Digital transformation is rapidly changing the CIO and IT relationship with lines of business and corporate functions like marketing and finance. As the proliferation of technology outside IT increases, the CIO must establish relationships and find ways to serve and partner with business colleagues. 

In this episode, we talk with Chris Curran, Chief Technologist and Principal in the US Advisory practice at PwC and responsible for technology strategy and innovation. Chris oversees the firm's Digital IQ research series, an important set of data points on digital transformation and the impact on IT.

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Video Transcript: Chris Curran, Principal and Chief Technologist, PWC: Digital Transformation and the Evolving CIO

Michael:

(00:04) Okay, welcome to CXOTalk. We’re starting a few minutes late due to problems with Google Hangouts, you have to love technology. Anyway I am Michael Krigsman, this is episode 138 of CXOTalk and today we’re talking about digital transformation. We’re talking with Chris Curran, who is Chief Technologist and Principal at PWC and who has been doing research on digital transformation and the linkage to performance for a number of years. Chris thank you so much for joining episode number 138 of CXOTalk.

Chris:

(00:54) Hey Michael thanks so much. 138 episodes that’s amazing. Anyway thanks for having me and look forward to spending some time talking about all things digital and our digital IQ survey which we’ve just launched a couple of weeks ago, which has been running since 2007 to look at some of the leadership behaviors and priorities for company’s who report top performance and try to help give all leaders across the world some insight into what some leading companies are doing to get the most out of digital.

Michael:

(01:32) Well your survey is a large one. How long have you been running the survey for?

Chris:

(01:38) So I think this is our seventh year and this year is our largest survey. We’ve got 2000 business and IT leaders who participate across 50 countries and I believe about 25 industry sectors. Something that makes the survey unique is that it’s not an IT survey, it’s not a CIO survey. It’s a leadership survey where we look at input across the board from CEOs to CFOs to heads of HR and CIOs across the board to try and understand you know their perspectives on Information Technology and digital. And when you know I say digital I mean the big D digital, capital D, right enterprise and that application of technology. Not the little D you know just marketing or customer facing technology.

(02:31) But that’s part of the process in learning and communicating to you know in the marketplace and with our clients is to try and help them figure out what they mean by it and what they hope to get out of it.

Michael:

(02:43) And actually we’ve already had a comment from Twitter Chris, somebody is asking how do you define digital and how do you define transformation in this context?

Chris:

(02:55) Well we define and in fact we define Digital IQ as the degree to which an organization weaves Information Technology into everything they do from strategy to execution, customers, employees, operations, innovation, the whole gamut of the enterprise.

(03:20) And so you know, the definition of digital is a great conversation because you know as technologists we’ve always been digital and so you know, the latest round of buzz around the world digital is puzzling to some and you know I had my a-ha moments a few years ago you know when the digital term was coming back in vogue and a buddy of mine who runs a small ad agency here in Dallas was telling me about you know, his perspectives on it and you know as simple as the ad agency’s terminology of talking about the channels in which they communicate. So there’s the radios channel, the TV channel and the print channel and the digital channel.

(04:11) And you know so digital there I guess the renewed sense of interest in digital from his perspective came out of you know the agency’s talking about their digital channels versus the thing we’ve been calling digital all along which is Information Technology, data, and analytics and all that good stuff. So you know, that was an awakening for me of sort of understanding those different perspectives, and I think it’s a smaller story that brings to light the larger story which is everybody is interested in technology now, right. This isn’t just about the CIO and the IT organization helping how to figure out how to automated business processes and crank reports out.

(04:55) It’s now you know, in everybody’s interest to figure out how to improve their customer relationships, improve their products because they are seeing how it’s happening in their own personal lives, this whole consumerization in the technology world.

(05:09) So that’s why there is a lot of energy behind it I think and not only that there is so many more sources of interesting Information Technology and emerging technology out there now than there were before. And the level of innovation and creativity has gone you know so far up that it’s creating ideas of interest in all of our leaders across the C-Suite.

Michael:

(05:33) Okay, so digital is not just about marketing, it’s not just about IT but it’s a broader organizational mandate and your study, the Digital IQ Study examines the link between digital transformation and corporate enterprise performance. So let’s explore that because I think that is a missing piece. For many of these conversations around that performance piece is missing. So to begin with how do you define performance, what are the kinds of performance metrics that you look at?

