Business-Minded CIO Leading Implementation. Prof.Dr. Srisakdi Charmonman Chief Executive Officer College of Internet Distance Education Assumption University

Business-Minded CIO Business-Minded CIO Leading Implementation.Leading Implementation.

Prof.Dr. Srisakdi CharmonmanProf.Dr. Srisakdi Charmonman Chief Executive OfficerChief Executive Officer

College of Internet Distance EducationCollege of Internet Distance EducationAssumption University of ThailandAssumption University of Thailand

[email protected]@ksc.au.edu www.charm.au.eduwww.charm.au.edu

Invited paper presented to the Second Annual Asia IT Congress, Invited paper presented to the Second Annual Asia IT Congress, organized by Marcus Evans Conference Organization, organized by Marcus Evans Conference Organization,

QueenQueen Sirikit Sirikit National National Convention Center, Bangkok Thailand, Convention Center, Bangkok Thailand, September 3-4, 2007September 3-4, 2007 1

Dr. Panyaluck UdomleartprasertDr. Panyaluck UdomleartprasertSpecial Lecture in the Graduate School Special Lecture in the Graduate School

of Onformation Technology of Onformation Technology of Asumption Universityof Asumption University

Co-AuthorCo-Author

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1.1. Introduction.Introduction.2.2. CIO Strategic Leadership Definition CIO Strategic Leadership Definition

and Roles.and Roles.3.3. Turning the Focus and IT Turning the Focus and IT

to Deliver Efficiency and Business Value.to Deliver Efficiency and Business Value.4.4. Playing a Leading Role in Identifying Playing a Leading Role in Identifying

Opportunities.Opportunities.5.5. Concluding Remarks.Concluding Remarks.

Business-Minded CIO Business-Minded CIO Leading Implementation.Leading Implementation.

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• Globalization makes more important Globalization makes more important of the concepts of outsourcing, of the concepts of outsourcing, information security, risk management, information security, risk management, communication networking, communication networking, and some such.and some such.

1. Introduction.1. Introduction.

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• IT leaders have to take the role IT leaders have to take the role to employ those concepts to employ those concepts on behalf of the organization.on behalf of the organization.

• The first generation of IT leaders The first generation of IT leaders is known as is known as - CIO (Chief Information Officer)- CIO (Chief Information Officer)- CTO (Chief Technology Officer)- CTO (Chief Technology Officer)

Introduction Introduction (Cont.)(Cont.)

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• The accountabilities of CIOs The accountabilities of CIOs are for using technology to facilitate are for using technology to facilitate business processes and for enhancing business processes and for enhancing the organization’s strategic direction.the organization’s strategic direction.

• The organizations also expect CIOs The organizations also expect CIOs to have significant ideas about to have significant ideas about how technology transforms and creates how technology transforms and creates business values.business values.


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• The CIO of tomorrow will be more important The CIO of tomorrow will be more important

in organization knowledge centralization.in organization knowledge centralization. • In the future, it is probably that the position In the future, it is probably that the position

of CIO (Chief Information Officer) of CIO (Chief Information Officer) and CTO (Chief Technology Officer) and CTO (Chief Technology Officer) will be promoted to will be promoted to ““CKO (Chief Knowledge Officer)CKO (Chief Knowledge Officer)””..


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• The roles of CKO might be slightly different The roles of CKO might be slightly different and absolutely more important than and absolutely more important than those of CIO and CTO.those of CIO and CTO.

• Today businesses do need the CIOs Today businesses do need the CIOs to be the general thought leaders to be the general thought leaders and coordinators of business technology.and coordinators of business technology.


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2.1 2.1 Definitions of CIO, CTO and CKDefinitions of CIO, CTO and CKO.O.2.2 CIO Strategic Leadership Role.2.2 CIO Strategic Leadership Role.

2. CIO Strategic Leadership Definition 2. CIO Strategic Leadership Definition and Roles.and Roles.

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• Searching Google for Searching Google for “define: CIO”“define: CIO”, , many entries were found, many entries were found, as shown in Figure 1.as shown in Figure 1.

