All things Digital and your Digital Strategy
With the growth of all things Digital I took a closer look at some of our research and wanted to share my take on where Digital is going.
Key areas to look at first!
- Do you have a Digital strategy?
- The Pace of digital disruption
- Digital Disruption
- Monetising your Digital strategy
- Skills - Are you looking at the right skills for your problems!
Across the three years that we have tracked digital influence, the dynamics have been shifting. This year, shared ownership between IT and marketing seems to be the most favoured approach, suggesting increasing levels of collaboration are developing. I go into this further below -
- CIOs rate their team's digital capability highest when aligned with traditional IT components
- Challenges to successful digital strategy more weighted to culture than IT capability
- Digital components that provide agility and new customer engagement rated highest 25% of organisations surveyed have a digital strategy that extends enterprise wide. Given that 62% of CIOs expect disruption in the next two years, the data suggests not all organisations are prepared for digital disruption.
Who should shape your Digital Strategy?
Chief Digital Officer (CDO), Chief Marketing Officer, CIO, MD or the Board?It appears from the research that a collaborative approach is best; the CMO shapes the goals of the strategy with the CIO and the IT team building the infrastructure and tools to support it
The Growth of the CDO but what influence do they have?
20% now have engaged with a Chief Digital Officer (CDO). Surprisingly, when a CDO is in place, the top digital officer is not involved in shaping the digital strategy in 14 per cent of organisations, and they are involved only 'a little' in 8% of cases.
CDO's contribute 'a lot' - but are not in the lead - in developing digital strategy 31% of the time, and they lead the shaping/executing in less than half (47%) of organisations where they are present.
These mixed messages suggest that the CDO role, still in its infancy, is evolving in its positioning in organisations - possibly much like the CIO role did two decades ago.
This year, there is some evidence of a 'boomerang' effect, whereby IT organisations gradually become more involved over time. The proportion of CIOs claiming exclusive ownership of digital is up 8 % from last year, while CIOs who 'share' the digital function is up 7 %. Conversely, ownership of digital by Marketing is down from 40% last year to 24% today - a major drop of 16%.
Digital success and challenges
Over half of CIOs believe the most important component of successful digital activity is having an IT infrastructure that allows greater innovation/agility, alongside using digital to create new revenue streams and using mobile platforms to engage with customers. While many organisations are keen to implement exciting new digital solutions, CIOs know that they need to have a solid foundation that is robust and secure.
For a third of CIOs a lack of vision is the biggest challenge they face when responding to digital disruption, followed by a lack of funding and a lack of critical skills / poor understanding of digital impact. These figures are probably not surprising as the landscape in this area is changing very rapidly.
Digital Disruption and the Pace of Digital Disruption
- CIOs report significant shift in digital control away from Marketing
- The pace of disruption varies considerably across sector
Unsurprisingly, industries most affected already by digital include broadcast media and advertising. These types of organisations are probably first-movers because of their consumer-facing nature and the relative ease by which technology can shift the consumption of media.
In what has traditionally been a sector that embraces the disruptive nature of technology, it is interesting to note that only 30% of CIOs in the financial services sector currently operate with disruptive digital technologies. But if you look at this on a case by case basis its not a surprising stat. Companies like Currency Fair, Realex Payments, Stripe have all come in and taken an easy of the market. In my mind and as a user you will use what is right and that is easiest to use, and if you get a nice discount brilliant why wouldn't you!
The next 2-5 years will be a constant changing of where Digital is going, 30% expect digital disruption to occur throughout, look at Smartphone usage, over 100 billion google searches are done through devices, I know I bank mainly through my IPHONE, I do my fantasy football through my APP etc. so what's next?
Virtual Reality banking, imagine putting on your headset and thinking you were in a Bank while on an App, or sitting in a Dugout while playing fantasy football, the thought process is endless! But again can companies adapt to these changes in our demands, wants and needs?
There are so many reports out on where skills are and what is needed! I don't want to rehash what has been said but the main point I want to say is that Hire the people you want and not the people you think you need. For example, if you want a UX designer hire a UX designer not a UX designer who can do everything you think you will need down the line. I know this maybe short sited but you can train people to do what is needed over time but if you have a need to be filled then get this skill set rather than predict what will be needed if you get past phase 1. You may disagree but from talking to people who can't find a skill set, because they don't have something that will occur down the road is more of a headache.
Digital is expanding so why not hire for now and see what is needed and invest in the person.
In summary around Digital and Digital Disruption Only 10% of CIO's believe their organisation will be unaffected by digital disruption or will lose little/no market share if they do not embrace digital technologies. Imagine if you had asked this question to a travel Agent 10 years ago, they probably would have said the same thing! So it's great to see that a larger proportion of CIOs, 47%, believe the impact of not embracing digital disruption will be 'great' and their organisation will lose significant market share if it falls behind competitors in using digital technologies
Personally from talking to organisations and clients who are actively embarking on developing a digital strategy, I have found that clients are frequently focused only on customer facing channels and negating the need to look wider.
With the growth of Data and the ease to obtain Data, organisations need to focus on what is driving the digital change and ensure they are focused on the right areas rather than spending money on areas that won't give return on investment.
There appears to be a high level of confidence among CIOs we speak to that will be able to manage the effects of digital disruption but who knows what the next year will bring!
Gavin Fox is an Associate Director at Harvey Nash Ireland and Head of Practice for Harvey Nash Technology. Over the past nine years he has become a critical member of the Harvey Nash Ireland team, contributing to the company's strategic outlook, developing its Technology and Recruitment Solutions business and ensuring client expectations are exceeded.