenging as technology moves faster and faster. As a company, we need to wrap our heads around this and make sure we’re all going forward at that speed.”
Ms Marques of Whirlpool brought in an Agile coach into the IT function to train her team once a week: “We started to transform our projects by adopting Agile methodology and delivering technology to the business in a different way. This is something that we’ve worked on a lot, not to just to speed up our process, but to create this future of innovation.”
Mr Bolton of Jaguar agrees that these changes bring new opportunities for workforce organisation. Historically, Jaguar Land Rover’s strengths have been engineering, manufacturing and design. Today, the company seeks to add to those strengths by placing greater emphasis on technology.
“Increasingly, we’re going to have to demonstrate real leadership around technology,” Mr Bolton says. “That requires a shift in skills, not just in the technology function, but across the company.”
That said, non-IT employees aren’t as far behind as they used to be, and like many consumers, both IT and non-IT staff have gained technological sophistication too. “One of the changes we’re going through,” notes Mr Bolton, “is we’re insourcing—not for every skill—but we’re bringing back in certain areas of technology that we’ve outsourced over the past few years”.
Marc Probst, CIO of Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, has had a front-row view of the dramatic changes in overall familiarity with technology. Technical positions at Intermountain that formerly reported into IT and Mr Probst have shifted to its clinical and financial business units.
For Mr Probst, that means assuming a new role. “I’ve become more of a co-ordinator,” he says, “and a technical resource to make sure the things they’re doing fall within our security parameters and don’t blow up the system. It’s really different.”
Ms Marques of Whirlpool similarly describes the importance of being a technical resource for the business and understanding its strategic needs: “Our role as CIO is to be the conduit—to convert all the technical knowledge into a single strategy and not have a lot of different technologies everywhere not in conversation with our business.”
The value of reskilling and mentorship
Though IT employees still generally have a better understanding of technology than other employees, given the fast-changing nature of technology, many CIOs find that their current IT staff members still struggle to keep up with consumer or colleague expectations. It’s a rare IT department that employs experts in big data analytics, AI and VR. Yet these skills are increasingly in demand. Some even say the IT industry faces a talent shortage.
Two ways forward may be hiring for greater diversity and improving mentoring and internal training. In theory, that should not be difficult. One person advocating for those changes is Theresa Payton.
“Recruiters tell me, ‘there’s a war for talent, and we just can’t find qualified people.’ I reply, ‘Well, maybe it’s because you and the hiring managers are all looking for the same people. There are only so many unicorns to go around,’” says Ms Payton, CEO of cyber-security firm Fortalice Solutions. Ms Payton was also formerly the CIO at the White House under George W Bush’s presidency from 2006 to 2008—and the first woman to hold that position.
Instead, Ms Payton recommends that CIOs start by considering the personal qualities they’re looking for in new hires, what she calls “non-negotiables”. The rest, she maintains, can be gained with training.
Ms Payton practices what she preaches and has implemented a mentor-protégé programme at her cyber-security firm. She explains the rationale: “Take advantage of your own amazing people and have them be responsible for some of the retooling and retraining of your workforce. Make it part of their workday. Build it into your resource plans that you’re going to train, coach and mentor the next generation. Doing that creates that cross training, that esprit de corps.”
Ms Payton also works hard to keep her own skills and knowledge up-to-the-minute. While working in Washington, DC, she got into the habit of waking at 3:30 am to read and make other preparations before the day’s first briefing. “You have to constantly be a student of the job,” she says. “Stay close to the business, and stay close to the technologies.”
~~~~~~~~~~~
To learn more about The EIU's Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] McKinsey, “Retraining and reskilling workers in the age of automation” January 2018. https://www.mckinsey.com/global-themes/future-of-organizations-and-work/...
In theory, new technologies drive digital transformation, but CIOs often find it’s not that easy. In fact, adopting new technologies to drive business results requires the CIO’s strategic involvement from the very beginning, from choosing the technologies to ensuring they’re working effectively across the enterprise.
“The CIO must be totally cognizant of all emerging technologies and solutions coming onto the market,” says Ritesh Sarda, CIO of Sun Life Financial Hong Kong. “But at the same time, technologies that fail to solve a relevant business problem are absolutely useless.”
Indeed, a recent survey of CIOs conducted by executive recruiter Harvey Nash and professional-services firms KPMG found that enterprise digital strategies were described as “very effective” by fewer than one in five IT leaders [1]. In another survey, conducted by IT advisory firm Gartner, more than 90% of respondents said their organisations haven’t yet reached “transformational” levels of maturity with data analytics, even though those companies’ CIOs have identified that technology as their number one investment priority [2].
Innovating with the customer in mind
Some CIOs, however, are doing an excellent job of identifying and evaluating new technologies for digital transformation. Increasingly, their organisations are doing the same with customer-facing products and services and implementing new technologies across their companies’ operations.