Chris:  

(06:15) Right so each of the participants in our survey tell us their growth rates in revenue and margin and we use that to segment the participant group into top performers and others, and the top performer segment is roughly 20% of the sample and we correlate that group to their answers in the survey. And you know our survey spans strategy and innovation, operations, operating models, skill sets, project performance measurements and metrics. A lot of leadership priority and management practices kind of questions versus the quantitative you know, how much do you spend on that xzy kind of questions.

(07:08) And so this year we did something a little bit different. We decided we we’re going to build a score, a digital IQ score and see what we could learn from that. And so we formed what we thought was a set of behaviors and attributes that we thought would correlate to high performing companies and there were 26 of them, and in our survey we asked for level of agreement statements around those 26 attributes.

(07:43) And what we found after we analyzed the data and correlated it with the margin and revenue growth data, that there were 10 of them that were very correlated to performance. And those are highlighted in our study this year, which you can find at pwc.com/digital IQ.

(08:04) So each of those uniquely are correlated to performance, and then together we created a digital IQ score which has two interesting characteristics. Those top 20% digital IQ scores in our survey base were twice as likely to be top performers in margin growth and 50% more likely to be top performers in revenue growth.

(08:37) So if you scored high in those 10 attributes, you were twice as likely to be a top margin grower and 50% more likely to be a top revenue grower.

Michael:

(08:46) So what is the magic of these particular attributes and also I think you should tell us what those – I know you went through them briefly, but give us a listing of those attributes. And I also just tweeted the URL, pwc.com/digitaliq if you actually want to  see the survey results as we’re talking.

Chris:

(09:07) Right, so there’s 10 and these are rated by level of agreement with the statements. So the statements are the CEO and active champion for digital. Digital leaders are involved in business strategy. Formulation, business strategy is business aligned and shared across the C-Suite. Business and digital strategies are well communicated across the organization. We look outside the company for new ideas. Digital investments are made for competitive advantage. We effectively use all of our data to drive value. We proactively plan for cyber and privacy risks. We have a single multiyear roadmap for our digital strategy and we consistently measure digital investments.

(09:56) So those are the 10 who individually and then together correlate with performance.

Michael:

(10:02) Okay, so what is the common thread among these 10. Well first off, why did you select these attributes and what is it about these 10 that drive this correlation to higher performance?

Chris:

(10:18) Well so the data selected the 10, we selected 26 of them that were organized pretty neatly I thought. Initially when we build it across strategy, innovation, operating model, talent, skills, technology and execution and so we thought there was going to be a pretty well organized framework across those dimensions. But what we found was once we did the performance correlation, only 10 of them were super highly correlated, and that’s why we extracted the 10 out of the 25 or 26.

(11:00) So what’s a common thread through these? I don’t know if there’s a single common thread, but one of the things that strikes me when I think about these and when I talk about them is how important communication is. You know, and that’s another one of those sort of Holy Grail things I think. You know, we talk a lot about change management, communication and things like that and those all sound like really fuzzy hard to grasp onto things that we intuitively think are important but were not quite exactly sure how to get under the covers of how do you really communicate to really drive change.

(11:38) And so you know, I was at the Gartner symposium this week, and had a chance to see Jeff Immelt, who is the CEO of GE in a fireside chat kind of interview, and talking about a CEO who is champion for digital, I mean Jeff Immelt he is the poster child for this, and the interesting thing is that you know he’s up there, he’s at a Gartner conference. You know, and why is the CEO of GE at a Gartner conference? Well he’s there because he believes that all industrial products companies are also going to have to be software companies.

(12:20) So harness the data, you know streaming off of all the sensors of all this heavy equipment and actually be able to drive and connect that data into performance and process improvement and innovation and all kinds of other dimensions.

(12:34) So, you know he’s there communicating their vision, and also communicating the same inside of GE I’m sure, and having that level of leadership is so important because for example you know he talked about divesting businesses to refocus on becoming digital. And only the CEO can drive that kind of change, right the vestures and reinvestment and they just recently created a digital business unit of their that isn’t just an overlay business unit, it’s a real business and it’s going to grab all the different parts of GE and put them in this digital business. I think leadership and communication is a big thread that goes through this.

