A recent released results from a survey of 200 IT and business leaders released by TEKsystems finds close to one in four organizations (22%) saying that IoT is already delivering “a substantial impact" on their businesses.
The majority of organizations (55%) expect IoT initiatives to have a high level of impact on their business over the next five years and benefits anticipated include creating a better user and customer experience (expected by 64%), sparking innovation (56%), creating new and more efficient working practices and business processes (52%), and creating new revenue streams in terms of products and services (50%).
IT departments are spearheading this move and while business/ strategy, operations and R&D are also involved, what is surprising is the finding that only 9% indicate a close coordination between business and IT for their IoT projects.
Historically, few CIOs have gone on to become CEOs, meaning CEOs may lack the strategic knowledge of how IoT can help business transformation. Equally, since most CIOs aren’t groomed to be future CEOs, CIOs may lack experience to think strategically about how IoT impacts the entire business beyond IT.
With digital transformation becoming an important part of any business, it is important that there is an alignment between the CIO and CEO function, between technology and strategy. However as Forrester Research Sharyn Leaver discovers in a survey of 947 business and IT executives, only 27% of companies had a clear digital strategy, even as CIOs increase investments in cloud, mobile and analytics tools.
One of the key areas that Leaver identifies as crucial for the CIO to achieve in order to aid the CEO’s business strategy is in building an agile IT system. Sometimes it requires rebuilding their existing architecture; for example moving from a rigid on-premises environment to a more automated cloud system, so as to better address the agility required of the digital business.
“Companies should get comfortable producing a ‘minimum viable product’ and then continuously improve upon it. It can't be a three- to five-year strategy anymore, because it has to be fluid," Leaver says.
Established firms in any sector will have to overcome legacy investments in infrastructure and embrace new models of collecting, sharing, and making sense of data both collected and shared by Internet-enabled devices to recognize the IoT benefits of greater effectiveness and efficiency. Completely new business models will also emerge and challenge the status quo. Both CIOs and CEOs will need to focus on building a business that is more nimble, resilient and responsive than ever before.
The ideal scenario is illustrated by Dr. David A. Bray, CIO for the Federal Communications Commission, “With the right pairing of a strategic, future-focused CEO and CIO, the role of CIOs will evolve towards more of Chief Strategy Officer. The Chief Strategy Officer will seek new, transformative ideas and solutions to ensure the organization delivers great results, continues being relevant, and is resilient to the changes ahead.”
With IoT, the business potential from bridging the CIO and CEO functions becomes exponentially greater.