Eight Key Business and Technology New Year's Resolutions
The year of 2015 represents a case study in how consumer buying practices are changing, based upon their holiday shopping purchase patterns. Consumers in material numbers are choosing technology-enabled online purchasing and fulfillment using web-based technology. The quantitative evidence is clear: shopping malls are emptier, and distribution fulfillment organizations are finding their delivery capabilities stretched to the limit and then some. Consumers have further demonstrated a preference for a digital, omni-channel, behavior-based, predictive total sales and fulfillment experience. The message is loud and clear, with an exclamation point: organizations will require top-to-bottom IT and organizational transformation to remain relevant.
Newer organizations, which are not encumbered with multiple regulatory body audits, legacy systems, etc., have a competitive advantage as they can enable digital distribution quite quickly. However, for established organizations, which are heavily regulated and burdened with large legacy systems environments, the transformation may require a multi-year journey.
Regardless of an organization's current state, I believe there are key organizational and solution delivery New Year's Resolutions which will have a positive impact in the coming year.
1. Create integrated teams including both IT and business stakeholders.
In virtually all organizations, the potential synergistic value associated with an integrated IT and business configuration has not been realized. As we are now seeing technology transformation occurring at a far faster pace than in the past, optimizing the technology delivery process is a critical objective for the coming year.
IT organizations, and the businesses they support, need to be integrated within the overall technology enablement process, sharing equal accountability for solution delivery. The long-held view that IT development activities represent a "black box" at the margins of the business needs to be abandoned. Having had the opportunity to participate as thought leaders at Fortune 1000 senior executive events, we have observed that this virtual wall between IT and the business remains a matter of great concern at the highest executive levels. To this day, Gartner still often reports 50% or higher IT solution delivery failure rates.
The guiding principle that generates synergistic value is for IT to recognize and understand the relevance of the business purpose, and for business stakeholders to engage and partner with IT, throughout the software life cycle. Starting from the point of solution scoping, interaction between the integrated team results in the optimal solution delivery plan, which maximizes business value while minimizing IT delivery risk. Throughout the solution design, the integrated team members collaborate in a manner that limits the risk of a key functionality component being missed and allows the solution design to be driven by how business users will interact with the technology. In parallel with solution construction, the business can be developing their associated test plans in a more relevant and efficient manner having greater insight as to how the solution will function. Finally, while in the testing phase, business users and developers commence this process with a shared view as to how each solution component should function, such that when defects are found, collaborative defect resolution and retesting can occur to expedite solution delivery.
2. CEO and Board-level engagement is essential.
No longer can technology enablement be a secondary priority for this top leadership group. A change in visibility and involvement is necessary, as the future of an organization's competitive differentiation will be tied to technology enablement. In the coming year, a greater number of strategic directives from top management need to occur which are enabled through leading-edge technologies. As such, this group must have visibility into, and be presented with, strategic technology investments which enable expedited differentiated technology solutions, so that their organization may remain competitive in the emergent digital distribution purchase and fulfillment channel.
3. Avoid legacy system modification.
Unexpected solution delivery complications while modifying poorly documented legacy systems are well known, and as such do not require further discussion. The key guiding principle is to maximize alternatives to modifying legacy systems. Ideally, a common legacy interface should be developed in a manner which enables satellite system development. Purpose-built software package solutions should be implemented in such a way that needed data can extracted through the common interface while at the same time being able to pass back updates into the legacy systems, such that they remain the patent system of record. This allows for development resources to expend the preponderance of their time enabling organizationally differentiated solutions, leveraging a stable legacy systems environment.
4. CIOs must rethink longstanding priorities.
CIOs have often focused on maintaining single hardware solution vendors and standardized development languages, while also having as a priority conversion from legacy system architectures to new core system enabling technologies. These traditional priorities are more tactical than strategic. Going forward, CIOs must change their mindset to be strategically focused. An acceptance of overall architecture fragmentation allows expedited delivery of solutions strategic to the business. CIOs should be empowered to reconfigure their internal IT organization to enable an optimal strategic delivery model while embracing the integration of the business into the overall solution delivery process, as discussed in Resolution #1 above.
5. Focus on security.
Security and more security is a top-of-mind issue for consumers, auditors and regulators alike. The year we are about to bid farewell to has been one of unparalleled reporting of highly skilled individuals breaching top government security and large corporate databases. In addition, security technology providers are maximizing their opportunistic visibility, through broad-based advertising campaigns, presenting worst-case security breach scenarios to organizations and individuals.
As the new year commences, traditional user ID- and password-based security will soon be viewed as deficient; an additional security barrier will be essential to maintain consumer confidence. Initially, the addition of a personal question which is stored in a segregated database can be added to the sign-on process; however, this represents a temporary Band-Aid. The patent security paradigm emerging during the coming year will be biometric authentication, based on fingerprint matching.
