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CIO Journal
CIO Insights and Analysis from Deloitte
CONTENT FROM OUR SPONSOR Please note: The Wall Street Journal News Department was not involved in the creation of the content below.

More Deloitte Insights Articles

As invention and innovation accelerate exponentially, the world is arguably moving toward a future in which technology helps to make the impossible possible. The extent of this upcoming transformation emphasizes the need for leaders who can monitor and help minimize the potential for a growing divide between haves and have-nots.
As invention and innovation accelerate exponentially, the world is arguably moving toward a future in which technology helps to make the impossible possible. The extent of this upcoming transformation emphasizes the need for leaders who can monitor and help minimize the potential for a growing divide between haves and have-nots.
For CIOs, innovation used to mean improving IT and workforce efficiency. Today they’re expected to do all that and more. Enabling business disruption has become an important part of the CIO’s agenda, and it’s often a matter of forging ties with the right partners and ecosystems.
For CIOs, innovation used to mean improving IT and workforce efficiency. Today they’re expected to do all that and more. Enabling business disruption has become an important part of the CIO’s agenda, and it’s often a matter of forging ties with the right partners and ecosystems.
Exponential technologies, whose performance relative to cost and size is accelerating rapidly, increasingly enable organizations to promote positive social impact while also deriving business benefits. In this video, Deloitte Consulting LLP’s CTO discusses how using exponentials for social good can enhance a CIO’s legacy.
Exponential technologies, whose performance relative to cost and size is accelerating rapidly, increasingly enable organizations to promote positive social impact while also deriving business benefits. In this video, Deloitte Consulting LLP’s CTO discusses how using exponentials for social good can enhance a CIO’s legacy.
Emerging technologies and development approaches are supporting the creation of autonomic computing platforms—IT systems that can be self-configuring and self-optimizing. Enterprises are increasingly exploring autonomic platforms, determining how they can support a more responsive, agile, and efficient IT organization.
Emerging technologies and development approaches are supporting the creation of autonomic computing platforms—IT systems that can be self-configuring and self-optimizing. Enterprises are increasingly exploring autonomic platforms, determining how they can support a more responsive, agile, and efficient IT organization.
Tax departments are increasingly recognizing the value of tax portals. With applications built on existing collaboration platforms, tax portals can help tax departments struggling with the challenges of managing the many facets of tax operations, including tracking the status of regulatory obligations and managing workflow and documentation.
Tax departments are increasingly recognizing the value of tax portals. With applications built on existing collaboration platforms, tax portals can help tax departments struggling with the challenges of managing the many facets of tax operations, including tracking the status of regulatory obligations and managing workflow and documentation.
More organizations are building out their analytics capabilities and deriving meaningful insights through these efforts. Yet analytics managers in IT and the business frequently lament the difficulty of embedding these insights into the processes and systems they’re designed to support. Tom Davenport, senior advisor for Deloitte Analytics, offers guidance on how to overcome this persistent challenge to enhance the business value of analytics.
More organizations are building out their analytics capabilities and deriving meaningful insights through these efforts. Yet analytics managers in IT and the business frequently lament the difficulty of embedding these insights into the processes and systems they’re designed to support. Tom Davenport, senior advisor for Deloitte Analytics, offers guidance on how to overcome this persistent challenge to enhance the business value of analytics.
The Deloitte Center for Health Innovation weighs in on the innovations most likely to provide much-needed transformation in the health care industry, from immunotherapy, next-generation sequencing, and point-of-care diagnostics to convenient care, telehealth, and virtual reality.
The Deloitte Center for Health Innovation weighs in on the innovations most likely to provide much-needed transformation in the health care industry, from immunotherapy, next-generation sequencing, and point-of-care diagnostics to convenient care, telehealth, and virtual reality.
Commercial real estate owners are pioneering the application of IoT technology not simply to increase efficiency or cut costs, but also to develop the next generation of smart buildings modeled around their occupants’ needs. Other industries will want to watch this space for emerging best practices in the areas of integration, data management and analytics, and risk management.
Commercial real estate owners are pioneering the application of IoT technology not simply to increase efficiency or cut costs, but also to develop the next generation of smart buildings modeled around their occupants’ needs. Other industries will want to watch this space for emerging best practices in the areas of integration, data management and analytics, and risk management.
Harnessing exponential technologies for social impact can allow organizations to help address pressing societal issues, build new markets, and attract top talent and consumers. CIOs can help drive their companies’ exponentials initiatives for both philanthropic good and for more commercial purposes as well.
Harnessing exponential technologies for social impact can allow organizations to help address pressing societal issues, build new markets, and attract top talent and consumers. CIOs can help drive their companies’ exponentials initiatives for both philanthropic good and for more commercial purposes as well.
The chief information security officer (CISO) and the security organization can reside in one of several places in an organization, from IT and operations to legal and risk management. Wherever the CISO’s home, the CIO can help elevate the person and the function to the more strategic level of executive attention and organizational priority that today’s cyberthreats demand.
The chief information security officer (CISO) and the security organization can reside in one of several places in an organization, from IT and operations to legal and risk management. Wherever the CISO’s home, the CIO can help elevate the person and the function to the more strategic level of executive attention and organizational priority that today’s cyberthreats demand.
