An EMC study revealed that business leaders don't think their companies are ready for the data-driven future. Worse, they have no confidence in IT to correct course. Here's why it happened, and what IT can do to win back the confidence of business execs.
6 Ways To Master The Data-Driven Enterprise
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Do your business colleagues trust you? An EMC outlook report has uncovered some disturbing situations in the state of business in the data-driven age.
Only 30% of the 3,600 global business leaders surveyed in the report, released in April, said their companies are able to act upon their information in real-time. Nearly half of respondents admitted to not knowing how to get value from their data. Less than one fifth of respondents (24%) consider themselves "very good" at turning data into useful insights and information. When it comes to the data-driven enterprise, IT has a big job ahead and it's got to be completed fast.
The news is worse for IT than it first appears. Much worse.
"Seventy-five percent of business leaders who come through our doors do not believe IT can deliver the innovation needed to transform the organization," Jeremy Burton, president of EMC, told InformationWeek in an interview.
That's a staggering vote of no confidence in IT.
"Nine months ago we started seeing a bunch of business guys come through our center, and they didn't have the head of IT in tow," Burton said. "They would bring folks from R&D and others, but no IT."
According to Burton, the impetus for these visits by business leaders varies from company to company, "But the punch line is that they're looking at building custom software, something that largely hasn't been done in the last 10 to 15 years. And they think IT can't do it. So they hire dev teams to change and transform the company. That's what prompted us to do the survey; to figure out what's going on."
The research was conducted by Institute for the Future and Vanson Bourne on behalf of EMC. Vanson Bourne surveyed 3,600 business leaders across 18 countries, from mid-size to large enterprises in nine industries, to determine top business imperatives required for success today and over the next decade. The Institute for the Future led the creation of the study to identify and forecast the imperatives and shifts in the new digital world. The research questionnaire and imperatives were based upon in-depth interviews and workshops with more than 40 influential global decision-makers and experts across multiple industries -- a mix of academic, industry, nonprofit, and think-tank leaders.
A push for custom software hasn't been seen since the 1990s. In recent years, IT has been focused on moving out of custom legacy software and into commercial products. The goal has been to steadily decrease costs and improve efficiencies -- and mostly by mandate from the C-Suite.
"The trouble is that efficiency doesn't represent any differentiator for the company or brand," Burton said.
And there's a bigger rub too: What good is efficiency in the old sense of the word when every industry is being disrupted and transformed now? Innovation has replaced the call for increased efficiencies, there's no doubt about that. Yet, the prevailing opinion seems to be this familiar refrain, which Burton repeated: "IT is too focused on keeping the lights on."
He added: "In the mid-1990s, IT was at the center of innovation, but in the 2000s, the crash focused everyone on automation and efficiency. IT has gotten out of the habit of innovating over the last 10 to 15 years, and it has to get back into innovation mode immediately."
Savvy CIOs will see this as a great opportunity, and will jump at the chance to show their geek prowess once again. Indeed, there is huge opportunity here. Burton says less than 10% of companies surveyed in every industry are prepared to deliver the innovation needed. Nowhere to go but up from here, right?
How IT Can Lead Innovation
Burton said he and the EMC team gleaned many insights from the survey, and in their daily work with clients. He shared four tips, which we've paraphrased below, to help smart CIOs transform their IT organizations into places with which business colleagues want to engage:
Be willing to collaborate and to lead, learn when to do which. It's smart to recognize that business leaders at the top level know what needs to be done to transform the company or respond to disruption. Follow that lead as a collaborator, and offer ways to transform business or processes quickly, efficiently, and smoothly. Learn when to step up and lead transformation, and when to follow the business to help executives achieve their goals.
Understand that the notion of bi-modal IT is very real, and adapt to it. Burton said that the first mode is process automation, efficiency-building, and resilience. The second mode is DevOps and agile software development. Both modes must be in play simultaneously. In other words, use your tech prowess to innovate constantly, all while keeping an eye on efficiencies and costs.
Up your game in data processing. Burton said data processing will be stream-based and agile. Make sure you are set up for that, and make improvements and innovations in data processing as quickly and frequently as possible. It's now a data-driven world. Time to get on the racetrack and go for the trophy.
Get back into software development now. Business leaders are no longer focused on buying off-the-shelf software. They're looking for true innovation, and they think that starts with a ground-up rebuild of the company's capabilities. Design everything in a different way, develop new software, and find new ways to use existing software.
In a nutshell: Be bold. Innovation is not a game for the timid or the imagination-challenged. Without taking wisely calculated risks, you'll never regain the respect and confidence of your top business leaders.
Pam Baker is author of Data Divination: Big Data Strategies, which met with rave reviews and is currently being used in universities as a textbook for both business and tech courses. It's also sold to business audiences in the general market. The US Chamber of Commerce and ... View Full Bio
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