CIO: Supply or Demand?
The usual business model is to create demand (aka customer relationship management) and then fulfil the associated order (supply chain management).
Both are needed. And it is increasingly common for elements of either or both to be outsourced to a third party. Outsourced elements tend to be of lower relative value to the organisation, but that bar is rising as I write.
So the question is whether your IT function is supply or demand focused?
The former model requires keeping the machines ticking over, with non-cyclic activities being triggered by system failures or user requests. Sustainable organisations that make no effort to stimulate demand in their customer base are exceedingly rare. And similarly IT functions that make no effort to influence the ‘buying’ habits of the users is destined to spiral into oblivion.
Forward thinkers in the market are encouraging CIOs to move their focus from supply to demand. Hand over the technology elements to those that (are at least supposed to) do supply well, ie the vendors. The demand-focused IT function is business-oriented, proactive and constantly looking for ways to use IT in innovative ways in respect of cost management, governance and business value.
The demand-focused IT function has a skeleton staff management team focused on supply, and thus supplier management. It also has an enterprise architecture team to ensure the integrity, reliability and suitability of the technology underpinning the business. However the majority of the IT function is customer-facing.
What were technologists are now business consultants with a strong grasp of how IT can improve the organisation. These consultants challenge user thinking. They are service oriented but not servile. Partnership is key.
In my view the worth of the CIO needs to be measured less by headcount and data centre footprint. The new focus needs to be more on customer satisfaction and the KPIs that the business as a whole is working to.
Don’t fight the vendors because they ultimately control the supply of technology. Accept that and work with them by repositioning the IT function as what is in essence the IT industry’s customer experience function.