Taming the Digital Dragon The 2014 CIO Agenda Steve High Ed Barrows steve.high@gartner.com ed.barrows@gartner.com @StephenKHigh 817-203-2410 210-317-7123 © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. This publication may not be reproduced or distributed in any form without Gartner's prior written permission. If you are authorized to access this publication, your use of it is subject to the Usage Guidelines for Gartner Services posted on gartner.com. The information contained in this publication has been obtained from sources believed to be reliable. Gartner di sclaims all warranties as to the accuracy, completeness or adequacy of such information and shall have no liability for errors, omissions or inadequacies in such information. This publication consists of the opinions of Gartner's research organization and should not be construed as statements of fact. The opinions expressed herein are subject to change without notice. Although Gartner research may include a discussion of related legal issues, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner is a public company, and its shareholders may include firms and funds that have financial interests in entities covered in Gartner research. Gartner's Board of Directors may include senior managers of these firms or funds. Gartner research is produced independently by its research organization without input or influence from these firms, funds or their managers. For further information on the independence and integrity of Gartner research, see "Guiding Principles on Independence and Objectivity." Leading in a Digital World … So What's Changed? #GartnerSYM © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Leading in a Digital World • Digital growth. It's no longer enough for IT to improve operational efficiency; instead, technology is now expected to fuel a new wave of business growth and mission effectiveness. • Innovation and leadership. CIOs must develop multilevel and multilateral teams to engage with the business, systemically driving innovation in the front-office. • Operational and organizational excellence. Now more than ever before, CIOs need a strong foundation in back-office IT. What's needed is the kind of operational and organizational excellence that supports long-term enterprise innovation and growth. LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE Digital Industrial Economy Where ignorance is the enemy and economic uncertainty is an opportunity… not an excuse. LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE We Are Entering a 3rd Era of Enterprise IT We are here IT Craftsmanship IT Industrialization Digitalization Technology Processes Business Models Capabilities Programming, system management IT management, service management Digital leadership Engagement Isolated, disengaged internally and externally Treat colleagues as customers, unengaged with external customers Treat colleagues as partners, engage external customers Sporadic automation and innovation, frequent issues Services & solutions, efficiency & effectiveness Digital business innovation, new types of value Focus Outputs & Outcomes © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. 6 Time Travel… to the Year 2020 • 2020 - Cloud, Social, Information and Mobile - Information is the oil of the 21st century; • Analytics is the combustion engine. - 4.4 million IT jobs will be created globally to support big data - Cloud should be your first approach to computing - Design your business around mobile - Incorporate Social software throughout enterprise - Every budget is an IT budget LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE Time Travel… to the Year 2020 • 2020 - Architectures of the last 20 years: obsolete - ½ of all non-PC devices used in business will be purchased by employees - Cloud security will triple - CMO will have a bigger IT budget than IT - Every business leader is a digital leader - Every person is becoming an IT company LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE airBnB © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. We Need a Three-Part Response to Tame the Digital Dragon Digitalization IT Industrialization • Clear digital roles • Savvy digital executives • Digital vision & digital legacy Create powerful digital leadership. • • • • Renovate the core of IT. • • • • Agile development Multidisciplinary teams Innovative partnerships New risk/speed trade-offs Build bimodal capability. Cloud/Web-scale infrastructure Information Talent Sourcing © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. 7 Break out Group # 1 • How would you characterize the digital savvy of your CEO / Board / Executive Team? • Have there been discussions at the Executive level about the nature of digital opportunities and challenges, and the overall digital leadership? • What steps can the IT Leadership team take to educate other executives about these digital opportunities and challenges? © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. 13 The Chief Digital Officer Role Is on the Rise "If the CEO asks 'Who is in charge of digital?' and gets multiple responses, then there is no digital leadership." Baron Concors, CIO of Yum Restaurants International, former CIO and CDO of Pizza Hut Industry %CDOs 21% Media 13% Communications 11% Services 10% Banking 9% Insurance 9% Retail 5% Healthcare Providers 5% Government 5% Manufacturing & Natural Resources 3% Wholesale Trade 3% Education 4% Transportation 1% Utilities No. Am.: 5% EMEA: Lat. Am.: Asia/Pac: 6% 7% 11% Gartner predicts a tripling of the CDO role by 2015. "For the CIO, there is a strong opportunity, and also a responsibility, to be part of this new digital game. However the organizational model plays out, there will be a strong push for the digital future." Gianni Leone, CIO and CDO, Miroglio Group Mythbuster: The CDO role is not limited to media or information-intensive industries. © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. 9 The Scope of the CDO's Role Is Broadening, Too CDO's Team CDO 9% 23% 15% 27% 26% CDO is sole advisor Small team of analysts Resources to pilot Substantial devt. Develop and run CDO's Background Bus. strategy 15% IT 19% Marketing 20% Combination 36% Other 7% Don't know 3% CDO's Reporting Line CEO CMO CIO Other 42% 22% 16% CDO CDO-CIO Integration Neutral/ Unclear CDO 20% Clear 65% 35% "I have to play Dr. Jekyll and Mr. Hyde as I move between the two roles, making sure I apply the correct set of rules depending on the hat I'm wearing — traditional IT versus leading digital transformation." Gianni Leone, CIO and CDO, Miroglio Group Mythbuster: The CDO is not, in general, a lone advisor. Most CDOs have a team. © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. 10 Build Enterprise Digital Savvy From the C-Suite Down "[Our©leadership] have set it as a goal and objective for everyone in the company to become digitally enabled." 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Bill Ruh, vice president of Global Software Center, GE 13 Digital Industrial Economy • Business Processes • Business Model Changes • Business Moments LEADING IN A DIGITAL WORLD © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. DIGITAL GROWTH INNOVATION ORGANIZATIONAL EXCELLENCE Is Your Organization Selling Experiences, or Is It Still Thinking in Terms of Products? The Experience Economy Commodity 1¢ to 2¢ a cup © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Goods 5¢ to 25¢ a cup Experience $2 to $5 a cup 1.Smart Phone detects sudden deceleration. 6. Estimates for repairs sent to smart phone from different companies. Negotiations ensue to get best price and delivery. 8. Smart phone notifies next of kin via text messages and Facebook. 2. Smart phone interrogates passenger clothing for vital signs. 7. Meanwhile, smartphone interrogates nearby video cameras to collect digital evidence of the car crash as it occurred. 9. Smart phone sends information portfolio to law firms for assessment. 3. Smart phone sends information to medical emergency first responders and opens up communications lines for survivors.. 4. Smart phone interrogates vehicle systems for damage report. 5. Damage report sent to fire, police, towing, and insurance companies. © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Mobile, Social, Cloud… in a matter of weeks The Experience Economy © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Break out Group # 2 • Many IT organizations do some form of Bimodal IT today. How have you been successful with a fast mode, and how can you build on that to become more agile and more innovative? • How have you created more time and space to Grow / Transform projects while minimizing effort spent on Run projects? • Are there projects or initiatives that today seem--stuck? Would they benefit from a different way of thinking about teamwork, culture, risk and delivery? © 2013 Gartner, Inc. and/or its affiliates. All rights reserved. 21