Businesses get the most bang from their technology investments through well-executed strategies that combine innovation and customer focus. But how do they do it? These examples illustrate the myriad ways business and technology leaders are using the cloud, integrated software, and engineered systems to navigate major market trends with agility and success.
A recent Forbes column argues convincingly that customer experience (CX) is today's most important business benchmark.
According to research from Temkin Group, even modest improvements in CX can return big results—a billion-dollar company could net close to an extra $370 million over three years.
And managers are taking note of the impact CX can have on the bottom line. "We monitor every phase of a customer's interaction with Marriott and work to create the best experience every step of the way," says Marriott Global Chief Information Officer Bruce Hoffmeister in Marriott's Digital Hospitality.
CIOs have traditionally been the stewards of enterprise IT, with responsibilities that start at the data center and extend to business and customer applications. But the digital disruption brought on by social and mobile technologies, as well as the big data and enterprise cloud, is forcing CIOs to adapt and transform their role, according to CIO Insight.
The focus now is on integrating and using these technologies to solve business issues. As business challenges and opportunities arise, the CIO will increasingly be the one managing data quality across divergent systems to reach business goals and deliver a complete view of customers and business operations. “That's the new role of the CIO—ensuring that the data is correct, is managed properly, has the right quality, and drives analytical thinking that improves the business,” says Tom Fisher, CIO of Oracle Cloud Services.
From smart energy meters to smart health monitors, smart cars to smart appliances, internet-connected devices provide a huge opportunity for business leaders to help differentiate their organizations. But there's a potential for backlash. One KPMG study in the United Kingdom showed that 70 percent of United Kingdom consumers "fear the increase in the number of interconnected everyday devices make it too easy for things to go wrong," Computer Weekly reported. And according to a Ponemon Institute study, risks of a data breach in the cloud are multiplying because of increased dependency on cloud services and the proliferation of devices with access to cloud resources.
While customer fears are not unfounded (just look at the news to see why), businesses shouldn't stop moving forward. Executives need to make proper data governance and security practices part of the go-to-market strategy, rather than an afterthought. "Security needs to be about something more than tactics. It has to be a cultural mindset," said Mary Ann Davidson, chief security officer at Oracle. "That should be expressed at the beginning of any IT project—before we start designing a system architecture, we need to discuss plans to secure the technology."
As many as 50 billion devices may be connected to the internet by 2020, according to a white paper by Cisco's Internet Business Solutions Group. And analysis from EE Times following the 2104 Mobile World Congress in Barcelona found that many of the executives in attendance thought that number to be conservative.
But for machine-to-machine systems to reach their full potential, enterprises must address several challenges. "Open standards are needed to allow new players to create and design services, applications, and new devices," EE Times reported. "In addition, regulators must address the security and privacy implications of the IoT to ensure data collection is handled properly."
In 2012 Forrester predicted that the cloud would move out of the shadows and become a mainstream technology. That is now happening...fast. By 2017, spending on cloud computing is expected to grow five times faster than overall IT spending. But keeping pace with the cloud means facing myriad architectural challenges—from simplifying existing infrastructure to integrating with a variety of public and private cloud systems.
"Increasingly, we've gone from a world where siloed systems made the highest profit to a world in which the best business strategies in many industries are ones that are interconnected," says John Palfrey, author of Interop: The Promise and Perils of Highly Interconnected Systems.
A 2013 PwC study on the next-generation workforce found that 64 percent of millennial workers (born between 1981 and 1996 and expected to make up 75 percent of the workforce by 2030) would like to occasionally work from home, and 66 percent would like to shift their work hours.
The proliferation of mobile technologies is making that possible: Gartner reports that by 2016, more than 30 percent of "bring your own device"(BYOD) strategies will leverage personal applications, data, and social connections for enterprise purposes.
"The next generation wants to work this way naturally," says Jody Thompson, author of Why Managing Sucks and How to Fix It. "They're entering an old-fashioned, twentieth-century system, and what we're telling them doesn't fit with how they think and how they move stuff along."
In his book Accelerate: Building Strategic Agility for a Faster-Moving World, Harvard Business School professor John P. Kotter notes critical metrics that define the speed of our current economy—the steady growth of patent applications over the past 50 years, the rapid increase in the numbers of shares traded on the New York Stock Exchange, and the explosion of data stored on hard drives around the world.
With markets moving so fast, demands on senior executives to make timely decisions are also increasing—while tolerance for error is growing ever smaller.
"CEOs these days are given one term in office," said John Challenger, chief executive officer of Challenger, Gray & Christmas, told Newsweek in 2013. "If they're very successful, they might get four more years."
Natural disaster. Political instability. Regulatory changes. Perishable goods. The world is a complicated place and volatility (in its many forms) can wreak havoc on increasingly global supply chains—threatening inventory, driving up unit cost, and cutting into margins.
"What's the risk if your supplier goes out of business? If the barge carrying your components sinks? You have to be aware of geophysical, as well as local, political risk to your supply chain," says Tony Perrigan, Oracle's group vice president, Enterprise ERP Applications Group.
Research shows that leading organizations are looking for ways to mitigate risk by taking a broader view of the supply chain. As Gartner puts it, "Today, supply chain teams design to improve time to market for new products, harvest opportunities through tax efficiency, meet corporate sustainability goals, balance risk with opportunity, and manage product complexity."
According to the 2013 Talent Shortage Survey from the ManpowerGroup, 54 percent of executives reported that talent shortages are having a high or medium impact on their ability to serve clients.
Despite this talent shortfall, PwC's 17th Annual Global CEO Survey found that 62 percent of US CEOs expect to hire more people in 2014. That leaves human resources executives stuck between market forces and executive demands.
"How does the CHRO translate the demands of senior management into an actual revenue-driving plan? It requires creative thinking and a fundamental change in HR activities," says Bertrand Dussert, vice president, HCM Transformation and Thought Leadership for Oracle.