That’s the case at Whirlpool. The world’s leading home-appliance provider, Whirlpool ships more than 70m products a year, many of them digitally enabled. Various Whirlpool appliances now interact with artificial intelligence (AI) tools for analytics, automatic ordering services and several virtual assistants for voice control. Renata Marques, CIO of Whirlpool Latin America, and her IT team recently helped to develop a “smart” beer cooler, not yet on the market, that replenishes consumers’ beer supplies by detecting when beer is running out, then automatically ordering more from a partner marketplace. Moreover, the company recently acquired a mobile app called Yummly; it uses image recognition to inventory the food in a consumer’s pantry, then recommends recipes using only those ingredients on hand.
Ms Marques has encouraged her teams to leverage new technologies for consumer-facing innovation. The Latin America division, based in São Paulo, Brazil, brings in roughly a quarter of Whirlpool’s global sales, which totalled US$21bn last year. “Because digital transformation is part of our strategic agenda,” Ms Marques says, “our IT organisation works closely with engineering, marketing and other business areas.”
And Ms Marques is also adopting Agile, a methodology borrowed from software development, to speed up her new IT projects. Her team recently evaluated a new web platform using an Agile concept known as MVP. Short for minimum viable product, it provides just enough features to garner user feedback. “Agile is something we’ve worked on a lot,” Ms Marques says, “to not just speed up our process, but also create our future of innovation.”
For Ms Marques, “creating a future of innovation” includes a cloud-first strategy that has been key to helping her IT group meet business needs. For example, using the cloud, Whirlpool Latin America recently implemented a new commerce platform for its KitchenAid home appliance brand to improve the consumer experience. The project, though massive, was completed in less than five months. “Without our cloud-first strategy,” Ms Marques says, “we could never have delivered such a big project so quickly.”
Partnering for innovation
Partnerships are another way for CIOs to implement emerging technologies for digital transformation. It’s an approach that works well for Sun Life Financial, a Toronto-based provider of insurance, wealth and asset-management solutions to individuals and corporate clients.
Due to Sun Life’s size—it has 33,000 employees, offices in over 25 countries and assets under management in excess of C$930bn (US$736bn)—moving quickly on new technologies can be a challenge. “As a large enterprise, sometimes we cannot innovate that far,” says Mr Sarda, who joined Sun Life in 2006 and became CIO of its Hong Kong unit in 2016. “So we partner with accelerators and incubation centres where we can pick fintechs and partner with them to evolve a business idea.”
These partnerships have led to some innovative results. One partnership has resulted in Sun Life’s adoption of software robotic automation, also known as “tech bots”, to process customer applications that previously involved lots of painstaking paperwork. The software robots now mimic the work previously done by humans, including underwriting, examining historical records and reviewing claims records. “Where there are inherent system deficiencies, we can create bots rather than putting humans in to do the dirty jobs,” Mr Sarda says.
Another project enhanced by partnership is Sun Life’s implementation of chatbots. These AI implementations populate a website to answer customers’ frequently asked questions. Partners are also now working with Sun Life on blockchain, a platform for decentralised applications, and facial-recognition systems for identity authentication. At any given time, Mr Sarda and his team are partnering with as many as ten specialist companies. “Then,” he adds, “we see which ideas eventually become mature.”
DIY tech
At Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, CIO Marc Probst and his team have taken a different approach to new technologies: they build what they need and then turn their solutions into new products and services for the company.
One internally developed IT innovation at Intermountain has even led to the formation of a separate company. Called Empiric Health, it offers software designed to help surgical teams control their costs by assessing how different procedures like supply utilisation or staffing affect health outcomes. “That was actually a piece of software we wrote for our internal operating rooms,” Mr Probst says. “We found it was saving us tens of millions of dollars a year, so our people said, ‘Hmm…this may be something of value to other organisations.’”
And using emerging technologies to drive business innovation can also help create better outcomes for patient health. For example, Intermountain clinicians developed a care process model to guide care provision for acute respiratory disease syndrome (ARDS), an illness that’s often fatal. While the model reduced mortality rates, Mr Probst’s team was able to leverage AI and Intermountain’s data to not only replicate the model for ARDS but also identify additional risk factors to further improve the quality of care.
“That’s one of the very real powers of AI. It took what would have taken months or years and allowed it to happen in days,” says Mr Probst.
As Intermountain shows, digital transformation involves shifting advanced technology beyond the IT department’s walls, bringing IT and the business ever closer. Although sometimes challenging, the introduction of new tech offers meaningful change for patients, providers and staff.
Putting it all together
Though every organisation is at a different stage of their transformation, there are several practices CIOs can keep in mind along the way:
Stay aware of new technologies and potential use cases to meet new customer demands; Leverage partnerships for innovation to pool resources and take risks; and Be creative about translating IT solutions into business innovations.In the end, the opportunities offered by emerging technologies may be well worth their weight in gold.