Autonomic computing platforms, which can self-manage and even self-heal without requiring human invention, could allow IT staffers to focus their energies on higher-value activities. In this video, Deloitte Digital’s CTO examines how autonomics can enable a more predictable and repeatable approach to managing IT environments.
Autonomic computing platforms, which can self-manage and even self-heal without requiring human invention, could allow IT staffers to focus their energies on higher-value activities. In this video, Deloitte Digital’s CTO examines how autonomics can enable a more predictable and repeatable approach to managing IT environments.
Collaborative research between the Partnership for New York City Innovation Council and Doblin, Deloitte’s innovation and design practice, debunks some widely held beliefs about what holds back startups and innovation activities in the city. Their findings are also applicable to CIOs charged with encouraging innovation in the enterprise.
Collaborative research between the Partnership for New York City Innovation Council and Doblin, Deloitte’s innovation and design practice, debunks some widely held beliefs about what holds back startups and innovation activities in the city. Their findings are also applicable to CIOs charged with encouraging innovation in the enterprise.
Today’s CIOs are evolving into strategic business partners driving digital transformation across their organizations. An IT executive recruiter shares 10 behaviors CIOs can develop to succeed in this new role, addressing such areas as stepping into the digital leadership void, turning IT consumers into co-investors, and adopting a product management mindset.
Today’s CIOs are evolving into strategic business partners driving digital transformation across their organizations. An IT executive recruiter shares 10 behaviors CIOs can develop to succeed in this new role, addressing such areas as stepping into the digital leadership void, turning IT consumers into co-investors, and adopting a product management mindset.
Intellectual property (IP) can comprise more than 80 percent of a company’s value. Prioritizing protection of these assets from cybertheft can help prevent extensive potential losses. The addition of cyberprotections at every stage in the IP life cycle is essential, as is the inclusion of IP cyber risk in the company’s overall enterprise risk management plans.
Intellectual property (IP) can comprise more than 80 percent of a company’s value. Prioritizing protection of these assets from cybertheft can help prevent extensive potential losses. The addition of cyberprotections at every stage in the IP life cycle is essential, as is the inclusion of IP cyber risk in the company’s overall enterprise risk management plans.
With analytics usage still disjointed and experimental in many companies, CIOs are poised to lead enterprisewide efforts to become more data- and insight-focused. The potential payoff for assuming the analytics leadership mantle is greater ROI on analytics investments and, perhaps more important, a sustainable insight-driven advantage in the marketplace.
With analytics usage still disjointed and experimental in many companies, CIOs are poised to lead enterprisewide efforts to become more data- and insight-focused. The potential payoff for assuming the analytics leadership mantle is greater ROI on analytics investments and, perhaps more important, a sustainable insight-driven advantage in the marketplace.
Blockchain has the potential to disrupt organizations by transforming the way institutional trust is established between parties in transactions. CIOs need to determine whether they expect to defend against this technology, or whether a business case exists for embracing it.
Blockchain has the potential to disrupt organizations by transforming the way institutional trust is established between parties in transactions. CIOs need to determine whether they expect to defend against this technology, or whether a business case exists for embracing it.
As of July, health care breaches constituted 34 percent of all reported cyber breaches, more than any other industry. With the growing digitization of all aspects of health care and an ever-present threat of cyberattacks, health care organizations are striving for cyber resilience, by which early detection, response, and recovery can mitigate potentially large damages to patients, operations, and reputation.
As of July, health care breaches constituted 34 percent of all reported cyber breaches, more than any other industry. With the growing digitization of all aspects of health care and an ever-present threat of cyberattacks, health care organizations are striving for cyber resilience, by which early detection, response, and recovery can mitigate potentially large damages to patients, operations, and reputation.
Organizations are transforming their legacy core systems to enable new business capabilities and spur future growth. The Texas Department of Motor Vehicles and PayPal offer potential paths for revitalizing these essential, yet often out-of-date, business systems.
Organizations are transforming their legacy core systems to enable new business capabilities and spur future growth. The Texas Department of Motor Vehicles and PayPal offer potential paths for revitalizing these essential, yet often out-of-date, business systems.
Traditionally, CIOs have turned to application management service (AMS) providers to maintain critical applications for a budget-friendly fee. But as IT organizations remake themselves to meet the demands of the digital age, CIOs can expect AMS providers to possess domain expertise, collaborate and innovate with their clients, and be accountable for delivering measurable results on high-priority transformation initiatives.
Traditionally, CIOs have turned to application management service (AMS) providers to maintain critical applications for a budget-friendly fee. But as IT organizations remake themselves to meet the demands of the digital age, CIOs can expect AMS providers to possess domain expertise, collaborate and innovate with their clients, and be accountable for delivering measurable results on high-priority transformation initiatives.
What happens to a technology startup’s pioneering, entrepreneurial culture once the startup is acquired by a larger company? Can urgency and speed survive in a huge corporation? SAP Ariba President Alex Atzberger shares insights on how once-independent startups can thrive under the wing of a big vendor.
What happens to a technology startup’s pioneering, entrepreneurial culture once the startup is acquired by a larger company? Can urgency and speed survive in a huge corporation? SAP Ariba President Alex Atzberger shares insights on how once-independent startups can thrive under the wing of a big vendor.

