The Center recently hosted a virtual roundtable on an important topic to CIOs, Partnering to Drive Change through Analytics, where we explored how organizations are applying analytics best practices today, the business value that the best performing organizations are experiencing.

In preparing for the session, I developed some observations on the topic that I think provide a useful perspective for CIOs as you all consider taking action on getting value from leveraging analytics and creating business value in your own enterprise.

Not a new topic

In researching the literature prior to the session to provide some historical perspective on how far back this topic goes, I discovered that people have been talking about what we describe as this massive explosion of data, initially called information overload, for longer than many of us have been in this industry. From what I could ascertain, the earliest known attribution of the term “information overload” was credited to an IBM advertising supplement in the New York Times on April 30, 1961. So obviously this is not a new topic.

So what’s different now: more data than ever before

That being said, we are clearly at a new frontier of information overload and explosion of data, which is astronomically more challenging, but at the same time very exciting from the point of view of being able to impact the way we do business.

To put this into a context for today, I like to look at the retail industry, which is at the forefront of collecting massive amounts of data, and more importantly putting that data to use in changing the way they go to market, manage the customer experience, streamline the supply chain, and create the next generation customer. Walmart is often cited as a great example as a retailer leveraging data and analytics across all of these elements. A fact that I found particularly noteworthy - as of about nine months ago, Walmart was processing over a million customer transactions per hour, feeding databases that were estimated in excess of two and a half petabytes (roughly the equivalent of 167 times all of the books in the Library of Congress.)

Walmart has unprecedented insight into what their customers are doing, what they want, and how to respond across their 8,500 stores worldwide. At the same time, they need to find a way to translate that insight into actions that drive customer benefit and stakeholder value.

How should CIOs respond to this incredible opportunity?

“Revolutions in science have often been preceded by revolutions in measurement,” said Sinan Aral, a business professor at New York University, in a 2010 article in the Economist. He went on to say that just as the microscope transformed biology by exposing germs, and the electron microscope changed physics, the proliferation of data is turning the social sciences upside down.

I see that as representative of the conversation we as CIOs should be having now – how to apply this insight, these data, to become the microscope for how businesses can learn and advance ourselves and our industries. There are a few takeaways for me from Katharyn White’s presentation that I would encourage CIOs to consider in looking to manage these conversations.

• It’s a journey – the research presented reflects the evolutionary process of adopting, implementing, and embedding the value of analytics in the enterprise. And as Katharyn emphasized, the process of gaining buy-in and creating change is actually a core part of the implementation. In leading change management efforts myself over the years, I see that implementing analytics is the type of program that requires deep change across the enterprise, and core shifts in the way people make decisions, operate and go to market. CIOs can leverage their expertise in change management, as well as their enterprise-wide view of data and information, to make the journey more successful.
  

• Learn from others – the research also showed that companies can be successful getting to value across many industries; success in analytics is not industry dependent, or even geography dependent. There are companies of all types applying best practices and getting exciting results – whether it is in growing sales, increasing efficiencies, or improving individual customer interactions. Katharyn shared the view that success with analytics benefits greatly from a cross-industry perspective, and from seeking out examples from many other environments as a way to leapfrog in your own industry. This echoes my own experience – and that of the Center’s commitment to peer-sharing. CIOs should seek to systematically leverage learning from others to innovate in an emerging area like analytics.
  

• Leverage your C-suite relationships – by definition, getting value from analytics, especially as companies migrate from aspirational to experienced or experienced to transformed (as described in the research), clearly requires data or information to be collected across functional silos and/or across multiple business units. Whether or not the data collection and management moves to the point of being centralized within the enterprise, there needs to be an integrated and shared view of who is doing what, and how they data can be cleaned, verified and leveraged across the silos. This is an important opportunity for CIOs to leverage your hard-won C-suite relationships, and reach out to connect on an integrated view of the possibilities to move to value in your enterprise. One partnership in particular that Katharyn mentioned – the one with the Chief Marketing Officer – struck me as interesting for CIOs to consider. Analytics is at the forefront of where marketing and technology are coming together, and the partnership represents an emerging opportunity for CIOs to truly push the needle on analytics and how the company goes to market.
  

