My last article for The CIO Leader, Technology is not a differentiator, argued that it was the solutions you build with the technology you have at your disposal, and not the technology itself, that will create differentiation. In other words, market leading technology is not the same as market leading solutions.
Establishing competitive advantage takes a lot more than just buying the best or latest systems, tools, infrastructure, etc. That may all be necessary to build the solutions required to create enhanced and new products/services or to enable new capabilities, but specifying the technology is the end of the process and not the beginning. That’s not to say CIOs should only be involved at the end of the process of establishing differentiators. In fact they can play a key role in the process of establishing them, and can even lead or prompt the discussion when formulating the organisation’s technology strategy.
Here are two ways CIOs can work with their C-suite colleagues, managers and staff from across the organisation to identify solutions that will create competitive advantage whilst also developing the strategic direction for IT:
- Improving the existing business model: can existing processes be made more efficient, cheaper or quicker? Run sessions with small groups comprising a cross-section of staff to look at how key business processes could be improved. Try using creative thinking techniques such as provocation or exaggeration to prompt new thinking. For example, when I was CIO in the support services industry where providers are often given no more than 3 months’ notice by clients to mobilise new multi-million pound contracts, I used the challenge “what if we only had one day to mobilise a new contract?” Now of course setting-up a large outsourcing contract in a day is (currently) impossible but it prompted some great discussion and some very creative ideas that made the contract mobilisation process a lot more efficient and controlled and also helped shape some key themes for our IT strategy, which over time enabled us to use our systems and speed of deployment as a differentiator.
- Addressing customer needs, problems or priorities: do your customers have any needs, problems or priorities that your organisation’s products/services can meet/address? This question can be tackled on a one-to-one or group basis. The time-period over which this should be considered depends on the market(s) in which the organisation operates and the nature of the products/services it provides. So going back to the outsourcing industry where contracts run for 3+ years we considered clients’ needs and priorities over 3-5 years. In consumer markets the timescale is likely to be much shorter. Once you have identified those needs, problems and/or priorities you can work out how your organisation can differentiate itself on them and hence whether there are any technology-enabled solutions required to establish the differentiators. In the outsourcing industry we identified public-spending cutbacks as a problem for local authority clients and therefore developed our platform so that we could offer it as an alternative to the clients’ own systems. This approach, which offered clients a better and more integrated solution as well as reduced costs, also provided us with a differentiator in the market.
One word of caution about these approaches: don’t expect ground-breaking ideas to come out of every session, these things sometimes take time and need the right combination of people and conditions. And it may be that some of the solutions identified in these sessions don’t require technology at all. But that’s okay as it will only serve to reinforce the CIO role as a broader business leader and not just a technical specialist.
But the reality is that, as technology is so fundamental to just about every organisation, differentiation and competitive advantage are almost always likely to be enabled either directly or indirectly by new or enhanced solutions. It makes perfect sense therefore that the person responsible for technology plays a key role in setting overall direction. However, my advice to CIOs is don’t wait to be invited, use the IT strategy as the opportunity to lead broader discussions about the future direction of your organisation. This will confirm the importance of technology and the CIO role within your organisation and demonstrate your own personal value.