To learn more about the Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] KPMG, “Press release, the Harvey Nash / KPMG CIO Survey 2017” May 23rd 2017, https://www.hnkpmgciosurvey.com/press-release/ [2] Gartner, “Gartner Survey shows organizations are slow to advance in data and analytics”, 2018 https://www.gartner.com/newsroom/id/3851963In this Q&A, The EIU asks Renata Marques, CIO of Whirlpool Latin America, about the changing role of the CIO, how emerging technologies like cloud are enabling innovation and how businesses execute their digital transformation journeys.
Renata Marques is the CIO at Whirlpool Latin America, responsible for information technology and digital business transformation solutions. Ms Marques has held previous IT leadership roles at ABB and Monsanto.
Today these changes require going beyond simply introducing new technologies to digitise the company. As a result, we asked leading CIOs globally from across industries to explore how they are pioneering successful digital transformations to accelerate innovation and strategic enablement across their businesses.
CIOs’ executive brief: three ways to update IT skills for digital transformation
Keep your own IT skills current. “Read, read, read as much as you can,” advises Theresa Payton, CEO of Fortalice Solutions and former White House CIO. “Then ask yourself, ‘what am I going to do—while I’m transforming the business—that allows me to transform myself in my role?’” Take a multi-tactic approach to building IT staff skills. Wondering whether to train, hire or outsource? All of the above, advise IT leaders. “The skills of those who report to the CIO are much more technical than they used to be,” says Marc Probst, CIO of Intermountain Healthcare. Engage with tomorrow’s IT experts today. Jaguar Land Rover, anticipating a shortage of skilled engineers, has engaged with more than 2m young people in the UK, encouraging them to consider STEM (science, technology, engineering and maths) education through its Inspiring Tomorrow’s Engineers initiative. Next, the company plans to engage with 2m more young people, this time worldwide, by 2020.
The pace at which new technologies—cloud, big data analytics, virtual reality (VR), artificial intelligence (AI), robotics and more—are developing is breathtaking. But if you really want to hear CIOs gasp for air, ask them about the new demands CIOs face as they seek to turn clever IT innovations into real-world business transformation.
CIOs must manage increasing IT complexity and the growing demands of business stakeholders. As Simon Bolton, CIO of UK-based Jaguar Land Rover also notes, modernising business strategies and aligning them with emerging technologies remain a CIO imperative: “My biggest aspiration is to help Jaguar Land Rover to be seen as a technology leader outside of the company within the automotive space.
“We’ve seen the industry changes: electrification, connected cars, autonomous driving, etc. We need to transform our business so that we’re ready to maximise those opportunities. In today’s world, where customers’ expectations are changing very quickly, we need to have systems that can respond to those changing requirements.”
CIOs face the dual challenge of maintaining business critical systems while adapting the business to leverage new technologies. Renata Marques, Latin America CIO of Whirlpool, advises CIOs to “have a very solid and stable foundation that doesn't consume the agenda of innovation and digital transformation.”
And yet many CIOs and their staff are not necessarily prepared for all of this change and the major implications for the workforce and skills. In a recent survey conducted by McKinsey, more than 60% of business executives said that due to advancing automation and digitisation, they’ll need to retrain or replace more than a quarter of their workforce between now and 2023 [1].
To make many of these changes successfully, integration of business and IT knowledge will be essential. Ritesh Sarda, CIO of Sun Life Financial Hong Kong says:
“Technologies without the business acumen or those that fail to solve the relevant business problem are absolutely useless. I think CIOs have to become more business savvy and have to be integrated and engrained into the business so that we know how we can use technology to resolve business challenges and make things forward-looking from an industry perspective."
New demands = New opportunities
Although balancing traditional business needs with the desire for innovation is always a challenge, the same changes that have reshaped the role of the CIO have also created new opportunities for workforce transformation.
Indeed, one reason CIOs need new skills is the way IT has moved beyond the back office and into customer-facing products and services. Consider today’s new cars. Essentially rolling data centres, they’re equipped with computerised engine components, Wi-Fi networks, GPS navigation, backup cameras, lane-departure warning systems and more. Tomorrow promises even more onboard IT, including electric batteries, voice-activated controls and self-driving capabilities.
Alongside these new tools, customers’ growing IT savvy puts even more pressure on CIOs. At Jaguar Land Rover, designers work on a seven-year product life cycle. For traditional automotive designers and engineers, to create a highly complex vehicle, that may seem like the blink of an eye. But for today’s consumers, it’s more like an eternity.
One path forward may be the adoption and implementation of Agile practices. “We need to do all we can to remain agile,” Mr Bolton says. “That’s becoming ever more challenging as technology moves faster and faster. As a company, we need to wrap our heads around this and make sure we’re all going forward at that speed.”
