CIOs: ‘Lead the disruption, be the disruptor’

Charles Araujo, CEO of the IT Transformation Institute, lists three steps CIOs can take in the next six months to help prepare their organisation – and their IT teams – to lead the changes brought by cloud and other technologies

Charles Araujo believes the typical organisation today operates “very much in the industrial age even if we are living in an information economy”.

There are a few exceptions, with some of the dotcom organisations, but organisations in general are not fully prepared for how disruptive technologies will be for businesses, says Araujo, who is the CEO of the IT Transformation Institute and author of the book The Quantum Age of IT: Why Everything You Know About IT is About to Change.

This has a double impact on IT professionals, and CIOs, in particular, he says. He says CIOs will be dealing with disruption within their organisation and also provide for the needs of groups they work with including customers.

Charles Araujo, founder and CEO, IT Transformation Institute
Charles Araujo, founder and CEO, IT Transformation Institute

Build an army of leaders that speak in financial terms, people that can lead innovation and collaboration efforts

“You need to lead the disruption, you need to be the disruptor,” says Araujo, who is in New Zealand as a speaker for the Digital Catalyst Summit Series. “You need to be in front of this if you want to create value in the organisation, you can’t afford to wait.”

He lists three steps CIOs should be doing in the next six months to manage the disruption impacting the organisation:

Step one: Create a cloud strategy:

“Every CIO has to have a cloud strategy not because it is cool and sexy,” states Araujo.

“If you are investing your capital resources – financial as well as political – in building infrastructure, you are wasting your time.”

Araujo says he is utterly convinced in the next five to 10 years, depending on the size of the organisation, 80 to 90 per cent of what organisations do today in-house is not going to be done within the walls of the enterprise.

“The smaller the organisation, the faster that is going to occur,” he states. The larger organisations will have a slower shift but the shift to cloud services is going to happen, he says. “The CIO must not fight it but lead it.”

He says many CIOs look at the shift to cloud services from a cost standpoint, but the cloud “is all about agility and adaptability”.

Is it about, “How do I create an environment and architecture, a platform, that allows me to respond to changes rapidly?”

“Businesses are being thrust into the new environment, the markets are changing faster than they can predict it,” he states. “You need to create an environment that will allow the business to respond in an agile fashion.”

Step two: Get out of the business of running infrastructure

He says CIOs should use technology to “provide competitive differentiating value” to the organisation.

How do I create an environment and architecture, a platform, that allows me to respond to changes rapidly?

Charles Araujo, IT Transformation Institute

"We need to get out of the business of running infrastructure," he states. “How do we leverage technology that allows us to leapfrog the competition in some way? We have to be moving down that road."

Step three: Build a team that is going to be relevant to the future

Araujo calls on CIOs to invest massively in their “single most important resource” – the ICT team.

“They must be in the business of leading technology strategy,” he states.

This shift requires entire new set of skills to manage what he calls the “new ecosystem”.

“Build an army of leaders that speak in financial terms, people that can lead innovation and collaboration efforts,” he states. With the shift towards cloud services, the new environment requires managing “loose coalitions” and different “value chains”.

“It is very different from the skills sets most IT people have today,” he says, and they are present in the current workforce.

Araujo says when he speaks to IT professionals, he discusses different paths ahead for them.

One of them is they have to be able to compete to get a job with “the Microsofts, the Googles and the Amazons of the world”.

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Meanwhile, every organisation is going to keep some hardware technologies, the 20 per cent that is kept in-house. “Your other option would be to be the top 20 per cent of your domain,” says Araujo. “So if you have 10 network engineers, you have to be the best two.”

Another option is to transition to a business leader or relationship manager. “With the rare exception, most IT people are capable of making that transition if they chose to,” says Araujo.

He believes the CIO role is going to become even more strategic and a “great pathway” to other roles.

He says a number of CIOs “have taken the leap” to a chief operating officer role. As well, some CIOs have taken on additional responsibilities, like being both CIO and COO.

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CIOs are also coming from outside IT itself. He cites the case of the EVP and CIO of a large retail company who started as a store manager, then headed IT when the company opened stores in Europe. “He did an amazing job” which led to his global role.

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Read more: EROAD: Driving through clouds

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