2.1 2.1 Definitions of CIO, CTO and CKDefinitions of CIO, CTO and CKO.O.

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Definitions of CIO, CTO and CKDefinitions of CIO, CTO and CKO O (Cont.)(Cont.)

11Figure 1.Figure 1. Searching Google for “define: CIO”Searching Google for “define: CIO”

• From the web From the web ““en.wikipedia.orgen.wikipedia.org””,, CIO (CIO (Chief Executive OfficerChief Executive Officer) ) is a job title is a job title for the head of the Information Technology for the head of the Information Technology group within an organization, as Shown in group within an organization, as Shown in thethe Figure 2. Figure 2.


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13Figure 2. Definitions of CIO From Figure 2. Definitions of CIO From ““en.wikipedia.orgen.wikipedia.org””

• From the web From the web ““www.ndu.eduwww.ndu.edu” ” ,, CIO (CIO (Chief Executive OfficerChief Executive Officer) ) is the individual in an organization is the individual in an organization who is responsible for the strategic use who is responsible for the strategic use and management of information, and management of information, information systems, and information information systems, and information technology within that organization. technology within that organization.


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• Searching Google for Searching Google for “define: CTO”“define: CTO”, , many entries were found, as shown many entries were found, as shown in Figure 3.in Figure 3.


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16Figure 3. Searching Google for “define: CTO”Figure 3. Searching Google for “define: CTO”

• From the web From the web ““en.wikipedia.orgen.wikipedia.org”” ,, CTO (CTO (Chief Technical Officer or Chief Technical Officer or Chief Technology OfficerChief Technology Officer) ) is an executive is an executive position whose holder is focused on scientific position whose holder is focused on scientific and technical issues within a company, and technical issues within a company, as Shown in Figure 4. as Shown in Figure 4.


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Definitions of CIO, CTO and CKDefinitions of CIO, CTO and CKO O (Cont.) (Cont.)

18Figure 4. Definitions of CTO From Figure 4. Definitions of CTO From ““en.wikipedia.orgen.wikipedia.org””

• From the web From the web ““www.the-itleader.comwww.the-itleader.com”” ,,CTO (CTO (Chief Technical OfficerChief Technical Officer) ) has a similar has a similar role to the Chief Information Officer. role to the Chief Information Officer. They supervise the design, installation They supervise the design, installation and upkeep of networks and information and upkeep of networks and information systems. The CTO also develops and systems. The CTO also develops and implements strategic IT plans as well as implements strategic IT plans as well as supervising IT staff members.supervising IT staff members.


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• Searching Google for “CKO”Searching Google for “CKO”, , many entries were found, as shown many entries were found, as shown inin Figure 5.Figure 5.

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21Figure 5. Searching Google for “CKO”Figure 5. Searching Google for “CKO”


• From the web From the web ““www.pcmag.comwww.pcmag.com” ” ,,CKO (CKO (Chief Knowledge OfficerChief Knowledge Officer) ) is the executive officer responsible is the executive officer responsible for exchanging knowledge within for exchanging knowledge within an organization, as shown inan organization, as shown in Figure 6.Figure 6.

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23Figure 6. Definitions of CKO From Figure 6. Definitions of CKO From ““www.pcmag.comwww.pcmag.com””


• From the web From the web ““www.bitpipe.comwww.bitpipe.com”” ,,CKO (CKO (Chief Knowledge OfficerChief Knowledge Officer) ) are responsible for creating, initiating, are responsible for creating, initiating, driving, and coordinating knowledge driving, and coordinating knowledge management programs within management programs within an organization.an organization.

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2.2 CIO Strategic Leadership Role.2.2 CIO Strategic Leadership Role.

• CIO’s roles are focused more on CIO’s roles are focused more on the information technology and technical the information technology and technical aspects. aspects.

• This role is actually shaped This role is actually shaped by the business fulfill the needs by the business fulfill the needs in generating higher profitability.in generating higher profitability.

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CIO StrategicStrategic Leadership Role (Cont.)(Cont.)

• Therefore, CIO should have more strategic Therefore, CIO should have more strategic insight than just being a highly skilled insight than just being a highly skilled technician.technician.