Ms Marques of Whirlpool brought in an Agile coach into the IT function to train her team once a week: “We started to transform our projects by adopting Agile methodology and delivering technology to the business in a different way. This is something that we’ve worked on a lot, not to just to speed up our process, but to create this future of innovation.”
Mr Bolton of Jaguar agrees that these changes bring new opportunities for workforce organisation. Historically, Jaguar Land Rover’s strengths have been engineering, manufacturing and design. Today, the company seeks to add to those strengths by placing greater emphasis on technology.
“Increasingly, we’re going to have to demonstrate real leadership around technology,” Mr Bolton says. “That requires a shift in skills, not just in the technology function, but across the company.”
That said, non-IT employees aren’t as far behind as they used to be, and like many consumers, both IT and non-IT staff have gained technological sophistication too. “One of the changes we’re going through,” notes Mr Bolton, “is we’re insourcing—not for every skill—but we’re bringing back in certain areas of technology that we’ve outsourced over the past few years”.
Marc Probst, CIO of Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, has had a front-row view of the dramatic changes in overall familiarity with technology. Technical positions at Intermountain that formerly reported into IT and Mr Probst have shifted to its clinical and financial business units.
For Mr Probst, that means assuming a new role. “I’ve become more of a co-ordinator,” he says, “and a technical resource to make sure the things they’re doing fall within our security parameters and don’t blow up the system. It’s really different.”
Ms Marques of Whirlpool similarly describes the importance of being a technical resource for the business and understanding its strategic needs: “Our role as CIO is to be the conduit—to convert all the technical knowledge into a single strategy and not have a lot of different technologies everywhere not in conversation with our business.”
The value of reskilling and mentorship
Though IT employees still generally have a better understanding of technology than other employees, given the fast-changing nature of technology, many CIOs find that their current IT staff members still struggle to keep up with consumer or colleague expectations. It’s a rare IT department that employs experts in big data analytics, AI and VR. Yet these skills are increasingly in demand. Some even say the IT industry faces a talent shortage.
Two ways forward may be hiring for greater diversity and improving mentoring and internal training. In theory, that should not be difficult. One person advocating for those changes is Theresa Payton.
“Recruiters tell me, ‘there’s a war for talent, and we just can’t find qualified people.’ I reply, ‘Well, maybe it’s because you and the hiring managers are all looking for the same people. There are only so many unicorns to go around,’” says Ms Payton, CEO of cyber-security firm Fortalice Solutions. Ms Payton was also formerly the CIO at the White House under George W Bush’s presidency from 2006 to 2008—and the first woman to hold that position.
Instead, Ms Payton recommends that CIOs start by considering the personal qualities they’re looking for in new hires, what she calls “non-negotiables”. The rest, she maintains, can be gained with training.
Ms Payton practices what she preaches and has implemented a mentor-protégé programme at her cyber-security firm. She explains the rationale: “Take advantage of your own amazing people and have them be responsible for some of the retooling and retraining of your workforce. Make it part of their workday. Build it into your resource plans that you’re going to train, coach and mentor the next generation. Doing that creates that cross training, that esprit de corps.”
Ms Payton also works hard to keep her own skills and knowledge up-to-the-minute. While working in Washington, DC, she got into the habit of waking at 3:30 am to read and make other preparations before the day’s first briefing. “You have to constantly be a student of the job,” she says. “Stay close to the business, and stay close to the technologies.”
~~~~~~~~~~~
To learn more about The EIU's Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] McKinsey, “Retraining and reskilling workers in the age of automation” January 2018. https://www.mckinsey.com/global-themes/future-of-organizations-and-work/...
In theory, new technologies drive digital transformation, but CIOs often find it’s not that easy. In fact, adopting new technologies to drive business results requires the CIO’s strategic involvement from the very beginning, from choosing the technologies to ensuring they’re working effectively across the enterprise.
“The CIO must be totally cognizant of all emerging technologies and solutions coming onto the market,” says Ritesh Sarda, CIO of Sun Life Financial Hong Kong. “But at the same time, technologies that fail to solve a relevant business problem are absolutely useless.”
Indeed, a recent survey of CIOs conducted by executive recruiter Harvey Nash and professional-services firms KPMG found that enterprise digital strategies were described as “very effective” by fewer than one in five IT leaders [1]. In another survey, conducted by IT advisory firm Gartner, more than 90% of respondents said their organisations haven’t yet reached “transformational” levels of maturity with data analytics, even though those companies’ CIOs have identified that technology as their number one investment priority [2].
Innovating with the customer in mind
Some CIOs, however, are doing an excellent job of identifying and evaluating new technologies for digital transformation. Increasingly, their organisations are doing the same with customer-facing products and services and implementing new technologies across their companies’ operations.