What are you doing in your organization to move the needle on the path value through analytics? What lessons can you share with others?

I recently read a Forbes article Solving National IT Issues: We must address national strategic issues from a technology--not political--standpoint, written by CIO blogger, Mike Schaffner.  While I respect Mike’s point that issues cannot be addressed from a political standpoint, I think he is missing the mark slightly, and doing a disservice to all CIOs.  The more I read and reflected on the article, the more it seemed to me that this is a movie that we have seen many times before.

Forget, for a moment, that we are talking about the CIO of the United States of America.  Imagine the more familiar context of a huge enterprise that is 200+ years old, complete with policies, procedures and methodologies – ways and means of doing business that give new meaning to the term "legacy systems", not to mention business silos.  Could there possibly exist a more complex (polite term for dysfunctional) environment in which to effectively transact business?

Now bring a newly appointed CIO into a newly created position – enterprise CIO, and by the way, define the newly created position in a way where it has an incredible sphere of influence (reporting to the CEO of one of the world's largest enterprises) yet has limited to no real authority, i.e. the line of business (silo) CIOs do not actually report to the new enterprise CIO.  When all of that dust settles, we have a glorious position with lots of responsibility (or at least expectation) and limited to no authority.

Now surround all of this with the worst economic condition that any of us (c-suite included) have seen in our lifetime.

Given that scenario, do you know anyone that would focus on why digital rights management is an important priority?  Not to make excuses – in spirit, Mike Schaffner has focused on a good set of important technology issues.  His list of strategic priorities is an excellent one.  His observation that Vivek Kundra has largely focused on "keeping the lights on and reducing expenses" (my words, not his) is, from what I have seen, correct.  At the last government CIO roundtable that I attended with the IEG and Public CIO Magazine, Vivek Kundra in fact presented his IT agenda and was most proud of the fact that he eliminated $80 billion in government IT projects that appeared to be either misdirected, not needed or so far off the tracks that they could not be saved.  He was able to then both cut expenses and re-direct a portion of the savings to other more productive efforts.

Sound like a familiar theme?  This is an example (on steroids) of why we created the Center for CIO Leadership – to help CIOs rise above the role of IT cost center manager and to transform themselves into better business (or government) people.  While I don't think that we ever envisioned transforming an enterprise quite as large and complex as the government of the United States, I believe that our understanding of the challenges, the opportunities and, to a growing extent, some of the solutions that we are developing are completely applicable.

If you were CIO of the US, what would you do?  Would you focus more on strategy, technology or politics?  Feel free to respond and share your opinions and suggestions…

We interviewed Center CIO members to gather input on where CIOs have challenges related to the Finance function, and in communicating with the business on financial matters.  We also heard their points of view regarding the need for CIOs to speak the language of finance and exhibit a set of financial capabilities.  This topic of finance capabilities has emerged as an increasingly important skill area in the “new normal” environment, and the insights raised here will serve as input to additional research on the topic of identifying and communicating the business value of IT.

The Top 5 Headlines from those interviews were:

1. The key capability CIOs need – now more than ever – is to have an ability to translate technology to a business benefit, sell it, and communicate it.
   
2. CIOs find the ability to understand and define the cost drivers of technology gives them the fact-based language they need to sell to business partners.
   
3. CIOs increasingly have to balance between pressures to cut costs while also finding ways to make the case for investing in innovation.
4. The need to cut costs and increase efficiencies can impact buying behaviors, increasing things like vendor flexibility and a shift to technology as a service.
   
5. While a deep financial understanding is not necessary, CIOs agree on the need to know the basics of finance, and on the challenges many CIOs still face in gaining these basic skills.

You can find the full pulsecheck interview synthesis here.

Offer your views on the CIO and Finance in the comments below or in the CIO and Finance discussion.