• The new CIO agenda is to work hand in The new CIO agenda is to work hand in glove with the CEO to reshape the entire glove with the CEO to reshape the entire business.business.

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CIO Strategic LeadershipLeadership Role (Cont.)(Cont.)

• In term of organizational structure, In term of organizational structure, particularly, senior management people at particularly, senior management people at the Board of Trustees levelthe Board of Trustees level are CEO, COO, are CEO, COO, CFO and CIO or CTO. Generally the line of CFO and CIO or CTO. Generally the line of command in C-Level will report to CEOcommand in C-Level will report to CEO , , as shown in Figuas shown in Figure 7re 7..

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CIO Strategic Leadership Role CIO Strategic Leadership Role (Cont.)(Cont.)

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Chief Executive Chief Executive OfficerOfficer

Chief Chief Information Information Officer/Chief Officer/Chief Technology Technology

OfficerOfficer

Chief Financial Chief Financial OfficerOfficer

Chief Operating Chief Operating OfficerOfficer

Figure 5. The Line of Command in OrganizationFigure 5. The Line of Command in Organization

3. 3. Turning the Focus and IT to Deliver Turning the Focus and IT to Deliver Efficiency and Business ValueEfficiency and Business Value

• The key indicators for CIO to observe whether it is the time to be the “Strategic CIO”.

• There are two signals: 1) Signal of Need. 2) Signal of Availability,

as shown in Figure 6

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Turning the Focus and IT to Deliver Turning the Focus and IT to Deliver Efficiency and Business ValueEfficiency and Business Value (Cont.)(Cont.)

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Signal Signal of of

AvailabiliyAvailabiliy

Indicators Indicators for for

Strategic Strategic CIOCIO

Signal of Need

Figure 6. Indicators for Strategic CIOFigure 6. Indicators for Strategic CIO

Turning the Focus and IT to Deliver Turning the Focus and IT to Deliver Efficiency and Business Value Efficiency and Business Value (Cont.)(Cont.)

• The signal of needs is the sign that the Strategic CIO is needed.

• Even there are needs of Strategic CIO, it may not be enough for the CIO, to fully adapt him or herself to be Strategic CIO.

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• He or she also needs to observe the availabilities of circumstance, for instances, the availability of innovative organization.

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1) Signal of Need1) Signal of Need

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• The signal of needs isThe signal of needs is the perspective the perspective that CIO observe if the surroundings that CIO observe if the surroundings need strategic CIO rather than just CIO.need strategic CIO rather than just CIO.

- Need from business to create - Need from business to create the new products and services. the new products and services.

-- Need from organization to making Need from organization to making progresses in term of expanding progresses in term of expanding and diversifying to a new business. and diversifying to a new business.

Signal of NeedSignal of Need (Cont.)(Cont.)

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- Need from customer to more - Need from customer to more total-service-oriented total-service-oriented than product-oriented.than product-oriented. - - Need from industry to focus Need from industry to focus on total solution on total solution such as outsourcing. such as outsourcing.

2) Signal of Availability2) Signal of Availability

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• Signal of AvailabilitySignal of Availability is the perspective is the perspective that enterprise will accept a CIO that enterprise will accept a CIO

who focuses on more than IT. who focuses on more than IT. - - Availability of high spending in IT for Availability of high spending in IT for endorsing the business endorsing the business of the organization.of the organization. - Availability of acknowledging - Availability of acknowledging

the vital of IT. the vital of IT.

Signal of Availability Signal of Availability (Cont.)(Cont.)

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- Availability of perception of IT potential Availability of perception of IT potential to business transformation. to business transformation. - - Availability of innovative organization.Availability of innovative organization.


3.1 It for Efficiency.3.1 It for Efficiency.3.2 Business Value of IT.3.2 Business Value of IT.

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• Efficiency Efficiency is achieved when the cost is achieved when the cost of producing a given output of producing a given output is as low as possible. is as low as possible.

• In another word, IT can help us In another word, IT can help us by providing organizations with new by providing organizations with new and unique ways to process business and unique ways to process business transactions and information.transactions and information.

