How CIOs can have their cake and eat it too

Jennifer Perry, Global Vice President and General Manager of SAP Services at Rimini Street, asks how CIOs can effectively take back control of their organization’s IT roadmap and nominates three areas IT leaders should start with.

The global pandemic created a wide variety of challenges across industries, and in IT, it caused bouts of ‘have your cake and eat it too’ syndrome.

On one hand, business leaders understandably became conservative with budgets, taking a cautious approach to spending during a period of economic uncertainty. On the other hand, these same leaders still wanted to see innovation continue to move forward, aspiring to obtain the ever-elusive yet much-coveted Digital Transformation.

To illustrate, a recent survey from IDG found that 80% of respondents say the pandemic accelerated demand for innovation. Yet at the same time, many faced this increased demand with shrinking budgets – more than half (52%) said the pandemic had resulted in reduced IT budgets to at least some extent.

This situation could have CIOs rolling their eyes. You can’t have it both ways – or can you?

It’s the big challenge facing CIOs right now. How do you continue to innovate in the face of the constraints presented by the pandemic? I have worked with many organizations, big and small, that had excellent IT roadmaps set up only for them to be smashed back to earth by the wrecking ball known as COVID-19.

The current situation has caused CIOs to evaluate and prioritize everything. For example, big bang ERP refresh or replacement projects are either put on hold or scrapped altogether as other initiatives with greater organizational impact are competing for the same resources (labor, time, budget). CIOs are asking which initiatives are most important at this crisis phase. If there is no clear and compelling ROI, the initiatives are either being deferred or canceled.

Part of the CIO’s job is to manage expectations from the business side of the house. I recently talked to a retailer that had ambitions to move to the cloud version of a major ERP software provider, but they had no real business case to make the move. The CIO needs to help their organization understand that this is not like restarting your phone to get the latest OS update – these types of migrations can take anywhere from two to five years and millions of dollars to complete. In other words, it had better be worth it.

With all of these seemingly conflicting circumstances in play, how can CIOs effectively take back control of their organization’s IT roadmap? Here are three things I advise IT leaders to start with:

1. Work closely with the business side of operations. In the past, CIOs and their IT teams would traditionally be in charge of technology decisions and make them in isolation, but that has shifted. Today, if you have a need to solve within the business, you can’t simply throw an app at it. So, it’s imperative for CIOs to communicate in lockstep with business decision-makers to understand these needs and desired outcomes.

In my many years of working on technology projects, the most successful have been where the business and IT teams worked collaboratively to deliver the business outcomes. While working for a telecom company in Canada, the organization demonstrated that the recipe for success was to optimize their supply chain and ensure product availability in their retail stores. The business and IT teams worked closely to design the processes and underlying technology to successfully deliver on this outcome.

Fortunately, it appears many organizations understand this and are developing stronger relationships between business leaders, CFOs and CIOs. In fact, a recent Rimini Street survey found that a full 77% of CFO respondents said last year’s challenging business landscape created a stronger relationship with their CIO.

2. Focus first on quick (but high impact) wins that drive innovation forward. An all-too-common reaction when the business side of an organization doesn’t like a system or process is to simply get rid of it. “This isn’t working for me” is a refrain that many CIOs have heard too many times. Making it worse, software vendors can be good at getting to business executives and making them believe they always need the latest and greatest tech. If this happens, the CIO becomes the victim of whatever the decision-makers purchased. The business side always wants the fancy red velvet cake with a cherry on top, but in times like these, they may only need a cupcake.

What CIOs need to concentrate on, then, is high-impact projects that help move the business forward. I’m not currently seeing a lot of major ERP overhauls, it’s more about quick wins. One organization I work with is a major telecommunications provider, and they’ve always been ahead of the game from a Digital Transformation standpoint. A recent quick win for them was addressing a specific process that helped them remain nimble and increase their subscriber base in the face of changing market conditions. Keep in mind that what a quick win looks like can depend on the industry. In retail, for example, it might mean improving the online shopping experience during a time when the bulk of physical locations were closed.

3. Always remember the real revenue drivers: your end-users and customers. One area I often advise organizations to focus on when looking for these quick wins is the customer experience. If you allocate some of your IT budget toward making things easier for users and customers, it tends to boost satisfaction, not to mention the bottom line.

I once worked with a chemical distribution business that wanted to make it easier for people to buy their products. Everyone thinks about Amazon as the industry gold standard, so they invested in their sales platform to create an improved purchasing experience. Among the many customers were farmers and pest control companies, so this company set up a system where they could browse the website for specific types of insects, click on it, and then view the combination of chemicals they needed to get rid of that insect.

It turned out to be an innovative way to help their consumers and keep them coming back; farmers would buy product for what they needed for the growing season, and later they would come back for chemicals to protect their produce.

In the end, there are two things we know for sure: fallout from the pandemic won’t end anytime soon, and neither will the desire to keep driving innovation forward. In this environment, it is as imperative as ever for CIOs to act shrewdly. And in most cases, developing strong relationships with business decision-makers and focusing on quick but impactful wins, all while keeping customers in mind, is a winning combination that will help get you there.