The effect of digital transformation on the CIO job
Digitization and digital transformation sound similar, but they couldn't be more different in what they demand from CIOs, explains Genpact's Sanjay Srivastava.
Sanjay Srivastava, chief digital strategist at IT services firm Genpact, met with TechTarget Industry Editor Linda Tucci on Zoom to talk about the state of digital transformation and the job of the CIO as enterprises enter a post-pandemic environment.
One of the lasting effects of the pandemic, he noted, is the move by enterprises from digitization to digital transformation. Business leaders now understand that technology isn't simply the means to automate existing ways of working, but the basis of new business models and a driver of new business value. With digital transformation, "the work itself changes," Srivastava said.
The enterprise's embrace of digital transformation has also changed the role of CIOs. "The world of the CIO now is becoming, if you will, less tech, tech, tech, and more about integrating technology, data, people, and process and orchestrating change across all four of those dimensions," Srivastava said. The chief engineers of enterprise IT now help pilot where businesses need to go.
Srivastava also talked about three big technical challenges facing the CIOs he works with: utilizing data to create business value, using technology as a disruptor, and taking a leadership role on environmental, social and governance (ESG).
The following transcript is edited for brevity and clarity.
We're coming out of a period where business, the IT organization, organizational roles, customer relations, you name it, were essentially reordered by a global pandemic. How do you see IT and the role of IT leaders as being different post-COVID than what they were pre-COVID?
Sanjay Srivastava: One of the biggest changes that I'm seeing coming out of it is the move from what I would call digitization to digital transformation. And it's super-interesting, because at first glance they kind of seem like a similar idea -- the words are close together -- but they couldn't be further apart in what's involved.
In many ways, digitization is about taking any process -- any end-to-end process – [and] breaking into its parts. You take every single part, you automate it, you digitize it, you make it faster. You make it better, you make it cheaper, you make it higher quality, and then you've digitized the process. But at the end of that, the process is just the same. It's just that it's faster, better, quicker, cheaper, if you will.
Digital transformation is an entirely different thing. It isn't just that -- it's about taking an end-to-end process and redesigning it, re-imagining what the value proposition needs to be, rethinking through the customer experience and delivery -- and therefore redesigning what that looks like end to end.
And once you have done that, you now have the ability to take these new capabilities, these emerging technologies -- things we didn't have 10 years ago when the original value chain was put into place, but we now do. And with the help of these capabilities, you're now able to redesign, reimagine and re-level the value proposition in a very different way, in a manner that -- once you're done with digital transformation -- the work itself changes. It isn't the same work.
And so, what we're finding is that this big transition is happening, and this is on the top of every CIO, every CEO, every board's mind that I interact with.
Roles also have to change to bring about digital transformation. Let's start with the CIO job.
Srivastava: If think about it, the CIO has always been a super-important role. I'd liken it [in the past] to the role of a flight engineer. You can't take off if the flight engineer is not on board; he or she serves a super-important purpose – it's mission critical, it's a lights-on operation. It's about delivering a really important capability: to keep the engine, the plane running, in this case, the enterprise running.
We're seeing a big change happen because with digital transformation -- and using technology to deliver a new business value proposition -- the world is now starting to center around digital. And the role of the CIO is changing because he or she's now more and more becoming the pilot or the co-pilot, helping colleagues and their stakeholders and the rest of the executive committee to really reimagine the business value proposition on the back of new technology. And so that's one big change that we're going through because the [CIO] seat at the table, the role of the individual, is completely changing.
I think another thing that's happening is that tech is no longer the long pole in the tent. And what I mean by that is when you do digital transformation, it isn't just the tech, it's the data. You have to harvest it, light it up and use the data meaningfully, and that's a whole other sort of ball of wax, if you will. Then there is the piece about people, operating model, resourcing, skilling, cross-training. And then there's the bit about the process because, as I said earlier, the process changes. The way you do digital transformation is you have to rethink what that looks like, what the operating model looks like, et cetera.
