New rules, realities and opportunities for IT leaders

As business leaders look for IT to drive business results, now is the opportunity for CIOs and IT leaders to recognize the new realities, apply the new rules and drive the organization forward to embrace new opportunities, according to Gartner, Inc.

During the opening keynote at Gartner Symposium/ITxpo, last week, Gartner analysts told an audience of more than 7,000 IT leaders that businesses have different expectations for their CIO.

 “This new type of CIO won’t ask first what the implementation cost is, or whether something complies with the architecture, but whether it’s good for the enterprise,” said Hung LeHong, research vice president at Gartner. “They will train their teams to think like a business executive, asking first ‘is this valuable?’, and only then asking ‘how can we make this work?’ There will be people experimenting with new ideas, working with product development, marketing, public relations and the C-suite to come up with ways of delivering more value directly to the external customer.”

New Realities

Gartner analysts said the IT industry is at the start of a new era. For IT, the time to act is now, and how IT leaders act will be shaped by three realities of the new era:

nThe power of unprecedented choice

nWild Open World

nA shift from outputs to outcomes

Gartner used the example of a social worker who identified a child in his caseload who may have had trouble brewing at home. The social worker had “friended” the child on his personal Facebook, and he found there was a lot to learn by observing the child’s social network behavior. The case worker spotted changes in the child’s Facebook activity, and took this change as an early sign that something may be wrong. That prompted him to make an impromptu home visit, when the caseworker’s suspicions were confirmed.

“Social network analysis – whether done manually by individual case workers, or on a more formalized basis using advanced analysis tools or services, can make a big difference,” said Andrea Di Maio, vice president and distinguished analyst at Gartner. “Who would have thought that government officials would rely on external, unsecured data to achieve their mission? This is beyond consumerization, beyond people using their own devices at work. It is about how employees find new ways to get the job done, blurring their personal and professional lives in the process.”

This scenario showed three new realities: 1) the power of unprecedented choice: the caseworker chose to use his Facebook account because he wanted to be where the child was. 2) A Wild Open World:  The caseworker used external information from the Facebook pages rather than just on his agency’s information. 3) A shift to outcome orientation from output: The caseworker did not use technology to simply follow the established process, instead he used technology to achieve the right outcome, in this case the child’s safety.

 “Together, these realities reflect a new era,” Mr. Di Maio said. “It’s a change in how people choose to live, play and work, but also in how organizations operate.”

1) Power of Unprecedented Choice

CIOs might not recognize choice in action, when what they feel is loss of control – IT losing control of the infrastructure, control of applications, and control of devices. IT leaders should rethink whether it’s really a loss of control, or whether it is choice in action.

“Business leaders now have the power of choice, and they will use it,” said Mark McDonald, group vice president for Executive Programs at Gartner. “Choice is not just about cutting cost. Choice is about time to market. Choice is about capability, capacity, quality of service, and agility.”

2) The Wild Open World

The power of choice exercised by people every day, every where, leads to the second stark reality of this new era: the Wild Open World. People leave a trail of what they’ve done online, leaving a rich body of information about their interests, intentions and activities. The data, much of it unstructured, contains nuggets of wisdom buried in various formats such as videos, podcasts, and blogs.

 “People access unprecedented amounts of information from outside the enterprise and establish personal connections with customers and suppliers,” said Mr. Di Maio said. “The boundaries between roles and responsibilities, between internal and external information, between personal and professional, between clients, partners, competitors, and suppliers, are blurring to the point that you cannot see them any longer.”

3) A Shift from Output to Outcome

The reality of unprecedented choice and the reality of the Wild Open World are forcing the third new business reality, a shift in business concern from outputs to outcomes. For IT, outputs are measured in terms of projects completed, budget run-rate, servers deployed, network uptime, etc...

Outputs are proxies for cost and risk. Gartner anasts said cost is important, but it is only one direction of a CIO’s compass. In contrast, by focusing on outcomes, CIOs will also address value and innovation.

