Tag Archives: company vision

A CMO’s IT Dream Team

Dear CIO and my partner-in-creating-the-future:

I came across this great quote from Rita McGrath that makes me laugh but also wince because it’s such a painfully accurate observation, especially as I think about how many of these barriers we could overcome by transforming the way marketing and IT work together:

“All of our innovation barriers are self-inflicted.”

As the CIO, you lead a function that must demonstrate ever-greater value and impact. The pressure is on to shift away from being a utility provider to an enterprise strategic asset — an active creator of value and a collaborative contributor — a function driving, and driven by, innovation.

Guess what? Marketing feels a similar set of pressures, and I believe the keys to our success lie in how we work together. Not because there is strength in numbers, so much as because value creation in the new economy will happen at the intersection of three of the hats our functions influence, shape and lead within the organization: customer insight and analytics + user experience + implementation capability.

Years ago, I co-led a big initiative alongside one of my all-time favorite CIOs. We were assigned an audacious multi-year, IT-based effort. The CIO gave me a great piece of advice that has stuck with me through many assignments. “Amy,” she said, “you just have to chunk it.”

Chunking complex projects down into bite-size and digestible parts has become one of my personal core operating principles, and is relevant to the challenge of reinventing what we do for a digitally powered world. So herewith are six “chunks” I’d like you to embrace as elements of the answer.

  1. Connect the future path of the IT organization to the company’s vision. This sounds obvious. Nonetheless, taking the time to confirm that there is a vision, that it is clear and defensible and that it is understood by all constituencies may expose opportunities to get the IT foundation to be as air-tight as possible.

By the way, this advice applies equally to marketing. With all of the intense pressure to generate marketing return on investment (ROI), step one has to be a connection to business priorities.

  1. Empower IT team members with customer insight. An example of this would be to package and leverage ethnography, including artifacts coming out of in-home/on-site visits and day-in-the-life tag-alongs with customers – and by packaging I mean not the typical, mind-numbing Powerpoint slides, but video and other highly visual, interactive media that bring insights to life and make it easy to draw connections to development decisions.

I’d be happy to conduct workshops with members of the IT team to translate field learning into actions for business performance improvement and potentially disruptive business models.

  1. Insist upon and work actively to foster collaboration between IT and other functions … abolish the “order-taking” role. I’ve never met an IT professional who enjoyed being an order-taker, but it’s hard to redefine a role that for now-irrelevant reasons is often defined as such. Think like a start-up. How to change? Start by establishing processes grounded in business priorities and customer insight that foster collaboration between IT and other functions. Work with marketing to set the example. Demonstrate your role as a source of value.

One process I’ve seen work uses a repeatable approach to tapping into market insight and customer analytics to formulate hypotheses for growth, vetting and prioritizing them, putting the best ones into a test-and-learn cycle with working user prototypes, reading results and moving to next steps: kill, test again or roll out. This model demands design, analytics and technology skills, along with openness, a collaborative mindset and agility. With these conditions in place, it works.

  1. Implement an organization structure that enables digital transformation … and transcends the usual silos and politics. Challenge the norms and at least nudge your approach to accelerate IT’s impact on the digital transformation. There is always an “ideal scenario,” and then there’s the reality of anchoring to the company’s history, culture and business environment. These are all part of the context for a pragmatic organization solution that is both future-focused and rooted.

A good starting point is a fresh approach to a user experience capability. To be done right, this unit taps into a range of skills that would traditionally be distributed in marketing, IT, potentially finance or operations. Don’t overlook the impact on performance of co-location and a unified structure, what skills are really needed and how to close existing gaps. Consider the role of external resources who can jumpstart efforts, whether design agencies, big data analytics partners or maybe mobile app developers. IT should have a seat at the table to form this capability but may not be its organizational home.

  1. Take a clean-sheet approach to what is internal vs. external. Today the questions around what should be internal vs. outsourced, and how those outsourced relationships should be structured, have become more important and more complex. As with internal roles, external providers who know their stuff are more likely to walk the talk on a more multi-functional approach than traditional providers.

For both organization and external capabilities there is no right answer, except to be driven by the business vision and priorities, to be open-minded to new ways to execute and to expect external partners to collaborate, not just take orders.

  1. Enable a real prototyping capability … not just to see if code will run, but to get continuous and actionable customer feedback on the experience, either live in-market, or minimally in a simulation. This capability should enable speed, iteration and low cost.

On this recommendation, I have seen more examples in larger regulated institutions of what won’t work than what will. Live prototyping remains a challenge in regulated sectors, where there is no room for the downside of risks that might hurt a user, but where businesses are foregoing the upside of user-centered design.