(13:25) Another interesting thing around communication is when we first got these 10 attributes and saw that they were the ones that were most strongly correlated, we had a client who was running a leadership workshop and wanted to know if they could use some portion of this digital IQ study to help generate some conversation. And so we said sure, and it just so happened that I had hot off the spreadsheets, the 10 attributes. So I said, let’s go and score these 10 attributes for what turned out to be 125 leaders across the organisation, to see if it would really resonate with them. And I was a little worried because you know they’re a pretty digital savvy organisation, so I was a little worried that it would be kind of like they would be off the charts and it wouldn’t be very interesting.

(14:20) But one of the things that we learned was that while they scored very highly in some of these attributes, two or three of them really created some interesting conversations for their leadership conference. Because for example you know, they believe very strongly in the need for getting value out of their data and analytics, but they didn’t score themselves very high in being able to do it because they just hadn’t built the capabilities yet.

(14:51) So as strongly as their C-suite is behind their digital program and their CEO is a champion for it, you know they still had a lot of room to grow around communicating throughout the organisation, getting the most value out of their data and measuring their investments. Those were the three that popped out.

(15:11) So to me it’s not all or nothing. Everybody is going to have a different outlook on these attributes but hopefully provide some guidepost for organizations to help to priorities in where they’re going to spend their efforts and not only as a leadership team but also within their teams and businesses.

Michael:

(15:33) So, a key element then is the measurement, a establishing a linkage or correlation between what are the digital activities that you’re undertaking and the business result, and there can be a range of business results. Now, we have a question from Wayne Anderson on Twitter, who’s wondering you mentioned innovation as being one of those potential results, how do you go about measuring innovation? How does that come into play here?

Chris:

(16:06) Yeah, there’s a lot of dimensions to the innovation topic. Let me start with a question that we asked the survey participants around the value in sort of their reason for investing in digital, and again digital when we say that, were talking about you know digital enterprise investments, which is basically all of the information technology investments that an organisation would make for strategic value and for operational value.

(16:33) So, we asked what are you hoping to get out of your digital investments? And the top three answers were revenue growth, and so almost 50% I think it was 45, 48% said that they wanted to grow revenue. The second was improve customer experience, that was 25%, and 12% said they were trying to grow margin. So those were the top three reasons, the number one reasons that people chose.

(17:12) 1% said that disruption or either trying to disrupt their markets, or preparing to block disruption or to fend off disruption was their top reason for investing in digital. So when we said and included the top three reasons, 92% included revenue growth, 8% included disruption.

(17:42) And so, when we get to the innovation discussion, you know the vast majority of people that we surveyed said their companies are focused on growing revenue. Right, growing their current business model revenue, 8% said somewhere in their top three priorities that they were focused on some sort of disruption. Then you say okay, let’s think about that in the context of innovation.

(18:07) That implies that those 92% that if they have an innovation programme are focused around innovating around their core business, you know innovating for a new market, disruption and that type of thing.

(18:19) So I just start with that context because I think it’s pretty interesting, and especially with all the buzz in the marketplace around disruption. You know we talk a lot about interested companies who are disrupting food service, or transportation or the hospitality and hotel businesses, automobile businesses. But at the same time, at least our survey base tells us that they are not actively investing in it yet.

(18:51) So I am really looking forward to seeing the data next year to see if that number starts to move up as more companies say okay, my core business investing in digital, I’m making good progress there and now I’m going to start divert more of my dollars to learning about disruptive potential in my markets.

(19:14) How do you measure innovation is something that we’ve tracked over the years. Before we talk about that though I’ll throw one other idea out there, and that is that the innovation process, while it should be a process, it’s not the same process, should not be the same process that we use for our typical project life-cycle.

(19:43) So the stuff that we want to go out and get a return on investment around, because we are putting a new CRM system in that we expect to improve process throughput or increase customer lifetime value of whatever, those all have distinct ROI like business cases behind them that we estimated and calculated, and hopefully we try to track afterwards to see how well we did.

(20:07) But the innovation process you know – I’ve drawn a blank on who said it, but Peter Drucker said that innovation is work, and I like to think of it that way. It’s a different kind of work, but it’s very distinctive kind of work that needs to be managed and tracked just like every other work we do, or it’s going to be nebulous and we won’t know what we expect out of it and we can’t manage it and then it won’t happen because our leaders won’t give us more money to do more innovation.