And so, the world of the CIO now is becoming, if you will, less tech, tech, tech, and more about integrating technology, data, people, and process and bringing orchestration across all four of those dimensions. That then puts the CIO in a very different position and, as a result, you require a very different set of skills. You have to have a very different approach.
You have to be an outsider to be able to bring in emerging technologies and [new] ideas and be able to tap into the venture community, and new research and development, et cetera. And yet you have to be an insider, because these are fundamental grounds-up transformations, large complex changes that we're trying to drive. So, you need stakeholder buy-in. You need the participation of all your counterparts.
So the role is changing, the profile is changing, the skill sets that are required are changing, the way you approach the job is changing, and who you work with is changing -- so tremendous change happening on every single dimension of that CIO role.
You work with a range of IT leaders, including CIOs and CTOs to chief digital officers and chief data officers. What are their biggest technical challenges?
Srivastava: I'll give you the top three. Probably the first one -- and bear in mind [that] when I talk about CIOs and other IT leaders I'm talking about large corporations, so mostly Fortune 500 companies. In where we are today in digital transformation, data is the largest driver of transformative value today.
And so, most of these large corporations are really focused on 'How do you put in a data fabric? How do you light up the dark data?' And by that, I mean, things that are sitting in unstructured files and PDFs and other things. You have to extract it, classify it, put it into a structured format, so you can actually apply both analytics as well as analytical statistics, machine learning and other AI capabilities.
So that's a big area of focus and, and there's a tech side of it. What's the right big data fabric? How do you do the integrations? How do you do the data management and the data engineering, and how do you keep your master data? And there's the governance side of it. You have a set of data at the core, there's a set at the edge in some cases. Does it make economic sense to bring everything into the core, or should it be dispersed -- and who controls it? What is your role with data? Do you produce the data? Do you transmit the data? Do you use the data or are you a custodian of the data? And then, associated with the data, what are the rules? What are the regulations? How do I make sure that I'm doing the right thing by the company and work through the privacy and ethics component of data? And, data, partly because it is driving so much value, is high on every board's mind.
I think another thing that is super high on tech leaders' minds is 'How do you use technology as a disruptor?' The job's not about keeping the lights on, the job's not about maintaining the status quo. The job's not about preventing something bad from happening. The job is about being on the offensive. It's about, as I said earlier, reimagining the value proposition. And so, there's a lot of focus now on thinking through what new technologies are coming through that are going to change the world around us. How do I start incubating, investing, experimenting, inventing around that?
I think there are three technologies that are high on people's minds. AI is one of them. The metaverse is another -- about combining it with AR/VR and using that to reinvent how value gets delivered, how customer satisfaction gets achieved and how stickiness is brought into the customer experience. And the other one that's super high on people's minds is NFTs, using NFTs to connect the virtual world with the physical world. Many of the CTOs and CIOs I work with are really looking at how it's evolving. We're all learning through it. We're each making a few mistakes.
So, [in the list of disruptive technologies] AI is No. 1 -- and it is more here than the other two. Metaverse is No. 2 and NFTs are No. 3.
You've talked about utilizing data as one of the top three technical challenges for CIOs. Using technology to disrupt the status quo is another. What's the third?
Srivastava: ESG is super important -- across all of its different parameters. What's been happening in the past is [that] the CIO has been on the receiving end [of ESG projects] -- 'Hey, can you go figure out what our carbon footprint is?' The CIO is running around trying to get a mapping done and someone comes around and says 'What about diversity and inclusion? How do we baseline where we are? How do we set the right metrics for ourselves?'
I think what's happening now is that CIOs are changing into a different gear, because the way to unlock value in ESG is through tech and data. It really is through tech and data. And through change management. But most CIOs are, if not the best, one of the most qualified people in an executive team to drive large-scale change.
What I'm finding is that when it comes to carbon density, for example, or calculating a carbon footprint or setting up goals and measures, CIOs are now stepping up and instead of just reacting to requests are saying, 'Let's define the framework.' I see so many of my colleagues, my friends and people I work with stepping up outside of the traditional CIO job and taking a position on ESG.
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