Fingerprint user authentication has already been implemented on a limited basis. To the extent possible, mitigate investment and user acceptance risk by waiting as long as reasonably possible to implement biometric authentication. The full financial and organizational impact of using this technology is still emerging. In addition, consumer acceptance of this type of personal authentication has yet to be fully evaluated. What I am suggesting is that, rather than being a trailblazer into biometric user authentication, let other large organizations take the lead in implementing this security technology. Being a follower, rather than a leader, into new technologies like biometrics allows for greater insights into ease of implementation, best practices and consumer acceptance challenges—not to mention lower costs. This additional data will provide a basis for a more informed technology purchase, implementation and consumer change management strategy a little ways down the road.
6. Data, data and more data.
For any consumer-driven organization, consumer data retention has to be a top priority in the coming year. The key driver behind any behavior and associated predictive analytics is data. Organizations need to establish their unique data-enablement strategy. This is due to a host of factors which vary by organization but include: current data retention which is extractable, specific data variables available, length of data retention and quality of data retained. Often the available organizational data has to be supplemented though the purchase of consumer-specific data from third-party data sources. The hiring of a data scientist is essential to participate in what data is mined from existing systems, which then forms a basis from which supplementary data requirements can be established. The final outcome from these activities is an initial analytical database.
In order to mine relevant behavioral and predictive data, the purchase of a purpose-built solution will likely be required. Big Data solutions, while providing an analytical framework and associated analytical tools, have a dependency related to what baseline data can be extracted from the organization.
Even if data analytics does not currently seem relevant to an organization, in the coming year, enabling the retention of the maximum amount of consumer-related data is critical. This non-specific data retention strategy is required due to the fact that behavioral and predictive analytics represent an art rather than a science. The key data elements which enable behavioral and predictive analytics only become clear when the data scientists perform their data modeling against a baseline data set. Thus data retention, prior to a potential future need, remains essential, as the value generated from behavioral and predictive analytics is directly tied to the breadth and depth of available data.
7. Manage the organization's social media presence.
Facebook, Twitter, LinkedIn, Yelp!, TripAdvisor, etc.—if your organization has had these on the back burner, now is the time to take control. IT, along with the business, needs to establish standards for what is developed, how it is used, and how it is monitored. Most organizations will take both an offensive as well as a defensive posture. This means for most organizations, social media will be a key branding and marketing tool, while at the same time primary social media feeds must be constantly monitored for negative postings. At a bare minimum, a defensive monitoring capability is essential in the coming year. Most consumer-driven organizations have potential failure points in their sales fulfillment and distribution life cycle. Real-time monitoring of social media provides the opportunity for the organization to react immediately to perceived and/or actual consumer fulfillment failure points before the postings have the opportunity to "go viral." As social media has no truth sensor, all negative postings must be taken seriously, whether or not they are true.
8. Embrace The Cloud.
As we enter the coming year, there is hardly a single computing user who has not stored data and or applications in The Cloud, and or used The Cloud as a single point of technology solution access. Organizations are now accountable to keep these consumers' data safe and secure, while at the same time enabling The Cloud to work as expected. The new year will also likely see the broad-based use of purpose-specific Clouds—for example, there may be Clouds for car vendors, recruiting firms, banks, specialized retail providers, etc., where head-to-head competition occurs. CIOs we have spoken with are not particularly worried about further Cloud physical implementation, but rather are focused on how best to enable security for their Cloud-based usage. Indeed, CIOs are likely going to have to incrementally increase Cloud security, using updated security technology paradigms.
The number and magnitude of these proposed transformational New Year's Resolutions represent a significant undertaking. However, in consideration of faster technology advancement, growing consumer reliance on a significantly differentiated digital experience, burgeoning security threats and competition from new, more agile, legacy-free organizational startups, these matters must be addressed.
Some of the suggested resolutions involve organizational transformation—the starting point for enabling change in the coming year. The only way a consumer-facing organization will remain relevant in this new, fast-paced, technology-driven environment is through organizational reinvention, whereby established paradigms are replaced via an optimized top-to-bottom organizational reconfiguration. As discussed above, technology is at least as relevant to organizational success as any other business drivers, and technical management deserves a seat at the table.
Established consumers recognize an organization's differentiated value proposition which is relevant to them, otherwise they would never have established the business relationship in the first place. These consumers, as long as they see demonstrable evidence of the transformation of their individual sales fulfillment and distribution experience, are likely to accept a slower pace of transformation than other competing organizations might be able to provide. Thus, an organization's emphasis should reflect high quality, maximum consumer value-add, step-by-step transformation, versus focusing on the maximum breadth of organizational transformation while sacrificing quality.