(20:44) So the first contextual point there is that you know most companies say they’re really not doing this disruptive kind of innovation right now. The second point is that you can’t use the same sort of ROI orientated processes to drive innovation.

(20:59) So how do you measure it? You know we’ve asked those questions and we’ve gathered data around you know, some people measure it based on the number of ideas that they put through their innovation process

(21:11) Some folks measure it based on the number of patent’s that the file out of that process. Some folks measure it around the number of ideas that come out of the back end of their innovation process and go into the ROI process. Some folks try to measure it it in terms of the actual value that they get in the marketplace, which is a lot harder, but would be the ultimate goal if you could do that.

(21:36) So, lots of different ways to measure it and it is important to measure it. We’ve just got to think about it in terms of measuring different things, because we are doing different things. We’re trying to manage new ideas to change existing processes, to create new processes and activities to create new products, and for some people ultimately you know creating new markets and new business models.

Michael:

(21:59) You know, Chris I realise that digital transformation is not just an IT activity or a marketing activity, but I talk with a lot of CIO’s and one of the big questions that CIOs have today is what are the appropriate metrics that they and IT should be looking at? Because the historical technical metrics, things like systems uptime, latency, and application availability in today’s world are pretty meaningless, now they’re important, right. The system has to work and it has to be there, but if a CIO wants to be delivering higher value, what kind of measurements, metrics, KPI’s should they be looking at?

Chris:

(22:51) Yeah, I think maybe working backwards from you know the mission and objectives of the organization and its functions is one place to start. You know, one of the things that organizations depend on on the IT function to do is help them run their technology projects. And something that’s always fascinated me is the project management discipline in organizations, regardless of is it an IT project or not, just the fundamentals around managing, planning, organising, measuring, staffing, evaluating projects tends to be in the IT function.

(23:31) So, you know one of the things that I think is important is how good are you at executing projects? And one of the questions that we ask in our survey is you know, is for success rates around projects. Remember, I don’t know if they still do it, but the Standish Group used to do a study around project success rates, which I always looked at and was very interested in over the years and I don’t know if they still do it. But we ask a similar sort of question just so that we have it for our survey participants for the percentage of projects that are successfully delivered on time, on budget, and then within the originally planned scope that I think is a little additional flair that I put in there because it is easier to cut scope than to cut budget to affect the others. But you know are you delivering what you set out to deliver is the third leg of that stool.

(24:29) So you know the data is I don’t recall the specific data from this year, because we didn’t include it in our printed report but we will include it in some subsequent reports that come out of Digital IQ this year.

(24:42) I believe it was about two thirds of companies said that they were on time, on budget within planned scope, and I think whatever the delivery metrics are around executing projects, I think that would be one set of them that I think every IT organization should be focused on.

(25:00) And then the question is you know how do you attach some metrics to the broader digital enterprise, right. So how important is it to the IT organisation to drive customer appreciation and satisfaction with digital products. You know, should the IT organisation have some kind of metrics around usability that type of thing. I think when you can maybe start figuring out how to measure the interactions between the software and technology that an organization delivers and their customers in satisfaction in using it, those would be some interesting things because you know that’s what we’re trying to do. We are trying to improve customer experience with one of the things that we are according with our survey participants.

(25:56) So, how do you measure customer experience in the context of what IT can influence, so that would be another category of things that I would explore.

Michael:

(26:04) Yeah, that’s a particularly interesting one. When you were talking earlier about project management metrics, it brings to mind several CIOs that we’ve had on CXOTalk including Kim Stevenson, who is the CIO of Intel and Brian Lilley, who is the CIO of Equinix, a large data center provider have spoken about operational excellence and the need to deliver projects on time, on budget and to get the results that you are looking for from your projects as a baseline for IT to establish credibility. But you asked the rhetorical question to what extent should IT have metrics that relate to business outcomes like usability, customer service, customer experience. And so let me put the question to you and in your opinion, how closely should IT be linked to those kinds of business orientated metrics?

Chris:

(27:03) Yeah, a good question. One of the questions that we ask in our digital IQ survey is what is the role of the CIO in IT in the context of this big digital question.

Michael:

(27:19) Yes, tell us please.