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3.1 IT for Efficiency3.1 IT for Efficiency

• These unique capabilities can give These unique capabilities can give organizations with efficiency improvement. organizations with efficiency improvement.

• The investments, such as The investments, such as POS and properly implemented ERP systemsPOS and properly implemented ERP systems

may reduce costs and improve margins may reduce costs and improve margins and asset utilization.and asset utilization.

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IT for Efficiency IT for Efficiency (Cont.)(Cont.)

• Maintenance investments in systems Maintenance investments in systems such as such as accounting, control, payrollaccounting, control, payroll can help prevent margin erosion. can help prevent margin erosion.

• The benefits of IT efficiency The benefits of IT efficiency can be achieved both internally can be achieved both internally and externally.and externally.

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Internally Efficiency Internally Efficiency improvement are as follows:improvement are as follows:• Paperless Management Paperless Management • Better Communication via eMail Better Communication via eMail • Digital DDigital Database Managementatabase Management• Time Saving in Administrative JobTime Saving in Administrative Job• Computer-based OperationComputer-based Operation• Etc.Etc.

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External efficiency improvement are as follows:External efficiency improvement are as follows:• Better Communication via eMail Better Communication via eMail

with Customer, Partners. with Customer, Partners. • Cheaper Communication Cheaper Communication

Spending via IP Spending via IP • Time Saving Searching InformationTime Saving Searching Information• Etc.Etc.

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• The business value is a term representing The business value is a term representing all kinds of value that reflect all kinds of value that reflect the organization situation in long term.the organization situation in long term.

• In term of business management, In term of business management, firm or organization objective firm or organization objective is to maximize the stakeholder value.is to maximize the stakeholder value.

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3.2 Business Value of IT3.2 Business Value of IT

• In term of business management, In term of business management, firm or organization objective is to maximizefirm or organization objective is to maximizethe stakeholder value. the stakeholder value.

• Our question is how can the firm use IT Our question is how can the firm use IT to generate and maximize the value to generate and maximize the value

to those people?to those people?

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Business Value of IT Business Value of IT (Cont.)(Cont.)

• Information Technology Information Technology or IT can be used to increase overall or IT can be used to increase overall organizational value by two different ways; organizational value by two different ways;

efficiency and business value improvement.efficiency and business value improvement.

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3.2.1 Shareholder Value.3.2.1 Shareholder Value.3.2.2 Customer Value.3.2.2 Customer Value.3.2.3 Employee Value.3.2.3 Employee Value.3.2.4 Supplier Value.3.2.4 Supplier Value.3.2.5 Societal Value.3.2.5 Societal Value.

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• The term The term “shareholder value”“shareholder value” means the value which a person means the value which a person or an organization receives or an organization receives from another organization.from another organization.

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3.2.1 Shareholder Value3.2.1 Shareholder Value

• It is focus more in term of capital, money, stocks, return on investment (ROI), share price, profitability, market capital and other type of value.

• The phrase “Shareholder value added” should be compared to average/required increase in value, also cost of capital.

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Shareholder Value Shareholder Value (Cont.)(Cont.)

• The shareholder will be satisfied The shareholder will be satisfied if the value return to shareholder if the value return to shareholder

is as good as their expectation.is as good as their expectation.• A diagram showing shareholder value, A diagram showing shareholder value, as shown in Figure 8.as shown in Figure 8.

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Shareholder Value (Cont.) Shareholder Value (Cont.)

Shareholder

Stakeholder Value

CustomerCustomer

CustomerCustomer

Employee

Society Suppliers & Alliances

Enterprise Resources Enterprise Resources Planning (ERP) Planning (ERP)

Customer Relationship Customer Relationship Management (CRM) Management (CRM)

Human Resources Human Resources Information SystemInformation System (HRIS) (HRIS)

Supplier Relationship Supplier Relationship Management (SRM) Management (SRM)

IT GovernanceIT Governance

EmployeeEmployee

Suppliers &Suppliers & Society

ShareholderShareholder

Stakeholder Stakeholder

Figure 8. Composition of Stakeholder Value and Its IT Contribution

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• To maximize the shareholder value, To maximize the shareholder value, the integration of Information Technology the integration of Information Technology with the overall business performance with the overall business performance as well as shareholder value. as well as shareholder value.

