IT Leaders / CIOs should be master these Business Concepts
IT Leaders always speaking and collaborating with Business Leaders, there are some Business Concepts where CIOs who talks about Technology, also should understand and gain knowledge for critical Business Concepts. Let’s see some essential terms we will discuss here.
Value of Technology is extremely critical for any CIOs for their communication with Business on Digital Business Transformation Initiatives to follow Business leaders and Board of Directors in Business Language to explain better tech strategies and planning.
Nobody interested in and talks about Technologies in Business how to communicate with Board Members. In this situation, CIOs should learn to understand conversations in Business concepts to help them deliver, iterate on, and measure the efforts in operations and the customer experience. These are the core business concepts where CIOs / IT Leaders should be focused on:
- IT Leaders / CIOs should be master these Business Concepts
- Business KPI
- Profit & Loss Statement
- Customer Focus on Top Priority
- Adaptability as Lean Startup
- Cash Flow
- Balance Sheet
- Marketing and Sales
- Corporate Culture and Cross-functional Teams
- Emotional Intelligence
- Employee Engagement
- NDA – Non-disclosure agreement
- Build IT Governance Model to support the Business
As companies create new business models anchored in digital technologies, it behooves IT organizations to track digital business KPIs, which come in two types.
The first set assesses the progress in digitalizing the current business model, spanning sales, marketing operations, supply chain, products and services and customer service. A second set of KPIs assesses the progress and opportunity of net-new revenue sources created by pursuing new digital business models and are clearly differentiated from nondigital sources.
It’s one thing to create KPIs, but another to discuss them. CIOs must be able to explain to their C-suite peers and boards what these digital KPIs measures and why they matter to the business.
Profit & Loss Statement
A financial statement that shows a unit’s revenue, with line items showing each expense, with a result of how much money was earned or lost in a certain period.
CIOs should start focusing to understand with Business Leaders on financial statements specially Profit & Loss Statement to know more about the organization performance where profits and where are the losses, so that what are the strategies required to be focused on to improve the profit and generate revenue for the organization.
CIOs / IT Leaders will have the clear understanding what are the areas they need to improve in terms of IT and which areas from the Business where IT can help to business to improve and it will be possible only if IT Leaders understand this very important statement focused on Profit and Loss for the organization.
Customer Focus on Top Priority
Many companies will be forced to manage a significant reduction in revenue. CIOs need to help support revenue generation for the organization. Depending on the industry and position on crisis quadrant, most organizations are facing an impact on revenue. The customer journey map is something CIOs can no longer ignore, as more companies leverage technology to create new customer experiences.
CIOs should focus on supporting existing customers and constituents as a top priority.
Support business processes that need to become remote and less dependent on travel or in-person visits. Prioritize new digital processes that enable the company to continue to deliver and sell where possible.
Technology innovation delivered quickly will absolutely impact market winners and losers across all industries. Now is the time to consider technology-enabled innovation.
Most organizations expect to manage a drop in revenue and demand. CIOs should focus on understanding how the CEO & chief revenue office need support. Understand the corporate strategy: Attack, Thrive, or just Survive.
Adaptability as Lean Startup
It’s one thing to run scrums and deliver software in agile. CIOs should also learn how to operate in “lean startup” mode, which involves iterative testing, learning, and improving on their product, Failure is expected as companies move fast, break things and iterate.
Lean startup mode is really about operating a “business model alongside a product or solution,” and “moving from experiments to insights really fast, how emerging technologies facilitate new business models and ventures. The key to operating in lean startup mode is pairing technology with a business model in parallel.
Money that comes in to, and goes out of, a company. Cash inflow can be from sales, sales of equity, debt, and other sources. The effect of cash flow is real, immediate and, if mismanaged, unforgiving. The key is to know how to monitor, protect, control, and put cash to work.
Cash Flow is particularly important to understand by IT Leaders / CIOs because Cash always the King for any organization. If CIOs will understand the important of Cash flow, they will make the IT Strategies, will be focused on Cash Flow.
All contracts related to IT should be renegotiated to follow the win-win approach to control the Cash Flow.
CIOs should start to review the IT expenses how they can control without impacting the Quality of IT Services and Business Impacts as well as discuss with Business Leaders what are the possibilities where expenses can be controlled specially where IT can support to them.
A financial statement that shows a snapshot view of assets (what we own), liabilities (what we owe), and equity (who owns what).
Potentially an ultimate bridge builder between tech and business leaders, the data balance sheet provides an overview of data the organization holds; how it is used, including the information flows related to the organization’s operations; and the risk management procedures related to data.