Chris:

(27:20) Right, so the first option was everything market facing and internal regarding digital, the second option was internal IT functions plus technology innovation, and the third option was just internal IT. So 41% said that IT leads all digital enterprise investments that’s currently. While 31% said that their IT was leading all internal IT efforts including innovation. 28% said leading internal IT only. So that’s today, 41, 31, 28.

(28:15) And then we said what would this look like in three years? And then it changes, where 36% say leading all internal IT efforts including innovation, and 34% leading all digital enterprise investment. So basically the shift in our survey participants said they see a shift from ITs role being the majority of them said leading all digital enterprise investments to leading all internal IT efforts including innovation.

(28:40) And so to the point around the measurement question, it depends on what your measuring, right. If you’re measuring all digital enterprise investments, then I would expect IT and the CIO to have more metrics regarding the market facing use of technology. So, does it make sense to make IT heavily incentive measured on customer satisfaction? Maybe not, but maybe it would make sense to create some more tangible measures like do some surveys on customer engagement around the technology solutions, you know the apps and the websites and things like that.

(29:33) Maybe if more metrics around the average stay on the website for customers, things like that, that go to point towards the usability and things like that. Or maybe more direct measures around usability. So my point is if IT is indeed leading all enterprise digital investments, then yeah they should have some measures that are orientated around those using the technology both internally and externally.

Michael:

(30:02) So Chris, we have a question from Bob Rothman who is wondering, so who should own digital transformation? Should it be under the CIO, should it be under the CMO? Who is responsible for this?

Chris:

(30:18) Yeah, there’s kind of two parts to the ownership. There is the ultimate owner, the how does the organization view its leaders in the context of who ultimately owns digital. So that’s a sort of one ownership accountability point, and then there is the who is running it and driving it day-to-day.

(30:37) So we asked the question, which executive is ultimately responsible for digital enterprise investments? So if you ask me that you know five years ago, I’d probably say well that’s the CIO. Or maybe if you take the word investment literally, you might say CFO.

(30:55) But today, the responses are 34% CEO, 27% CIO, 14% CFO, and 14% Chief Digital Officer. So in terms of the ultimate ownership you know a third of a company says the CEO is the ultimate owner of a digital enterprise investment which I think is pretty awesome.

(31:25) So 34% of the sample out there are the Jeff Immelt’s of the world you know and I think that’s where it should be you know the ultimate ownership of this stuff because this is about creating a digital enterprise.

(31:39) I think you know the other thing that’s interesting is the Chief Digital Officer you know popping up 14%, so that’s you know a couple of hundred of our survey participants who said that the Chief Digital Officer was the ultimate owner of the investment. And given that’s a relatively new role, and certainly not everywhere I think that’s pretty interesting to.

Michael:

(32:06) So these are business projects and they need to be driven or rightfully should be driven by the business owner so to speak, where does that leave IT and the CIO?

Chris:

(32:28) So one of the questions is – I should throw out some more data, so we ask a question, and we’ve been doing this question for several years now to. What percentage of the enterprise technology spend is outside of the CIO budget?

(32:50) Three years ago it was about 35%, last year 50%, this year 68%. I mentioned that I was at the Gartner symposium and they said that their number was about 50% this year and they asked a similar question.

(33:03) So whether it’s 68% or 50%, it’s a lot and you know IT doesn’t control the budget anymore. They have some of it, so the question is so if we are not in a world of control any more, we are in a world of influence you know what we do? So I sort of wrote a blog that sort of tried to redefine the potential roles of the CIO you know on my blog CIOdashboard.com and talked about you know it’s not control any more, it’s about collaboration and communication and consultative relationships. It’s not about information as much as it is about integration. It’s not about organizational control, it’s about outside in thinking.

(34:01) It’s about bringing in the outside and being the best prepared, and to bring the best ideas about what’s going on in the marketplace to the organisation. And so you know, a couple of things that I think are part of this, one is if you think about where the innovation is coming from that everybody’s so fired up about, it’s not coming from big organizations. The big organizations may be the ones that end up firing these big ideas. But they are coming from the start-up world, from incubators, from the universities, from open source; from the makers you know those environments. Those environments and those places, and those people are not places and people that enterprise IT or enterprise in general has expertise in. They don’t integrate with them, they don’t know them, they don’t you know love them and they aren’t them.