• IT is used to improve overall efficiency, IT is used to improve overall efficiency, improve customer satisfaction and profits.improve customer satisfaction and profits.

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• Consider the case of GE, Consider the case of GE, Jack Welch focused on changing Jack Welch focused on changing

one area of business at a time: one area of business at a time: -- There was the structural revolution There was the structural revolution of the early 1980s, followed of the early 1980s, followed

by a cultural revolution, such asby a cultural revolution, such as the Work-Out (Welch's method the Work-Out (Welch's method for empowering workers to tell managers for empowering workers to tell managers about business problems).about business problems).

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• Next, business processes may be tackled Next, business processes may be tackled by implementing Six Sigma, followed by implementing Six Sigma, followed by the digitization revolution of the 1990s. by the digitization revolution of the 1990s.

• Currently, GE is still one Currently, GE is still one of the most profitable organizations of the most profitable organizations in the world.in the world.

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3.2.2 Customer Value3.2.2 Customer Value

• It is the value perceived by customer It is the value perceived by customer of the products and services. of the products and services.

• The satisfactory aspects of customer The satisfactory aspects of customer include quality of product, service level, include quality of product, service level, and after-sales service. and after-sales service.

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Customer Value Customer Value (Cont.)(Cont.)

• Customers are the source of money Customers are the source of money and so the firm always gives priority and so the firm always gives priority

to customer requirements that seem to customer requirements that seem to be more demanding. to be more demanding.

• The customer retention program The customer retention program is widely used because investing is widely used because investing in seeking new customer tends to cost in seeking new customer tends to cost more than keeping the existing customer.more than keeping the existing customer.

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• IT such as CRM can also be used to IT such as CRM can also be used to retain customer. retain customer.

• CRM stands for Customer CRM stands for Customer Relationship Management. Relationship Management.

• It is a strategy used to learn more It is a strategy used to learn more about customers' needs and behaviors about customers' needs and behaviors in order to develop stronger relationships in order to develop stronger relationships with them.with them.

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• Good customer relationships Good customer relationships are at the heart of business success. are at the heart of business success.

• There are many technological components There are many technological components

to CRM, but thinking that CRM to CRM, but thinking that CRM in primarily technological terms is a mistake.in primarily technological terms is a mistake.

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• The more useful way to think The more useful way to think

about about CRM is as a strategic processCRM is as a strategic process

that will help you better understand that will help you better understand your customers’ needs your customers’ needs and how you can meet those needs and how you can meet those needs and enhance your bottom line and enhance your bottom line at the same time.at the same time.

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• There are many technological components There are many technological components

to CRM, but thinking that CRM in primarily to CRM, but thinking that CRM in primarily

technological terms is a mistake.technological terms is a mistake.

• This strategy depends on bringing together This strategy depends on bringing together lots of pieces of information about customers :lots of pieces of information about customers :

- Market trends so you can sell.- Market trends so you can sell.

- Market your products. - Market your products.

- Services more effectively.- Services more effectively.

• An employee receives a value An employee receives a value from their employer in return from their employer in return for their performance on the job.for their performance on the job.

• It is the It is the taketake versus the versus the givegive..• Employee value consists of: Employee value consists of: - Career advancement.- Career advancement. - Compensation.- Compensation. - Work environment.- Work environment.

3.2.3 Employee Value3.2.3 Employee Value

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• If the employers perceive they If the employers perceive they getget rewards rewards equal to or exceeding what they equal to or exceeding what they taketake, , the organization will tend to have more the organization will tend to have more satisfied employees to increased royalty satisfied employees to increased royalty and retention.and retention.

Employee Value (Cont.)Employee Value (Cont.)

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• The human capital is transferred The human capital is transferred to the organization value in return.to the organization value in return.

• IT such as eLearning and HRIS IT such as eLearning and HRIS are widely used worldwide.are widely used worldwide.


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• HRIS is an intersection HRIS is an intersection between Human Resource Management between Human Resource Management (HRM) and Information Technology(HRM) and Information Technology..