Disruptive Innovation Is a Group Exercise

Nearly half of CIOs surveyed said innovation capabilities are nonexistent or nascent in their organizations.
Nearly half of CIOs surveyed said innovation capabilities are nonexistent or nascent in their organizations.

Partners and ecosystems play an increasingly critical role in helping CIOs create lasting business value.

Innovation has long been a part of the CIO’s agenda, but that mandate has expanded considerably over the years. No longer limited to improving effectiveness or efficiency, today’s innovation imperative demands that CIOs help create new products and services, novel approaches to customer engagement, and even new business models.

As part of Deloitte’s 2017 Global CIO Survey, slated to be released Nov. 10, 58 percent of CIOs say “helping in business innovation” is a core expectation of the IT organization. CIOs also rank innovation among their organizations’ top five business priorities, on par with customer, performance, cost, and growth initiatives.

Whether they are equipped to deliver business innovation is another matter. In Deloitte’s CIO Program Transition Lab sessions, more than 100 CIOs were asked to assess their innovation capabilities. Nearly half said such capabilities are nonexistent or nascent in their organizations. Slightly more than a third are currently building innovation capabilities, while only 5 percent said they have “excellent” capabilities in place (see Figure 1).

Three Types of Innovation

So what needs to happen? It’s crucial to lay the foundation by developing maturity in three types of innovation. To foster the disruptive innovation that’s transforming industries large and small, CIOs can reach out to partners and ecosystems for help.

Incremental technology innovation. Traditionally, CIOs have focused on innovation within IT—finding ways to uncover efficiencies or develop innovative solutions to support back-end systems and processes. Examples include implementing technologies like the cloud, artificial intelligence, Internet Protocol version 6, solid-state drives, or virtualization.

