Digital innovation: whose business is it anyway?
As digital transformation continues to gain weight in today’s business environment, the C-level leaders of our organisations are figuring out how they fit into the picture of the new digital enterprise.
Vlerick gathered a panel of Chief Marketing Officers (CMO) to discuss their experience with digital innovation, focusing on the collaboration model with their respective Chief Information Officers (CIO). The observations revealed a significant trust issue and, almost paradoxically, a high expectation pattern at the same time. Each of the CMOs represented an organisation with a moderate to high involvement in digital innovation, and could individually be characterised as tech-savvy. One could say, a great platform for mutual understanding with a CIO. In fact, for half of the panel participants the opposite was true.
There are 4 key observations about digital innovation governance from a CMO perspective, which we think are noteworthy and which can be applied to many organisational contexts, perhaps also yours:
1/ The CMO wants his or her share of the prize. Digital innovation is a growth domain in organisations, in terms of strategic – and hence budget – importance. The IT savvy CMO will claim at least a part of that responsibility and budget, if not completely, in which case the CMO insources the digital innovation programme. Most CMOs leverage their proximity to the customer as a sensible and powerful argument, to increase their share of the prize.
2/ In the digital innovation process the CIO is a welcome partner, but not to the expense of control over the digital business strategy, at least from the CMO perspective. If they collaborate, CMOs prefer to have the CIO involved from the early stages of digital innovation, in order to be more effective. The CIO is then expected to be able to think in terms of customer value creation and to suggest ways to decrease the time-to-market and cost of digital innovations.
3/ A structured collaboration process between CMO and CIO, however, is mostly absent. It is ‘ad hoc’ at best, often ‘live and let live’, and worst case scenario, a true turf war. CMOs describe the IT governance rules and processes as a strait-jacket, which is, apart from personal elements, the number one reason to limit the CIO’s involvement.
4/ There are glimmers of hope. CMOs who indicate a strong connection with their CIO counterparts, seem to be more successful in the long run. They describe their collaboration as a partnership to the benefit of sustainable end-to-end digital innovation, as an alternative for fast but local innovation.
These observations in turn lead to more questions, deserving further research:
- If CIOs are not structurally involved, how long will it take before digital innovation initiatives get stuck in scalability, compliance, reliability and other issues?
- Digital transformation is usually accompanied, at least if it is more than a gimmick, by enterprise-wide cultural change. How can deep change succeed, if even the C-suite is not aligned about digital innovation?
- Then there is the new kid on the block, the Chief Digital Officer, too. Does a CDO demine the situation or does he/she increase digital innovation governance complexity even more?
Should you be interested to discuss this, do not hesitate to get in touch! Follow us on Twitter via @vlerickBT or read other articles on digital transformation.