• HRIS merges HRM as a discipline HRIS merges HRM as a discipline and its basic HR activities and its basic HR activities and processes with the Information and processes with the Information Technology field.Technology field.


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• Planning and programming Planning and programming of data processing systems of data processing systems evolved into standardized routines evolved into standardized routines and packages of Enterprise and packages of Enterprise Resource Planning (ERP) software.Resource Planning (ERP) software.

• The HR management module The HR management module is a component covering all other is a component covering all other HR aspects from application to retirement. HR aspects from application to retirement.

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• The system records: The system records: - Basic demographic and address data.- Basic demographic and address data. - Selection.- Selection. - Training and development.- Training and development. - Capabilities and skills management.- Capabilities and skills management. - Compensation planning records. - Compensation planning records. - Other related activities.- Other related activities.

3.2.4 Supplier Value3.2.4 Supplier Value

• Suppliers including partners and alliances Suppliers including partners and alliances are important part of the firm success.are important part of the firm success.

• Suppliers are the party who provide the Suppliers are the party who provide the material, products and services to a firm.material, products and services to a firm.

• Alliances and partners Alliances and partners are the parties who work are the parties who work and cooperate with a firm.and cooperate with a firm.

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Supplier Value (Cont.)Supplier Value (Cont.)

• Firm can not create Firm can not create the best product and service to customer the best product and service to customer without the cooperation from them.without the cooperation from them.

• The business willThe business will remain remain as long as there stakeholders are satisfied.as long as there stakeholders are satisfied.

• The supplier value is based on good The supplier value is based on good relationship between firm relationship between firm and financial payment. and financial payment.

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• IT can create the good relationship IT can create the good relationship among firmsamong firms..

• Supplier Relationship Management (SRM) Supplier Relationship Management (SRM) program can help you in negotiating for:program can help you in negotiating for:

- Lowering product costs.- Lowering product costs. - Reducing the overall transaction costs. - Reducing the overall transaction costs. - Compressing cycle time. - Compressing cycle time.

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• Firm is able to use SRM Firm is able to use SRM to enhance the supplier community to enhance the supplier community for each organization for each organization and establish a stronger relationship and establish a stronger relationship across the supply chain.across the supply chain.

• Societal value is the firm contribution Societal value is the firm contribution to society and sometime it is called to society and sometime it is called social responsibility.social responsibility.

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3.2.5 Societal Value3.2.5 Societal Value

• Firm can contribute to society Firm can contribute to society in various ways such as:in various ways such as: - Environmental concerns.- Environmental concerns.

- Donation and charity.- Donation and charity. - Good governance.- Good governance.• IT is used to reflect IT is used to reflect

the transparent working in organization.the transparent working in organization.

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Societal Value (Cont.)Societal Value (Cont.)

• Data are manually kept and modified easily.Data are manually kept and modified easily.• IT can put the right thing IT can put the right thing

to the right system with the transparency.to the right system with the transparency. • The discipline of information technology The discipline of information technology

governance derives from corporate governance derives from corporate governance and deals primarily governance and deals primarily with the connection between business focus with the connection between business focus and IT management of an organizationand IT management of an organization. .

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• The importance of IT related matters in The importance of IT related matters in contemporary organizations. contemporary organizations.

• Strategic IT decisions should be owned Strategic IT decisions should be owned by the corporate board. by the corporate board.

• The primary goals for IT governance are: The primary goals for IT governance are: - To Assure that the investments in IT - To Assure that the investments in IT

generate business value. generate business value. - To Mitigate the risks - To Mitigate the risks

that are associated with IT. that are associated with IT.

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• Goals for IT governanceGoals for IT governance can be done by can be done by implementing an organizational structure implementing an organizational structure with well-defined roles with well-defined roles for the responsibility of: for the responsibility of: -- Information.Information.- Business processes.- Business processes.- Applications.- Applications.- Infrastructure, etc.- Infrastructure, etc.

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4. 4. Leading Role in Identifying Leading Role in Identifying OpportunitiesOpportunities

• Many firms now are facing Many firms now are facing with the lack of productivity. with the lack of productivity.