Ideally, a well-appointed data balance sheet will help you and your organization harvest data and turn it into business value, while taking care to acknowledge the potential liabilities in using certain types of data. Regardless of what language they elect to use, IT leaders “must be able to put the vision into their own words so it is meaningful and relevant.
Marketing and Sales
Refers to the sales team, salespeople, tactics, strategies, and anything directly involved in closing the deal to generate revenue. Less on research, more on signing customers and contracts.
“Promoting and selling products or services” (your offering); “means of communication between company and audience.” Includes research (statistics), advertising, PR, branding, strategies.
CIOs and IT Leaders should understand and get the insights how IT Strategy and Plans can help to Marketing and Sales Teams to generate more revenues. Which Enterprize Software and Applications need to be implemented efficiently and this is possible only if IT Leaders have good understand of Marketing and Sales aligned with Business Leaders.
Corporate Culture and Cross-functional Teams
The DNA of the company, consisting of the values, belief systems, and how people think and act. Sometimes hard to describe, sometimes intentional, always impactful at many levels. CIOs should be master to understand the corporate culture in any organization because all IT related Projects and Changes are depending on the Corporate culture.
A team consisting of people from different business functions. For example, a team made up of accountants, developers, sales, marketing, and operations.
All IT Leaders and CIOs always the most important priority should be to master the techniques of how they can align with Cross-Functional Teams in Corporate culture. If IT Leaders will understand and follow this approach, they will be able to implement IT Changes and projects efficiently.
Ability and skills to work and deal with others and manage your own emotions. Often used to describe how someone would interact with a team, prospects, or customers. Peoples are human being and should be taken care with humanity to develop the high-performance teams.
CIOs and IT Leaders should understand this fact to deal with IT employees as well as with business employees. Always should understand emotionally what the challenges and problems are they facing and how with the help of Technology that can be resolved by Information Technology.
What are the processes and hardware need to be optimized? so, if IT Leaders / CIOs will be able mange employees with emotional intelligence, they will earn the trust and respect for IT and IT will be trusted Business Partner.
Usually a goal of HR, to create a strong relationship between the company and the employee. A positively engaged employee could be more productive and bought-in to vision and strategy.
But at the same time IT Leaders or CIOs should understand the fact of engagement with cross-functional teams to be more effective to provide IT services. IT Leaders should align always with HR Teams to make sure how effectively they can implement IT services specially when pandemic situation like COVID-19 peoples need to work from home (WFH) most of the times. Employee Engagement sure will help to IT Teams to be effective.
NDA – Non-disclosure agreement
NDA which means everything’s confidential. Typically, VCs don’t sign these but in the corporate office, they are common to sign. You don’t have to sign, though, you have a choice.
Before we continue to the next confidential project or change in any organization, everyone needs to sign an NDA following many corporate policies. This is not only applicable for Business but applicable also for IT Leaders because they have organization confidential data and information on various levels. This is important also following the Information Security Policies to protect the company confidentiality.
So, CIOs should communicate this concept within IT Teams clearly to avoid any type of confusion and confidential issues later in IT Projects and changes.
Build IT Governance Model to support the Business
Keeping IT employees productive, enabled, and engaged is job #1 Failure to prepare will impact the entire organization. CIOs need to create an emergency IT Governance Committe. Governance models are effective at providing oversight during normal operating times; however, they often crumble under speed or economic pressure.
Support your team, keep them safe, and build a back-up plan for key roles. The stage of initial crisis management and communication has passed. Establish clear roles and responsibilities across IT to help the organization respond rapidly.
Communication and re-training on WFH and remote working technology is critical. Assume that previous IT training wasn’t a priority, and everyone needs a refresher on all remote technology and any change they need to manage through. Don’t begrudge the time. The re-training investment will pay dividends.
When building IT Governance Model, IT Teams should understand these concepts clearly to be aligned and understand the business priorities in normal and pandemic situations when IT needs to support from Home (WFH)
CIOs for any organization to be successfully in thier roles, should be master of key business concepts. Always keep trying to find out what are the business concepts they can understand and learn to work effectively with business leaders. If CIOs will understand the business, they can support to business effectively understanding the business challenges and issues following the corporate vision and mission.
Understanding the business concepts effectively, IT Leaders will be able to build IT Organizational Model aligning with Business strategies for long time specially in this Digital Transformation Age.
So, at the end of this article, I would like to ask you what is your feedback, what you would like to add and what you want to improve further?