Digital leadership in 2018: The customer CIO

By Michelle Wycoff,

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What kind of CIO are you? That depends on how you spend your time. After you've done what's necessary to keep the lights on, do you concentrate on improving business processes to shore up inefficiencies or improving the customer experience to drive revenue?

The CIO role is rapidly evolving as organizations embrace digital transformation. Goals of transformation vary by company and so does the type of digital leadership required by the CIO. According to an MIT study, once CIOs are accepted as members of the senior leadership team, they have a choice to make. They can either focus on business processes, becoming an enterprise process CIO, or focus on customers, becoming a customer CIO.

Customer CIOs work differently than enterprise process CIOs. They also face unique challenges that they can turn into opportunities to deliver value.

Time allocation is shifting

To better understand how digital transformation changes the CIO job, MIT examines how CIOs allocate their time, how their priorities shifted over the past decade and what top-performing CIOs do differently. The report breaks down CIO activities into four buckets:

  1. Managing IT services
  2. Working with non-IT colleagues
  3. Engaging customers (including through APIs)
  4. Transforming enterprise processes

Most CIOs devote some time to each bucket, but their priorities are shifting. In 2016, CIOs spent an average 16 percent of their time with customers — compared to 10 percent in 2007 — which suggests enterprises are asking for more customer engagement from CIOs.

Meanwhile, CIOs spent less time with non-IT colleagues — 36 percent in 2007 versus 28 percent in 2016. This decrease comes when the need for collaboration is high: 80 percent of line-of-business executives see the CIO as a key senior leader of digital transformation, according to IDC.

CIOs also dedicated less time to managing IT services — 40 percent in 2016 versus 44 percent in 2007 — and more time to strategic digital innovation.

How customer CIOs are innovating

In top-performing enterprises, CIOs who focus on customer engagement, sales and peer connections are enabling mobile commerce, using social media for reputation management and introducing service-enabling core competencies with APIs.

What does that look like in practice? Leading customer CIOs do the following:

1. Use conversational commerce to build on top of existing platforms, monetize user data and create engaging customer experiences

Unsurprisingly, customer CIOs spend time talking to actual customers. They also work closely with sales and marketing leaders, as well as other key stakeholders in the customer experience, to determine innovative ways to engage digital customers. The following are some strategies CIOs can incorporate:

  • Build APIs on top of existing platforms that enable access to cutting-edge enterprise technology such as real-time cloud communications, mobile payments, chatbots and AI
  • Monetize user data to drive the customer journey lifecycle across industries
  • Bring the digital experience in-store with trackable insights using sensors, beacons, mobile app notifications and targeted advertising through smart shelves and other IoT-enabled technology
  • Design all-encompassing chat platforms or channels to engage customers and solve consumer problems

2. Use social analytics to drive employee engagement

Happy employees work harder, stay longer, say nicer things about the brand on social media and, in turn, deliver a better customer experience.

How do you know if employees are happy and engaged? That's a problem CIOs at top-performing companies are working to solve. Using analytics from enterprise social networks, they identify work-related data that can improve employee satisfaction and help leaders better engage their teams.

3. Use gamification to encourage greater employee collaboration and social sharing

Gamification is a popular way to interact with customers, but it also adds value inside the organization. By incorporating gamification technology into social collaboration platforms, innovative CIOs can accomplish the following initiatives:

  • Promote adoption of social collaboration tools
  • Automatically reward employees for collaboration and innovation
  • Improve employee education with self-guided and/or AI-based training content
  • Assess employee expertise so leaders can better assign tasks
  • Encourage and reward employees for sharing brand content on their social channels

Phaedra Boinodiris, IBM's senior developer advocacy lead, put it this way: "Social collaboration is not about technology. It's about connecting people, and it's changing the way business is being conducted. Similarly, gamification is not about games. It's about motivating the per­sonal and professional behaviors that drive business value. Together, social collaboration and gamification help companies reap great benefits — among them, the ability to deepen customer relationships, drive operational efficiencies and optimize their workforce."

Are you there yet?

CIOs are under pressure to deliver value in the form of digital leadership. Some CIOs turn these challenges into opportunities, but 45 percent are not there yet, according to IDC. To drive innovation, CIOs must find ways to spend less time managing IT services and more time on customer engagement, sales enablement and employee collaboration.

Are you ready to create value for your organization? Use the IBM CIO Digital Experiences Guide to learn about creating superior experiences for customers and employees.