• Along with intense competition Along with intense competition and shrinking product lifecycles, and shrinking product lifecycles, all the dissatisfaction emerges all the dissatisfaction emerges a tremendous opportunity for CIOsa tremendous opportunity for CIOsto use IT as the connection to use IT as the connection for an innovation process.for an innovation process.

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Leading Role in Identifying Leading Role in Identifying Opportunities Opportunities (Cont.)(Cont.)

• The CEO wants to invite these groupsThe CEO wants to invite these groupsinto the innovation process, which are:into the innovation process, which are:

- Customers.- Customers. - Suppliers.- Suppliers. - Independent innovation mercenaries.- Independent innovation mercenaries. - Competitors. - Competitors.

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• The innovation processThe innovation process will be less productive than the old one,will be less productive than the old one,if these groups can’t effectively:if these groups can’t effectively:

- Communicate.- Communicate. - Collaborate. - Collaborate. - Share information.- Share information.

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• According to nearly 80 percent of the CEOs According to nearly 80 percent of the CEOs studied by IBM, integration is critical studied by IBM, integration is critical that is integration of:that is integration of:- Data.- Data.- People.- People.- Internal organizations.- Internal organizations.- External organizations.- External organizations.


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4.1 CIO and Innovation.4.1 CIO and Innovation.4.2 CIO and Business Process Improvement.4.2 CIO and Business Process Improvement.


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4.1 4.1 CIO and InnovationCIO and Innovation

• Organizations may not be able to develop Organizations may not be able to develop and maintain a long-term and maintain a long-term competitive advantage in innovation competitive advantage in innovation unless the CIO plays a bigger part unless the CIO plays a bigger part in developing the strategy in developing the strategy as well as executing it.as well as executing it.

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CIO and InnovationCIO and Innovation (Cont.)(Cont.)

• The important role for CIOThe important role for CIOis that to improve and manageis that to improve and managethe innovation process.the innovation process.

• CIO needs to shift their emphasis CIO needs to shift their emphasis toward breakthrough innovation, toward breakthrough innovation, especially in processes that increase revenue.especially in processes that increase revenue.

• Innovation is the process of renew.Innovation is the process of renew.

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CIO and InnovationCIO and Innovation (Cont.)(Cont.)

• Renew does not mean only to reinvent Renew does not mean only to reinvent the whole new thing but also the revisit the whole new thing but also the revisit and refresh or look it and refresh or look it in the other way round.in the other way round.

• Senior management people Senior management people need to create innovative environment need to create innovative environment as well as CIO. as well as CIO.

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Seven Do’s to create Seven Do’s to create innovative environmentinnovative environment

• Do Do BELIEVE BELIEVE that innovation that innovation is a mandatory and not preferable thing. is a mandatory and not preferable thing.

• Do Do OPEN OPEN to the new ideasto the new ideas..• Do Do UNDERSTAND AND HEARUNDERSTAND AND HEAR

customers’ voicecustomers’ voice..• Do Do ALIGNALIGN with business environment with business environment.. • Do Do BRINGBRING the learning to everyone the learning to everyone..• Do Do REMOVEREMOVE the constraints the constraints..• Do Do PRACTICEPRACTICE creative process. creative process.

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Seven Don’ts to create Seven Don’ts to create innovative environmentinnovative environment

• Don’tDon’t LEAVE LEAVE innovation to happen by itself.innovation to happen by itself. • Don’tDon’t CREATE CREATE obstacles to new ideas.obstacles to new ideas.• Don’tDon’t IGNORE IGNORE customers’ voice customers’ voice

and take eyes on market movement. and take eyes on market movement. • Don’tDon’t BE AFRAID BE AFRAID of failure froof failure from m innovation.innovation. • Don’tDon’t THINK THINK that innovation that innovation

is only management’s job.is only management’s job.• Don’tDon’t PREJUDGE PREJUDGE the different and new idea.the different and new idea. • Don’tDon’t MAKE MAKE innovation just pass overnight.innovation just pass overnight.