That’s the case at Whirlpool. The world’s leading home-appliance provider, Whirlpool ships more than 70m products a year, many of them digitally enabled. Various Whirlpool appliances now interact with artificial intelligence (AI) tools for analytics, automatic ordering services and several virtual assistants for voice control. Renata Marques, CIO of Whirlpool Latin America, and her IT team recently helped to develop a “smart” beer cooler, not yet on the market, that replenishes consumers’ beer supplies by detecting when beer is running out, then automatically ordering more from a partner marketplace. Moreover, the company recently acquired a mobile app called Yummly; it uses image recognition to inventory the food in a consumer’s pantry, then recommends recipes using only those ingredients on hand.
Ms Marques has encouraged her teams to leverage new technologies for consumer-facing innovation. The Latin America division, based in São Paulo, Brazil, brings in roughly a quarter of Whirlpool’s global sales, which totalled US$21bn last year. “Because digital transformation is part of our strategic agenda,” Ms Marques says, “our IT organisation works closely with engineering, marketing and other business areas.”
And Ms Marques is also adopting Agile, a methodology borrowed from software development, to speed up her new IT projects. Her team recently evaluated a new web platform using an Agile concept known as MVP. Short for minimum viable product, it provides just enough features to garner user feedback. “Agile is something we’ve worked on a lot,” Ms Marques says, “to not just speed up our process, but also create our future of innovation.”
For Ms Marques, “creating a future of innovation” includes a cloud-first strategy that has been key to helping her IT group meet business needs. For example, using the cloud, Whirlpool Latin America recently implemented a new commerce platform for its KitchenAid home appliance brand to improve the consumer experience. The project, though massive, was completed in less than five months. “Without our cloud-first strategy,” Ms Marques says, “we could never have delivered such a big project so quickly.”
Partnering for innovation
Partnerships are another way for CIOs to implement emerging technologies for digital transformation. It’s an approach that works well for Sun Life Financial, a Toronto-based provider of insurance, wealth and asset-management solutions to individuals and corporate clients.
Due to Sun Life’s size—it has 33,000 employees, offices in over 25 countries and assets under management in excess of C$930bn (US$736bn)—moving quickly on new technologies can be a challenge. “As a large enterprise, sometimes we cannot innovate that far,” says Mr Sarda, who joined Sun Life in 2006 and became CIO of its Hong Kong unit in 2016. “So we partner with accelerators and incubation centres where we can pick fintechs and partner with them to evolve a business idea.”
These partnerships have led to some innovative results. One partnership has resulted in Sun Life’s adoption of software robotic automation, also known as “tech bots”, to process customer applications that previously involved lots of painstaking paperwork. The software robots now mimic the work previously done by humans, including underwriting, examining historical records and reviewing claims records. “Where there are inherent system deficiencies, we can create bots rather than putting humans in to do the dirty jobs,” Mr Sarda says.
Another project enhanced by partnership is Sun Life’s implementation of chatbots. These AI implementations populate a website to answer customers’ frequently asked questions. Partners are also now working with Sun Life on blockchain, a platform for decentralised applications, and facial-recognition systems for identity authentication. At any given time, Mr Sarda and his team are partnering with as many as ten specialist companies. “Then,” he adds, “we see which ideas eventually become mature.”
DIY tech
At Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, CIO Marc Probst and his team have taken a different approach to new technologies: they build what they need and then turn their solutions into new products and services for the company.
One internally developed IT innovation at Intermountain has even led to the formation of a separate company. Called Empiric Health, it offers software designed to help surgical teams control their costs by assessing how different procedures like supply utilisation or staffing affect health outcomes. “That was actually a piece of software we wrote for our internal operating rooms,” Mr Probst says. “We found it was saving us tens of millions of dollars a year, so our people said, ‘Hmm…this may be something of value to other organisations.’”
And using emerging technologies to drive business innovation can also help create better outcomes for patient health. For example, Intermountain clinicians developed a care process model to guide care provision for acute respiratory disease syndrome (ARDS), an illness that’s often fatal. While the model reduced mortality rates, Mr Probst’s team was able to leverage AI and Intermountain’s data to not only replicate the model for ARDS but also identify additional risk factors to further improve the quality of care.
“That’s one of the very real powers of AI. It took what would have taken months or years and allowed it to happen in days,” says Mr Probst.
As Intermountain shows, digital transformation involves shifting advanced technology beyond the IT department’s walls, bringing IT and the business ever closer. Although sometimes challenging, the introduction of new tech offers meaningful change for patients, providers and staff.
Putting it all together
Though every organisation is at a different stage of their transformation, there are several practices CIOs can keep in mind along the way:
Stay aware of new technologies and potential use cases to meet new customer demands; Leverage partnerships for innovation to pool resources and take risks; and Be creative about translating IT solutions into business innovations.In the end, the opportunities offered by emerging technologies may be well worth their weight in gold.