(34:57) And so a big place I think IT can define itself moving forward in this much more rapid innovative technology world is embedding themselves in these places, in these innovation places. And so that’s kind of what I mean by bringing the outside in. So that’s one area that I encourage you know technology leaders to get smart about and to share and what they learned.

(35:23) And then the connection point, part two is taking those ideas and building prototypes and demos that help to communicate. So back to those 10 attributes. You know a lot of those 10 attributes that correlate with performance, or are about communication.

(35:39) So one of the best ways to communicate ideas around new technology is through demos. You know demos are worth a million words. You know, so let’s figure out how to build more capability within our technology function, to take those outside ideas and build prototypes and demos, communicate better to the organization in what is possible.

(36:03) And I think you know I think integrating all those new ideas together in the organization is important as well. And I think another role for IT is to develop a much stronger skillset around integration, because more and more we’re going to be bringing third party services, and ideas and cloud, platforms, and apps and all kinds of things that we are not building or we are not the primary builder of.

(36:26) But we want to integrate with our customer data, our billing data and pricing data, and all the history data that we have, and we want to get the value of all of the analytics and insights that can come from connecting all of that data together, where no single third-party is going to have that view like we do.

(36:44) So I think those are the three areas, outside/in learning, demos and prototypes, and integration are the three things I think can really help define the future for IT.

Michael:

(36:56) So this creates a big challenge for IT because for two reasons. Number one, many established IT organizations are run by people and employ people whose focus is technology. It’s not communication, it’s not thinking about organizational innovation. It’s about keeping systems running, that’s number one. And number two there companies in many cases that view IT as oh, those are the people who keep the system up. So there’s a gap that has to be bridged on both sides.

Chris:

(37:37) Yeah and what I say communication, I’m not saying that I think everybody in IT needs to go and be a public speaker. What I’m saying is that if I’m an operations person and I’m you know, seeing a lot of challenges around penetration threats and testing. So if I’m a cyber person and that’s the security area I practice in, what I’m suggesting is go figure out where some new sources of innovation around penetration testing are out there in the world. Right, they are probably not coming from the large established security vendors.

(38:16) I mean they’re certainly thinking about those things. But go think about and learn about where those new ideas are coming from and then build some little prototypes and demos to figure out how you could apply those to your context, and then communicate them to your peers and your leaders. That’s what I mean by communication, not so much you know, everybody needs to stand up and be in the C-Suite presenting their ideas.

Michael:

(38:41) But it’s an issues of capabilities, issues and talents, competencies, experience and also the corporate culture inside the organization. Is the organization willing to except IT playing a more partnership role?

Chris:

(38:58) Right, you know it seems pretty straightforward to me that the organisation that has their employees in it and that they’ve made investments and the way IT one of their own business functions would be one that they trying to figure out how to work with. But it’s not always the case, and I think a lot of it is going to be getting back to the leadership question you know, who is driving the, you know, who is ultimately responsible for the digital investments and what is their vision.

(39:28) Is their vision to you know create the capabilities themselves, or is their vision to partner with others to do it. And as you said you know, there’s less and less importance on infrastructure and sort of up time and service fundamental baseline infrastructure service delivery, as more of that gets provided by third parties. So you know we have to figure out how to shift our focus into some of these other areas.

Michael:

(39:55) What do you think about this notion of two speed IT, I think some of the Gartner people calls it bi-model IT, the notion where IT is simultaneously undertaking traditional infrastructure activities, but at the same time has a group within IT that is undertaking more innovation activities.

Chris:

(40:17) Yeah, I think I’m bought into that idea and I think so for example I’m working with a commercial real estate firm who is trying to figure out how to bring more tools to their brokers. And you know those tools have a very mobile, very intelligent, very busy set of brokers that are out there trying to do large commercial real estate deals, so they have a lot of expectations about the kinds of technology that you know needs to run on their phones and their tablets and things like that and give them a lot of insight in a very short period of time which is not a typical sort of IT software project.

(41:05) And so we’re talking with them and doing the same with some hospitals, and high-tech companies and others who are building these what I call fast tech capabilities. And I think one of the reasons to do it is to attract some of these other kinds of new tech stat skill sets. If you’re trying to recruit folks into sort of you know long form, waterfall, DLC, ERP, CRM kind of environments it’s going to be nowhere near as attractive as being able to say, you know we’ve got this mobile app factory and its DevOps based. And you know we have business and IT people embedded in the teams, and you know we are doing weekly sprints and we are releasing apps every month or whatever it is.