 “Outcomes are about the results, the things that are tangibly different in your organization. Outcomes are about delightful customer experiences. Outcomes are in your operations, and how you engage your employees. Outcomes that drive top and bottom line growth, and create future potential for you and your enterprise,” Mr. McDonald said. “In this new era, business leaders choose to invest in outcomes rather than funding outputs. The value rests in the outcomes. Addressing this reality will resolve one of IT’s most persistent and pernicious issues – measuring the business impact of IT.”

New Rules

Gartner sees three new rules that will be constants into the new era. CIOs are urged to apply these rules to lead their business (not just the IT organization) forward. These new rules include:

nSmart Control

nIntelligent Business

nIT Dynamism

A) Smart Control

An old rule for the old era was absolute, centralized IT control over technology, people, infrastructure, and services. Users now have access to unprecedented IT choices. They can access them how they want, where they want, on whatever device they want.

 “CIOs and IT leaders must transform themselves from controllers to influencers; from implementers to advisers; from employees to partners,” said Eric Knipp, principal research analyst at Gartner. “You own this metamorphosis – as an IT leader, you must implement smart control. Open the IT environment to a Wild Open World of unprecedented choice, and better balance cost, risk, innovation, and value.”

Users can achieve incredible things without the IT department, but they can only maximize their IT capabilities with the IT department. Smart control is about managing technology in tighter alignment with business goals by loosening the grip on IT.

B) Intelligent Business

In the new era, IT leaders are in a position to shape how intelligence will be gathered, shared, consumed, and used by everyone in their organization, as well as how that information will be turned into intelligence.

To support an intelligent business, people in the organization will need to have access to the full spectrum of information that supports questions such as: What happened? Why did it happen? What is happening? And what is likely to happen? If IT leaders do not help, they will be locked out because employees will find the information from whatever source they can: transactions, video, mobile activity, tweets, search activity, blogs, text messaging, and social sites.

 “In an intelligent business, people contribute and share, and there is zero tolerance for people who hoard information,” said Yvonne Genovese, vice president and distinguished analyst at Gartner. “To play by this new rule, you need employees to find and share intelligence by combining information and collaboration. To support this culture change, it will require you to create a collaboration platform that includes technologies such as presence, instant messaging, web conferencing, social network analysis, and collaborative decision making to enable people to discover the right colleagues and experts to share insights and drive desired outcomes.”

C) IT Dynamism

Under the old rule, IT was tasked to develop solutions that delivered a specific business function and often had a “one size fits all” mentality. IT made deep, single-vendor commitments and pushed a core application to the far edges of the enterprise. The residual effects of this approach are being felt now – rigid systems where change is time-consuming and costly.

 “In the new era, we routinely need to start projects without knowing all of the requirements,” Mr. Knipp said. “We know that if we wait we’ll be too late to market. We also know that the dynamic nature of intense global competition forces us to redo previously well understood requirements at the drop of a hat. IT dynamism is the new rule because it means ‘build to change’.”

New Opportunities

The first new opportunity for IT leaders will be in bringing together new technologies to support the business in new ways. The second opportunity for IT leaders and their teams is to take the lead on these new opportunities instead of being a bystander.

Gartner analysts said there is no consensus on who gets to lead these initiatives just yet. It has not been determined whether the CIO, marketing, product development, or some yet-to-be-created roles will lead the way.

 “You’ve got a decade of infrastructure that will be the foundation for these opportunities,” said Nick Jones, vice president and distinguished analyst at Gartner.

 “New CIOs and their teams will be entrepreneurial,” said Nick Jones, vice president and distinguished analyst at Gartner. “This team will make decisions to increase innovation and value, taking risks and placing bets. They will be comfortable with ambiguity and risk, having incomplete requirements and still making the decision to act because they would rely on their knowledge and judgment.”