To learn more about the Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] KPMG, “Press release, the Harvey Nash / KPMG CIO Survey 2017” May 23rd 2017, https://www.hnkpmgciosurvey.com/press-release/ [2] Gartner, “Gartner Survey shows organizations are slow to advance in data and analytics”, 2018 https://www.gartner.com/newsroom/id/3851963In this Q&A, The EIU asks Ritesh Sarda, CIO of Sun Life Financial Hong Kong, about the changing role of the CIO, digital transformation in the financial services industry and how CIOs can leverage emerging technologies to enable their business strategies. Ritesh Sarda is the CIO of Sun Life Financial Hong Kong.
CIOs’ executive brief: three ways to update IT skills for digital transformation
Keep your own IT skills current. “Read, read, read as much as you can,” advises Theresa Payton, CEO of Fortalice Solutions and former White House CIO. “Then ask yourself, ‘what am I going to do—while I’m transforming the business—that allows me to transform myself in my role?’” Take a multi-tactic approach to building IT staff skills. Wondering whether to train, hire or outsource? All of the above, advise IT leaders. “The skills of those who report to the CIO are much more technical than they used to be,” says Marc Probst, CIO of Intermountain Healthcare. Engage with tomorrow’s IT experts today. Jaguar Land Rover, anticipating a shortage of skilled engineers, has engaged with more than 2m young people in the UK, encouraging them to consider STEM (science, technology, engineering and maths) education through its Inspiring Tomorrow’s Engineers initiative. Next, the company plans to engage with 2m more young people, this time worldwide, by 2020.
The pace at which new technologies—cloud, big data analytics, virtual reality (VR), artificial intelligence (AI), robotics and more—are developing is breathtaking. But if you really want to hear CIOs gasp for air, ask them about the new demands CIOs face as they seek to turn clever IT innovations into real-world business transformation.
CIOs must manage increasing IT complexity and the growing demands of business stakeholders. As Simon Bolton, CIO of UK-based Jaguar Land Rover also notes, modernising business strategies and aligning them with emerging technologies remain a CIO imperative: “My biggest aspiration is to help Jaguar Land Rover to be seen as a technology leader outside of the company within the automotive space.
“We’ve seen the industry changes: electrification, connected cars, autonomous driving, etc. We need to transform our business so that we’re ready to maximise those opportunities. In today’s world, where customers’ expectations are changing very quickly, we need to have systems that can respond to those changing requirements.”
CIOs face the dual challenge of maintaining business critical systems while adapting the business to leverage new technologies. Renata Marques, Latin America CIO of Whirlpool, advises CIOs to “have a very solid and stable foundation that doesn't consume the agenda of innovation and digital transformation.”
And yet many CIOs and their staff are not necessarily prepared for all of this change and the major implications for the workforce and skills. In a recent survey conducted by McKinsey, more than 60% of business executives said that due to advancing automation and digitisation, they’ll need to retrain or replace more than a quarter of their workforce between now and 2023 [1].
To make many of these changes successfully, integration of business and IT knowledge will be essential. Ritesh Sarda, CIO of Sun Life Financial Hong Kong says:
“Technologies without the business acumen or those that fail to solve the relevant business problem are absolutely useless. I think CIOs have to become more business savvy and have to be integrated and engrained into the business so that we know how we can use technology to resolve business challenges and make things forward-looking from an industry perspective."
New demands = New opportunities
Although balancing traditional business needs with the desire for innovation is always a challenge, the same changes that have reshaped the role of the CIO have also created new opportunities for workforce transformation.
Indeed, one reason CIOs need new skills is the way IT has moved beyond the back office and into customer-facing products and services. Consider today’s new cars. Essentially rolling data centres, they’re equipped with computerised engine components, Wi-Fi networks, GPS navigation, backup cameras, lane-departure warning systems and more. Tomorrow promises even more onboard IT, including electric batteries, voice-activated controls and self-driving capabilities.
Alongside these new tools, customers’ growing IT savvy puts even more pressure on CIOs. At Jaguar Land Rover, designers work on a seven-year product life cycle. For traditional automotive designers and engineers, to create a highly complex vehicle, that may seem like the blink of an eye. But for today’s consumers, it’s more like an eternity.
One path forward may be the adoption and implementation of Agile practices. “We need to do all we can to remain agile,” Mr Bolton says. “That’s becoming ever more challenging as technology moves faster and faster. As a company, we need to wrap our heads around this and make sure we’re all going forward at that speed.”
Ms Marques of Whirlpool brought in an Agile coach into the IT function to train her team once a week: “We started to transform our projects by adopting Agile methodology and delivering technology to the business in a different way. This is something that we’ve worked on a lot, not to just to speed up our process, but to create this future of innovation.”
Mr Bolton of Jaguar agrees that these changes bring new opportunities for workforce organisation. Historically, Jaguar Land Rover’s strengths have been engineering, manufacturing and design. Today, the company seeks to add to those strengths by placing greater emphasis on technology.
“Increasingly, we’re going to have to demonstrate real leadership around technology,” Mr Bolton says. “That requires a shift in skills, not just in the technology function, but across the company.”
