Technology continues to move forward at an alarming pace but a large number of CEOs are failing to mobilise their companies to take advantage of these technological leaps and bounds. Why?
It seems that the link between organisational growth and innovative technology is being disregarded by CEOs. They prefer to ignore the importance of this function rather, perhaps, than admit their own ignorance. You could argue that many CEOs simply don't have the time to learn how IT fits into the organisation in the same way as marketing, HR and finance do. The latter functions often appear to involve more common sense, perhaps. IT is new and uncharted territory, and this could potentially explain why the IT function remains so isolated from the rest of the organisation.
But ignorance is no longer acceptable
We frequently encounter business leaders who consider their ignorance of basic technology as being perfectly acceptable. As a traditional business leader why trouble yourself with the technology as long as it works?
But today every sphere of business is impacted by technology, and the success of these businesses is often determined by the way technology is integrated and utilised. The unfortunate truth is that if you cannot engage in meaningful dialogue around how technology is used in your business, at best, you are missing an opportunity and at worst, you are simply not doing your job.
Understanding how to get the best return on investment is vital given the current volatile economic climate. CEOs appear to have great instincts about how their business generates a return from investing in a marketing project or new product offering. They also understand the importance of careful accounting and financial management. But, installing a new customer-facing application or enabling their workforce with a new device? It does not resonate in the same way. This, despite overwhelming evidence that the right technological solutions can dramatically reduce costs, drive up efficiency and streamline work flows.
Career suicide or fresh opportunity?
Technophobia at board level is often driven by past experiences of financial overruns, late delivery, wide-scale business disruption and low user satisfactions. While some level of apprehension is justifiable and sensible, significant change has taken place over the past few years to make the situation less intimidating. These include:
- Less risk: Over the last ten years, we have moved away from coding to configuration. This means that software packages are much less risky to develop. Even better, software packages can now be hosted by a partner (so called ‘Software as a Service’ or SaaS) meaning that capital and operational costs are vastly reduced and risks made much more manageable.
- Easy deployment: Technology can now be rolled out more easily. The technical innovations of the past were expensive and slow to develop. Today innovation cycles are shortened. The implication is that rather than paying for leading edge research and development, businesses can adopt a safer ‘fast follower’ strategy and remain highly effective.
- Standardisation: Greater adoption of standards have allowed an explosion of devices. These devices are able to communicate with each other because of common standards in telecommunications, hardware and software.
- Ubiquitous data networks: There are few places in the world where a customer or an employee cannot get access to decent broadband or mobile networks. Data speeds are increasing with technologies like 4G and future advancements will further improve what is already a great experience for most users.
Meeting the challenge head on
A frequent tactic is to place IT under the finance director. This just shows that the business is viewing the IT function as a cost centre rather than an organisational investment to deliver real and tangible returns.
To move forward and benefit from all the advantages that technology can bring to organisations, CEOs must accept some responsibility for integrating IT into the business at the highest level. IT can no longer be seen as a separate function or a range of isolated projects. Today, the IT department deserves to not only be understood in the same way as other fundamental business areas, but be integrated into the boardroom and acknowledged as imperative for future business success.
What will you do to ensure technology is not a route to disengaged customers and loss of competitive edge, but instead your vehicle for business growth and corporate development?
Jon Dakin is director of business transformation agency Boxwood.