What are the focus areas for CIOs to better align IT with business goals

Although most companies are aware of the opportunity that cloud offers, many are struggling to capture the full value

With technology becoming the driving force for large incumbent businesses, as it has been for startups, the role of chief information officers (CIOs) is evolving significantly. The CIOs need to make the leap from tech leader to business driver, according to a blogpost by Aamer Baig, senior partner, McKinsey & Company Chicago. The actions they take in the next 12 months will largely determine whether their business can meet its aspirations, Baig added. He has identified six key areas that can help CIOs better align IT with business goals.

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It is important for CIOs to know their customers, along with the technology, the report added. While the product and sales team meet with customers at many companies, IT gets the requirements for products and services that are a by-product of those interactions. “Without a deeper commitment to understanding the customer, IT and the CIO will continue to be the executors of strategy rather than its shapers,” Baig highlighted.

Without a proper understanding of the customers, it would be difficult to comprehend what customers value and what technology’s role should be in delivering that value. However, developers work closely with both product managers and customers in tech companies. As per the report, the developer teams are as effective at spotting needs as product teams are.

“Building this level of integration starts with CEOs making sure that the tech leaders are part of the inner circle and embedding developers into product and sales teams to co-create the things that customers want,” he added.

Although most companies are aware of the opportunity that cloud offers, many are struggling to capture the full value. In addition, companies are not looking at the cloud as a transformative value but as a source of IT productivity improvements. They can achieve significant cost savings through cloud migration programmes. “CIOs have a crucial role in getting the business to focus on the far bigger prize: the new businesses, innovative practices, and new sources of revenue that cloud either enables or accelerates,” Baig noted.

While 50% of CIOs plan to migrate more than three-quarters of all workloads to the cloud in the next two years, less than 10% of technology leaders are most focused on hiring cloud talents. CIOs need to consider how to change IT’s operating model at a large scale to generate new value and master cloud economics as well.

Creating a good work culture for developers is another key concern that CIOs need to prioritise. For example, promoting an environment of “psychological safety”, providing them with world-class planning and development tools can enable developers.

“Companies also need to use their best developers for the most important work. Just as the military wouldn’t have a top fighter pilot doing basic mechanical work, businesses should give their top developers the highest-priority and most-exciting projects,” Baig said. Moreover, CIOs need to give developers the freedom to work, he added further.

In today’s fast-changing environment, CIOs have to be the fastest learners and develop an expansive view of learning that goes beyond training modules and certification programs, according to Baig. They also need to make tech literacy a priority across the business to develop an understanding of tech use among non-tech people.

As cybersecurity threats are increasing gradually, the importance of security functions should also rise. CIOs can provide developers with the education and incentives to build security and compliance into their code. They should also apply a developer mindset to security rather than a compliance one to upgrade security operations.

Given the critical importance of data in any modern business, the focus should be more on quality rather than quantity. Many companies are giving more attention to manage the scale of data, rather than extract the value. “CIOs can drive effective data governance through a balance of centralized data-management and governance role,” Baig stated.

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