The CIO as a venture capitalist

The CIO as a venture capitalist

If you want to innovate, think outside the norm

CIOs who want to help drive future business growth and innovation will need to develop a new mindset and new capabilities.

Long gone are the days when just managing IT operations, infrastructure and the help desk is enough. The CEO of today is expecting leadership from his CIO to take the organisation into the new world of innovation.

In a recent study by IBM’s Institute for Business Value, titled ’Moving from the back office to the front lines’, there was a clear message that CIOs in high performing enterprises see the world much like CEOs.

The 4,183 top executives who participated in the survey said technology, market factors and macro-economic considerations all have the biggest impact on business growth. Indeed, technology is now the number one pressure point for CEOs; four years ago, it was number six.

But I still have basics to manage

Yes, it is true that we need to keep the lights on to keep our organisations running smoothly. However it is also true that many CIOs use this as a crutch and focus on IT operations. Often, the demands of the business are heard but not met.

The truth is that keeping systems running well does need attention but CIOs need to step out of their comfort zone if they are to be recognised and rewarded.

Acting like a venture capitalist

To be like venture capitalists, CIOs should actively manage their IT portfolio in a way that drives enterprise value and evaluate portfolio performance in terms that business leaders understand.

I was recently at roundtable discussion with a group of venture capitalists, angel investors, lawyers, consultants, lobbyists and CIOs.

At the session – the question on everyone’s mind was ‘how can we get Australia to be more innovative?’ There was a dialogue about the need to encourage innovation and as you can expect, divided camps on the role of government.

Attendees discussed venture capital support provided through universities, as well as the lack of good technical resources in Australia.

All said and done, there was never going to be an easy answer to this question. And the end result was inconclusive.

Natural advantages

Every person, country and organisation has certain strengths. I’ve worked overseas and interacted with different cultures. During this time, I learnt an important lesson – rather than being frustrated with what you see, look at what makes a country and its people great and tap into that.

Five out of the eight professors who lectured me during an ‘Innovation for CTOs’ course at Stanford University in the United States, were of Indian descent. One in five of the IT executives in my class were also Indian.

This doesn’t surprise me; Indian IT specialists are talented and founders of many startups in Silicon Valley. Perhaps in Australia we still view India as just a low-cost offshore service provider.

I discussed this theory with a regional VP of an Indian provider. He looked at me, smiled and said: “Yes but the smartest Indians go to work in the USA.”

Is this is what is happening in our enterprises and corporations in Australia? Are the smart people, not feeling valued and therefore not taking a risk to share innovative ideas?

So ask yourself. What can I do as a CIO to encourage innovation within my team and across my organisation?

What role are we playing with regards to innovation? In the past, too many CIOs have been content to be ‘spectators’ and watch others try to innovate. Worse still, they act as ‘referees’ and architecture compliance as a shield to block new initiatives from being tested.

In the new world that we are entering, it is akin to moving from a flat even playing field to one that is multi-dimensioned like a cube. It is more complex and requires you to view the problem from different surfaces.

There will be natural advantages that we have to exploit and this will mean that we need to be agile and move quickly before others do.

The role we CIOs have to take is to be a ‘player.’ Not necessarily the best player but more that we are part of a team that includes others from the business and external partners.

It is an unlikely bunch like this that is going to make this innovation really sing. We will need to watch out that we haven’t excluded players to the team that can add value because of so-called norms.

Because after all, to be innovative, you have to think outside the norm.

David Gee is the former CIO of CUA where he recently completed a core banking transformation. He has more than 18 years' experience as a CIO, and was also previously director at KPMG Consulting. Connect with David on LinkedIn.

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