That said, non-IT employees aren’t as far behind as they used to be, and like many consumers, both IT and non-IT staff have gained technological sophistication too. “One of the changes we’re going through,” notes Mr Bolton, “is we’re insourcing—not for every skill—but we’re bringing back in certain areas of technology that we’ve outsourced over the past few years”.
Marc Probst, CIO of Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, has had a front-row view of the dramatic changes in overall familiarity with technology. Technical positions at Intermountain that formerly reported into IT and Mr Probst have shifted to its clinical and financial business units.
For Mr Probst, that means assuming a new role. “I’ve become more of a co-ordinator,” he says, “and a technical resource to make sure the things they’re doing fall within our security parameters and don’t blow up the system. It’s really different.”
Ms Marques of Whirlpool similarly describes the importance of being a technical resource for the business and understanding its strategic needs: “Our role as CIO is to be the conduit—to convert all the technical knowledge into a single strategy and not have a lot of different technologies everywhere not in conversation with our business.”
The value of reskilling and mentorship
Though IT employees still generally have a better understanding of technology than other employees, given the fast-changing nature of technology, many CIOs find that their current IT staff members still struggle to keep up with consumer or colleague expectations. It’s a rare IT department that employs experts in big data analytics, AI and VR. Yet these skills are increasingly in demand. Some even say the IT industry faces a talent shortage.
Two ways forward may be hiring for greater diversity and improving mentoring and internal training. In theory, that should not be difficult. One person advocating for those changes is Theresa Payton.
“Recruiters tell me, ‘there’s a war for talent, and we just can’t find qualified people.’ I reply, ‘Well, maybe it’s because you and the hiring managers are all looking for the same people. There are only so many unicorns to go around,’” says Ms Payton, CEO of cyber-security firm Fortalice Solutions. Ms Payton was also formerly the CIO at the White House under George W Bush’s presidency from 2006 to 2008—and the first woman to hold that position.
Instead, Ms Payton recommends that CIOs start by considering the personal qualities they’re looking for in new hires, what she calls “non-negotiables”. The rest, she maintains, can be gained with training.
Ms Payton practices what she preaches and has implemented a mentor-protégé programme at her cyber-security firm. She explains the rationale: “Take advantage of your own amazing people and have them be responsible for some of the retooling and retraining of your workforce. Make it part of their workday. Build it into your resource plans that you’re going to train, coach and mentor the next generation. Doing that creates that cross training, that esprit de corps.”
Ms Payton also works hard to keep her own skills and knowledge up-to-the-minute. While working in Washington, DC, she got into the habit of waking at 3:30 am to read and make other preparations before the day’s first briefing. “You have to constantly be a student of the job,” she says. “Stay close to the business, and stay close to the technologies.”
~~~~~~~~~~~
To learn more about The EIU's Pioneering Leadership programme, find a full range of insights, including more Q&As, articles and an in-depth report, here.
[1] McKinsey, “Retraining and reskilling workers in the age of automation” January 2018. https://www.mckinsey.com/global-themes/future-of-organizations-and-work/...
Today these changes require going beyond simply introducing new technologies to digitise the company. As a result, we asked leading CIOs globally from across industries to explore how they are pioneering successful digital transformations to accelerate innovation and strategic enablement across their businesses.
In theory, new technologies drive digital transformation, but CIOs often find it’s not that easy. In fact, adopting new technologies to drive business results requires the CIO’s strategic involvement from the very beginning, from choosing the technologies to ensuring they’re working effectively across the enterprise.
“The CIO must be totally cognizant of all emerging technologies and solutions coming onto the market,” says Ritesh Sarda, CIO of Sun Life Financial Hong Kong. “But at the same time, technologies that fail to solve a relevant business problem are absolutely useless.”
Indeed, a recent survey of CIOs conducted by executive recruiter Harvey Nash and professional-services firms KPMG found that enterprise digital strategies were described as “very effective” by fewer than one in five IT leaders [1]. In another survey, conducted by IT advisory firm Gartner, more than 90% of respondents said their organisations haven’t yet reached “transformational” levels of maturity with data analytics, even though those companies’ CIOs have identified that technology as their number one investment priority [2].
Innovating with the customer in mind
Some CIOs, however, are doing an excellent job of identifying and evaluating new technologies for digital transformation. Increasingly, their organisations are doing the same with customer-facing products and services and implementing new technologies across their companies’ operations.
That’s the case at Whirlpool. The world’s leading home-appliance provider, Whirlpool ships more than 70m products a year, many of them digitally enabled. Various Whirlpool appliances now interact with artificial intelligence (AI) tools for analytics, automatic ordering services and several virtual assistants for voice control. Renata Marques, CIO of Whirlpool Latin America, and her IT team recently helped to develop a “smart” beer cooler, not yet on the market, that replenishes consumers’ beer supplies by detecting when beer is running out, then automatically ordering more from a partner marketplace. Moreover, the company recently acquired a mobile app called Yummly; it uses image recognition to inventory the food in a consumer’s pantry, then recommends recipes using only those ingredients on hand.