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4.2 CIO and Business Process 4.2 CIO and Business Process ImprovementImprovement

• Business Process Improvement (BPI) Business Process Improvement (BPI) is a systematic approach to help is a systematic approach to help any organization make significant changes any organization make significant changes in the way it does business. in the way it does business.

• The organization may be for:The organization may be for: - A profit business concern.- A profit business concern. - A non-profit organization concern.- A non-profit organization concern. - A government agency concern.- A government agency concern. - Any other ongoing concern. - Any other ongoing concern.

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CIO and Business Process CIO and Business Process ImprovementImprovement (Cont.)(Cont.)

• Business Process Improvement Business Process Improvement has a new name, “Business Process has a new name, “Business Process Management (BPM)”, with pressure of:Management (BPM)”, with pressure of:

- Global competition.- Global competition. - Customization. - Customization. - Government regulation.- Government regulation.• The new ways of business processes are The new ways of business processes are

reexamined to discover more efficient ways reexamined to discover more efficient ways to execute them through automation to execute them through automation or even outsourcing. or even outsourcing.

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CIO and Business Process CIO and Business Process Improvement (Cont.)Improvement (Cont.)

• BPM projects dealing with Supply Chain BPM projects dealing with Supply Chain Management (CRM).Management (CRM).

• CRM initiated by IT often get included CRM initiated by IT often get included into the businessinto the business

• Senior management realizes Senior management realizes that the very processes IT is automating that the very processes IT is automating are those that drive are those that drive his segment’s revenue.his segment’s revenue.

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• CIOs can successfully drive BPM.CIOs can successfully drive BPM.• CIOs have to persuade collaboration CIOs have to persuade collaboration

and understand:and understand: - Needs of the business. - Needs of the business. - Concerns of the business. - Concerns of the business. - Risks of the business. - Risks of the business. - Existing processes of the business. - Existing processes of the business.

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• CIOs have to become more proactive CIOs have to become more proactive in business process management, as it stated in business process management, as it stated in the column in the column “who controls“who controls business process business process improvement”improvement” by Meridith Levinson, by Meridith Levinson,the BPM of tomorrow, the BPM of tomorrow, Process Renewal Group’s Burlton.Process Renewal Group’s Burlton.

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CIO and Business Process CIO and Business Process ImprovementImprovement (Cont.)(Cont.)

• BPM is at the center of IT activity. BPM is at the center of IT activity. • ““Process is so important right now Process is so important right now

because it is the linchpin of all because it is the linchpin of all these other things we’ve talked about these other things we’ve talked about for years: ERP, CRM. Process holds for years: ERP, CRM. Process holds everything together.”everything together.” Burlton says.Burlton says.

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• Most modern organizations Most modern organizations are applying Information Technology are applying Information Technology in their business process management.in their business process management.

• CIO is the leader to do the business CIO is the leader to do the business process management.process management.

• CIO needs to know the business CIO needs to know the business and never propose technology and never propose technology for technology's sake.for technology's sake.

5. Concluding Remarks5. Concluding Remarks

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• Understanding the business Understanding the business is more than abstract philosophy.is more than abstract philosophy.

• The next generation of CIO The next generation of CIO will take a lead to create the business value will take a lead to create the business value as well as efficiency improvement. as well as efficiency improvement.

• The organizations expect the investments The organizations expect the investments as a way to increase competitiveness as a way to increase competitiveness and first or early-mover benefits. and first or early-mover benefits.

Concluding Remarks Concluding Remarks (Cont.)(Cont.)

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• The job of CIO is to give The job of CIO is to give the rapid rate of technological innovation the rapid rate of technological innovation that is more critical than ever before.that is more critical than ever before.

• CIO or Strategic CIO needs to prepare CIO or Strategic CIO needs to prepare his or her IT organization in such as way his or her IT organization in such as way not only to seek for the new technology not only to seek for the new technology but to be business minded but to be business minded to use technology to maximize to use technology to maximize the business value.the business value.

Concluding Remarks Concluding Remarks (Cont.)(Cont.)

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Thank youThank you

Documents

Business-Minded CIO Leading Implementation. Prof.Dr. Srisakdi Charmonman Chief Executive Officer College of Internet Distance Education Assumption University