(42:05) I think you know, that’s being part of being able to attract the talent and build the talent is having those separate environments. I think it makes sense, because as we’ve learned over the years with different waves of Information Technology paradigms if you will, back in the client – server days or the object and analysis design days. You know, there was some that believed that those were that we should transform our whole IT organisation into those things, into practicing, distributing computing architecture or practicing object analysis and design.

(42:42) What we learned was everybody is not in tune with that and not a good fit with those things. And in fact we didn’t really need all those things for everybody, because mainframe still made sense. You know the minicomputer world still made sense for some business problems, and likewise the web, mobile, and IOT-based systems are going to make sense for certain kinds of systems, but not all of them. So I think the two speed bi-modal idea makes a lot of sense.

(43:11) But the thing I don’t like about it is, it implies that they are two separate things, and the reality is that they have to work together. You can’t build a high impact enterprise mobile app without access to you know customer data or product data or whatever and that is not going to come from the high-speed place. It’s going to come from the other place, and so they have to work together. So I don’t like the idea of the sense that it’s split or its bi or its two speeds. I think you know it makes sense in concept but they have to work together. You have to figure out the operating model to make them work together because you don’t want to create – you have to be very careful about creating the have and the haves not inside of IT.

Michael:

(44:03) That’s a very real problem that the notion that you can create two groups of IT, as you said the have and the haves not within IT, and as you said they are one team that you are trying to achieve a common goal.

(44:18) Now Chris, we’re just about out of time, but before we go based on your experience, and based on your research and your data, what advice do you have to organizations who want to undertake digital, and obviously of course want to do it successfully. What have you learned and what can you share?

Chris:

(44:41) I guess maybe one thing that pops to mind which I remember back to a insurance client of mine, who is undertaking a large transformation, remaking their aged interfaces, their customer interfaces, all of their back office systems regarding and related to their claims processing, bills, policies, proposals and so on, the whole shooting match.

(45:15) I think back to one of the more impactful meetings that I attended with the CEO and the leadership team there, where we showed them a demo, a concept demo for what part of this future could look like. And the CEO was blown away because it gave him a chance to finally sort of visualize what all these ideas, and conversations, and PowerPoint decks and meetings all meant.

(45:50) So you know, I guess what I would say is my one piece of advice to bring a lot of these points together is build a vision that is articulated in tangible stuff. Build a vision that you can start to communicate using demos and prototypes, and videos.

(46:14) We have some interesting videos on our digital services website and it’s digital.pwc.com that are some examples of these, part of the possible videos that help to set a vision for what’s possible in the context of employees and customers and what people do day in and day out. And it really helps to bring life in what the digital future could look like through a transformation. So on that what I would say is use some of these techniques, especially you know, eat your own cooking. If you are talking about digital transformation, use some of the digital assets like demos and prototypes, and videos and things that can help you bring life to the ideas.

(46:56) And they are very impactful and really can help to communicate in ways that you know might not have been able to communicate before.

Michael:

(47:06) So create context.

Chris:

(47:08) Yes, digital context.

Michael:

(47:10) Digital context, okay. Well unfortunately we are just about out of time and this has been a very fast 45 minutes. So thank you Chris Curran. We have been talking with Chris Curran, who is principal and chief technologist for PwC and who for years now has been running the digital IQ research, and this has been episode number 138 of CXOTalk. Chris, thank you so much for taking the time today.

Chris:

(47:44) Thanks for having me Michael.

Michael:

(47:46) And I hope we’ll do it again sometimes soon Chris. Everybody, I am Michael Krigsman, thank you for joining and please come again next time. And we’ll see you next week. We’ll be talking with Lee Congdon, who is the CIO of Red Hat next week, bye bye everybody.

Company’s mention in today’s show:

Chris Curran’s blog:      www.ciodashboard.com

Digital IQ Study:            www.pwc.com/digitaliq

Gartner:                          www.gartner.com

PWC:                               www.pwc.com

Standish Group:           www.standishgroup.com

Twitter:                           www.twitter.com