Seemingly since the beginning of time, CIOs have been working to change their IT organizations from “order takers” into “business partners.” They have established business relationship management functions, developed “we are the business” rallying cries, and built leadership development programs emphasizing influence, courage, and business acumen.
These efforts have had a positive impact, but an incremental one. Yes, most IT leadership teams have stronger relationships with their business partners than, say, five years ago, but there is still a long way to go. “Raise the credibility of the IT organization” continues to appear at the top of the wish list that our clients give to our firm when we launch a new CIO search.
Encouraging technologists, often introverts who have spent their careers mastering complex skills, to deepen their understanding of marketing, commercial operations, supply chain, and finance is a slow march. But with the movement of software into the heart of most organizations’ products, services, and growth strategies, a slow march is not sufficient.
So, how do CIOs expedite the business partnership skills of their teams? They adopt what is clearly becoming the gold standard of IT and business team integration: a capabilities (or product) management model.
Carissa Rollins, who became the CIO of Illumina in April of this year, strongly believes in the capabilities management model. With the $5 billion biotech company expanding from R&D and manufacturing into clinical-based genomic health, Rollins sees IT playing an increasingly critical role in business growth and patient care.
“Traditionally, Illumina has focused on the lab, but we are now moving out of the lab and into personalized patient care,” says Rollins. “We are working with physicians and payers on ways to help people understand their genomic health.”
One area where IT can make its business impact felt is around Illumina’s recently announced the NovaSeq X Series, a powerful set of sequencers that promises to advance the real-world impact of genomic sequencing.
“NovaSeq X is an amazing machine,” Rollins says. “Now we need to surround it with a great customer experience that helps providers and patients understand the impact of data on patient health.”
Refocusing IT for business impact
Illumina’s shift from the lab to the patient necessitates Rollins’ IT team to have a more acute focus on customer data and experience. It also requires IT to take initiative to be a co-creator of business solutions.
“In IT, we are too focused on doing what the business wants us to do, so we don’t take the time to invest and learn about the business,” she says. “So, when they tell us what system they want, we don’t have enough knowledge to say, ‘Here is a better idea.’”
Rollins believes a capabilities model is essential, and it starts by establishing standards and reigning in shadow IT.
“It is important to strike the right balance between standards and citizen development,” she says. “In our complex world, IT cannot control everything, but we need standards, especially in our regulated environment. At the same time, we have to allow for citizen development, which will only grow as we hire young tech-savvy people who will work with RPA [robotic process automation] and ML [machine learning] on their own. They won’t wait for IT.”
RPA presents an excellent opportunity for citizen development, but not without the right foundation, as Rollins learned in a previous role. “Our business partners had created more than 300 bots without IT’s knowledge,” she says. “When we upgraded the system, we broke all of them.”
With standards and governance in place, the next step is defining the company’s target capabilities. On which capabilities does the company need to spend more time and money? On customer self-service to ensure a seamless experience? On IoT to be more efficient in device manufacturing?
“The good news is that most industries have a standard capability map to start with,” says Rollins. “Once we have that map, we need to socialize it with our business partners to make sure we all agree that these are Illumina’s target capabilities. This process never ends. The map is always evolving.”
With an agreed-upon capabilities map in hand, the next step is to assess how the current investment strategy aligns to it. “Once IT understands what we are investing in each capability, they become much more focused on our overall business strategy,” says Rollins. “They start to ask why we are spending so much on transportation management and so little on customer self-service, for example. The IT team starts to think like investors, not order-takers.”
Down to execution
The next chapter in the capabilities story is, of course, delivery. “As CIO, my job is to build a model that that gives IT and our business partners a roadmap that ties into our business strategy,” she says. “At that point, my role in capabilities management recedes, and the CTO position becomes more important.”
The CTO role has many different definitions in the market. Still, for Rollins and Illumina, that person is the lead architect and engineer of the platforms that support the capabilities roadmap. The CTO makes sure the platforms integrate, through APIs, into partner and customer platforms. “The CTO sets the standards for reusable platforms, while the capability manager knows what functions we need to deliver,” says Rollins.
Once you have a capability model that defines your investment strategy, and a CTO to build your platforms, now it is all about building the product teams to execute the capabilities map. “The temptation is to jump right in and build all of your capability teams at once,” says Rollins. “But my advice is to pick a few pilot areas, because how the capabilities teams will work together is very different from how work was done in the past.”
Let’s take customer self-service. The capability manager for the customer self-service team would likely be a very senior person from the customer service organization. That person listens to customer feedback to determine a features roadmap with sub-capabilities. The capability manager brings onto the team a lead engineer, responsible for architecture and design all the way through to testing. “These roles are no longer separate, which is a big shift for IT,” says Rollins. “Before, you had solution architects, developers, and testers. But in the capability model, the engineers are responsible for all those activities, which gives them greater responsibility for delivering the right capability.”
Rollins points out that each step toward a capability model is not linear, but should be run in parallel, and that not all capabilities, like those running on packaged software, will move into the new model right away.
But regardless of the approach, it is important for CIOs to move to the new model. “In a capability model, IT is no longer accountable just for delivering a new website in China; they are accountable for delivering the customer experience and the sales around that website,” she says. “CIOs cannot build technology-forward businesses with a traditional IT delivery model. We have to shift from delivering IT to delivering capabilities.”
IT Leadership, IT Strategy