Workforce-enabling innovation. Using technology to empower workers has been another item on the CIO’s innovation agenda. Mobile and social tools that can enhance productivity are one example; others include on-demand access to data and new learning tools. At JetBlue, for instance, Executive Vice President of Innovation and CIO Eash Sundaram and his team launched a proprietary satellite in Kazakhstan that provides free, fast Wi-Fi on JetBlue airplanes. That Wi-Fi capability has enabled the rollout of iPads to in-flight crew members and flight attendants, helping them stay connected, work more efficiently, and provide passengers with more personalized services. Sundaram is also engaging employees by providing the tools and IT support that enable them to participate in technology-led innovation. As a result, three JetBlue pilots are partnering with IT developers to build applications.

Disruptive business innovation. There’s no denying the importance of internally focused innovation, but CIOs are now responsible for directly helping businesses create value as well. Toward that end, they must consider ways to essentially monetize IT assets—from digital breakthroughs and data to new technology-driven products and services. Vanguard CIO John Marcante collaborated with leaders in the retail division of his company to create Vanguard Personal Advisor, a virtual advisory service for customers that combines investment methodology, an intuitive online user experience, sophisticated investment modeling technology, and traditional advisory services. Since launching in May 2015, it has grown to $31 billion in assets under management and has decreased the minimum asset threshold from $100,000 to $50,000.

The Ecosystem Era

Collaboration and partnerships play key roles in enabling disruptive business innovations, so it’s increasingly up to CIOs to consider how partners and ecosystems can be leveraged to fuel expansion. Firms like Airbnb and Uber are experiencing explosive growth, thanks in part to experimental ecosystems that are asset-light and highly decentralized. By connecting with partners and ecosystems, CIOs can help ensure their own organizations evolve in new ways.

A recent IDC report predicts that, by 2018, Salesforce.com and its ecosystem of customers and partners will generate $272 billion worldwide—2.8 times the revenue of Salesforce.com itself. In the words of one CIO who participated in the 2015 Deloitte Global CIO Survey, “CIOs in the future must do outreach and bring in partners.”

That’s just what BNY Mellon’s CIO Suresh Kumar has been doing for some time. Aiming to help reinvent the 200-year-old company’s technology development and deployment processes, Kumar is not only engaging with the business to drive innovation, he is developing an ecosystem of global partners to further its efforts outside the company. In 2012, Kumar and his team began an ambitious digital transformation to prepare the company for the future, including increasing its ability to be more innovative. The process involved partnering with leading organizations for guidance and building a network of innovation centers around the globe. The innovation centers, which employ about 2,000 people, work with collaborators from outside the business to foster partnerships, share ideas, and explore use cases for disruptive technologies like blockchain. They also reach out to the broader technology community, hosting meetups and hackathons and sponsoring events.

“For guidance, we looked to other progressive companies, including the technology and innovation leaders in Silicon Valley,” Kumar explains in a recent article. “As we worked with these new colleagues, we learned from them, again and again, the keystones to successful innovation and industry advancement: collaboration, experimentation, sharing, adapting.”

Building Influence

Carrying out the innovation agenda cannot be done part time or piecemeal. It requires a change in mindset and a consistent investment of time, resources, funding, and evangelism. It also can’t be done in a silo. By looking beyond the IT organization for innovation partners, CIOs can help lay the groundwork for related, modularized, or adjacent products and services. Opportunities may also abound outside the company’s four walls among industry and nonindustry partners, suppliers, and existing ecosystems.

For CIOs to become strategic innovation evangelists, it’s important to lead discussions on how innovation plans will help the company and its customers do things better, faster, smarter, or cheaper. This will allow them to build enough trust and credibility to effectively promote their innovation plans. But before embarking on any grand-scale projects, the basics must be in place. CIOs can build innovation credibility with reliable, efficient, cost-effective IT operations which, in turn, will build influence with C-suite and business stakeholders. It can be effective to innovate within IT first, then look outside the department and the firm for innovation partners.

CIOs already understand how information flows and how technology can shape or support innovation. Now they need to master each level of innovation, with the understanding that one builds upon the other. That means determining where opportunity exists today and building a path to innovation that can propel the business forward into the future.

—by Khalid Kark, research director, U.S. CIO Program, Deloitte LLP

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November 7, 2016, 12:01 am

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This publication contains general information only and Deloitte LLP and its subsidiaries ("Deloitte") are not, by means of this publication, rendering accounting, business, financial, investment, legal, tax or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication. Copyright © 2016 Deloitte Development LLC.
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