Disruptors make the choice to frame business models that can advance without the permissions and burdens of a regulated entity. Creating infrastructure that assures compliance and predictability while also enabling agility is by itself an innovation opportunity.

Let’s work together on progress toward the Dream Team vision.

3 Keys to Achieving Sound Governance

Of the many definitions of governance, the simplest ones tend to have the most clarity. For the purpose of this piece, governance is a set of processes that enable an organization to operate in a fashion consistent with its goals and values and the reasonable expectations of those with vested interests in its success, such as customers, employees, shareholders and regulators. Governance is distinct from both compliance and enterprise risk management (ERM), but there are cultural and process-oriented similarities among these management practices.

It is well-recognized that sound governance measures can reduce the amount or impact of risk an organization faces. For that reason, among others, ERM practitioners favor a robust governance environment within an organization.

A few aspects of sound governance are worth discussion.  These include:  1) transparency and comprehensive communications, 2) rule of law and 3) consensus-building through thorough vetting of important decisions.

Transparency 

Transparency lessens the risk that either management or staff will try to do something unethical, unreasonably risky or wantonly self-serving because decisions, actions and information are very visible.  An unethical or covert act would stand out like the proverbial sore thumb.

Consider how some now-defunct companies, such as Enron, secretly performed what amounted to a charade of a productive business. There was no transparency about what assets of the company really were, how the company made money, what the real financial condition actually was and so on.

Companies that want to be transparent can:

  • Create a culture in which sharing of relevant data is encouraged.
  • Publish information about company vision, values, strategy, goals and results through internal communication vehicles.
  • Create clear instructions on a task by task basis that can used to train and be a reference for staff in all positions that is readily accessible and kept up to date.
  • Create clear escalation channels for issues or requests for exceptions.

Rule of Law

Good governance requires that all staff know that the organization stands for lawful and ethical conduct. One way to make this clear is to have “law abiding” or “ethical “as part of the organization’s values. Further, the organization needs to make sure these values are broadly and repeatedly communicated. Additionally, staff needs to be trained on what laws apply to the work they perform. Should a situation arise where there is a question as to what is legal, staff needs to know to whom they can bring the question.

The risks that develop out of deviating from lawful conduct include: financial, reputational and punitive. These are among the most significant non-strategic risks a company might face.

Consider a company that is found to have purposefully misled investors in its filings about something as basic as the cost of its raw materials. Such a company could face fines and loss of trust by investors, customers, rating agencies, regulators, etc., and individuals may even face jail time. In a transparent organization that has made it clear laws and regulations must be adhered to, the cost or cost trend of its raw materials would likely be a well documented and widely known number. Any report that contradicted common knowledge would be called into question.

Consider the dramatic uptick of companies being brought to task under the Foreign Corrupt Practices Act (FCPA) for everything from outright bribes to granting favors to highly placed individuals from other countries. In a transparent organization that has clearly articulated its position on staying within the law, any potentially illegal acts would likely be recognized and challenged.

How likely is it that a highly transparent culture wherein respect for laws and regulations is espoused would give rise to violations to prominent laws or regulations? It would be less likely, thus reducing financial, reputational and punitive risks.

The current increase in laws and regulations makes staying within the law more arduous, yet even more important. To limit the risk of falling outside the rule of law, organizations can:

  • Provide in-house training on laws affecting various aspects of the business.
  • Make information available to staff so that laws and regulations can be referenced, as needed.
  • Incorporate the legal way of doing things in procedures and processes.
  • Ensure that compliance audits are done on a regular basis.
  • Create hotlines for reporting unethical behavior.

Consensus-Building

Good governance requires consultation among a diverse group of stakeholders and experts. Through dialogue and, perhaps some compromise, a broad consensus of what is in the best interest of the organization can be reached. In other words, important decisions need to be vetted. This increases the chance that agreement can be developed and risks uncovered and addressed.

Decisions, even if clearly communicated and understood, are less likely to be carried out by those who have not had the chance to vet the idea.

Consider a CEO speaking to rating agency reviewers and answering a question about future earnings streams. Consider also that the CFO and other senior executives in separate meetings with the rating agency answer the same question in a very different way. In this scenario, there has clearly not been consensus on what the future looks like. A risk has been created that the company’s credit rating will be harmed.

To enhance consensus-building, companies can:

  • Create a culture where a free exchange of opinions is valued.
  • Encourage and reward teamwork.
  • Use meeting protocols that bring decision-making to a conclusion so that there is no doubt about the outcome (even when 100% consensus cannot be reached).
  • Document and disseminate decisions to all relevant parties.

During the ERM process step wherein risks are paired with mitigation plans, improved governance is often cited as the remedy to ameliorate the risk. No surprise there. Clearly, good governance reduces risk of many types. That is why ERM practitioners are fervent supporters of strong governance.