Ms Marques has encouraged her teams to leverage new technologies for consumer-facing innovation. The Latin America division, based in São Paulo, Brazil, brings in roughly a quarter of Whirlpool’s global sales, which totalled US$21bn last year. “Because digital transformation is part of our strategic agenda,” Ms Marques says, “our IT organisation works closely with engineering, marketing and other business areas.”
And Ms Marques is also adopting Agile, a methodology borrowed from software development, to speed up her new IT projects. Her team recently evaluated a new web platform using an Agile concept known as MVP. Short for minimum viable product, it provides just enough features to garner user feedback. “Agile is something we’ve worked on a lot,” Ms Marques says, “to not just speed up our process, but also create our future of innovation.”
For Ms Marques, “creating a future of innovation” includes a cloud-first strategy that has been key to helping her IT group meet business needs. For example, using the cloud, Whirlpool Latin America recently implemented a new commerce platform for its KitchenAid home appliance brand to improve the consumer experience. The project, though massive, was completed in less than five months. “Without our cloud-first strategy,” Ms Marques says, “we could never have delivered such a big project so quickly.”
Partnering for innovation
Partnerships are another way for CIOs to implement emerging technologies for digital transformation. It’s an approach that works well for Sun Life Financial, a Toronto-based provider of insurance, wealth and asset-management solutions to individuals and corporate clients.
Due to Sun Life’s size—it has 33,000 employees, offices in over 25 countries and assets under management in excess of C$930bn (US$736bn)—moving quickly on new technologies can be a challenge. “As a large enterprise, sometimes we cannot innovate that far,” says Mr Sarda, who joined Sun Life in 2006 and became CIO of its Hong Kong unit in 2016. “So we partner with accelerators and incubation centres where we can pick fintechs and partner with them to evolve a business idea.”
These partnerships have led to some innovative results. One partnership has resulted in Sun Life’s adoption of software robotic automation, also known as “tech bots”, to process customer applications that previously involved lots of painstaking paperwork. The software robots now mimic the work previously done by humans, including underwriting, examining historical records and reviewing claims records. “Where there are inherent system deficiencies, we can create bots rather than putting humans in to do the dirty jobs,” Mr Sarda says.
Another project enhanced by partnership is Sun Life’s implementation of chatbots. These AI implementations populate a website to answer customers’ frequently asked questions. Partners are also now working with Sun Life on blockchain, a platform for decentralised applications, and facial-recognition systems for identity authentication. At any given time, Mr Sarda and his team are partnering with as many as ten specialist companies. “Then,” he adds, “we see which ideas eventually become mature.”
DIY tech
At Intermountain Healthcare, a not-for-profit health system based in Salt Lake City, Utah, CIO Marc Probst and his team have taken a different approach to new technologies: they build what they need and then turn their solutions into new products and services for the company.
One internally developed IT innovation at Intermountain has even led to the formation of a separate company. Called Empiric Health, it offers software designed to help surgical teams control their costs by assessing how different procedures like supply utilisation or staffing affect health outcomes. “That was actually a piece of software we wrote for our internal operating rooms,” Mr Probst says. “We found it was saving us tens of millions of dollars a year, so our people said, ‘Hmm…this may be something of value to other organisations.’”
And using emerging technologies to drive business innovation can also help create better outcomes for patient health. For example, Intermountain clinicians developed a care process model to guide care provision for acute respiratory disease syndrome (ARDS), an illness that’s often fatal. While the model reduced mortality rates, Mr Probst’s team was able to leverage AI and Intermountain’s data to not only replicate the model for ARDS but also identify additional risk factors to further improve the quality of care.
“That’s one of the very real powers of AI. It took what would have taken months or years and allowed it to happen in days,” says Mr Probst.
As Intermountain shows, digital transformation involves shifting advanced technology beyond the IT department’s walls, bringing IT and the business ever closer. Although sometimes challenging, the introduction of new tech offers meaningful change for patients, providers and staff.
Putting it all together
Though every organisation is at a different stage of their transformation, there are several practices CIOs can keep in mind along the way:
Stay aware of new technologies and potential use cases to meet new customer demands; Leverage partnerships for innovation to pool resources and take risks; and Be creative about translating IT solutions into business innovations.In the end, the opportunities offered by emerging technologies may be well worth their weight in gold.
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[1] KPMG, “Press release, the Harvey Nash / KPMG CIO Survey 2017” May 23rd 2017, https://www.hnkpmgciosurvey.com/press-release/ [2] Gartner, “Gartner Survey shows organizations are slow to advance in data and analytics”, 2018 https://www.gartner.com/newsroom/id/3851963