Click to learn more about author Leon Adato.
Change is everywhere, and expectations are high. Whether it’s called digital transformation or digital modernization—or if we’re shooting at servitization—nearly every business is revolutionizing its processes and supply-chain flows.
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For success, executives must understand enacting digital efficiencies isn’t just about people in the backroom doing something obscure. Transformation isn’t about creating a mobile app and calling it a day.
Digital change is an opportunity for execs to change as their industries also change. Every executive has been impacted by tech—so regardless of your business, you’re now in the tech ›business, too.
The Past Seems More Rational
In the past, you probably used CapEx for buying data centers. Governance was straightforward, based on physical possession of data, combined with limited access to the outside world.
You worked from a yearly budget, had quarterly planning, and the CFO understood the three-year CapEx burn-down. Your competitors operated this way, too—in fact, proper management meant everyone worked the same way. It was rational.
Then came cloud and emerging tech. There were big promises and variable pricing structures. The old five-year planning cycle evaporated. While some costs didn’t change, other expenses could blow the budget with no warning. We live in interesting times.
Speak a Common Language: Business
Everyone in the C-suite is now managing tech—the CMO uses tech, as does the CFO. Some execs make decisions when they don’t fully understand the ramifications of their choices. Technologists and executives, therefore, need a common language to get on the same page. To avoid misunderstandings, two things must happen:
- Agree on a common set of goals. Both technologists and the C-suite should reduce the number of misconceptions and on measurable business goals — rather than what often exists today, a seemingly random set of performance indicators not linked to business results.
- Both sides need to set aside jargon. Don’t use “inside baseball” terms to establish authority. Throwing your set of business acronyms around doesn’t move the conversation forward. Likewise, request tech pros don’t throw theirs at you (the tech pro will likely beat you on obscure acronyms, by the way). Shave down the double-talk and tie your tech goals to business initiatives or business outcomes.
It’s especially important to have these business conversations with others in the C-suite and with tech pros when you’re going into a new technology area. Remember, we’re coming off 20 years of having data centers and 10 years of virtualization—other execs may have some confusion. You can become the expert and mentor others.
Aim for a United Front
Just about every aspect of the company and every C-suite title is involved in technology in some way. Everyone needs to get on board and learn how to talk about tech in terms of measurable business goals.
Chief technologist roles from CIO to CTO can take the reins at being the unifiers between the C-suite and the IT department. Put in your two cents, but from a business point of view. Try these three things:
- Speak about technologies in terms of what they’ll do for the company. Measurable business goals always trump the cool factor.
- Don’t make an end-run around talking tech, though. Tech isn’t anathema. You should speak the language of business, but if the topic comes up, just make sure it’s well-grounded. Think of this time as a chance to renegotiate your social contract because transformation is all-encompassing.
- Check your cognitive biases. When it comes to adopting tech, there are at least three biases to be aware of: action bias (“let’s just do something now”), pro-innovation bias (“newer is always better than older”), and status-quo bias (“let’s not do anything at all”). Many more could also apply to you.
Measure It Correctly
Companies with a vast chasm between the C-suite and IT often bring in vendors to spackle over the dysfunction. The vendors show PowerPoint slides that talk feeds and speeds. Everyone ends up talking about feeds and speeds in the same way baseball wonks talk obscure statistics. No one is speaking in terms of business.
Encourage everyone to provide business instrumentation—along with traditional performance metrics—based on the data they already have.
Across your company, there are thousands of things to measure. You can find out how long people are staying on your website. You can tell what the average sales price is at checkout. You can find out how many items were added to the cart in the last five minutes of browsing. Some actionable things you can do include:
- Ask for actionable measurements. Applicationperformance management (APM) isthe best way to get the metrics you need.If you operate a factory, you can receive pulse measurements on yield, mechanical breakdown rates, and error rates. With this information, you can have a business conversation with a COO about the modernization of equipment and the down-line effects on yield.
- Encourage collaboration between tech pros and C-suite. The IT department may have given your team metrics for quite a while, but you’ve not understood the business value of those numbers. To get those significant numbers you need, explain to the factory networking team the importance of yield and the factors involved. Your tech team—which has been staring at the databases, networks, applications, machines, and everything else contributing to the effectiveness of the factory—will have some ideas of their own. The same is true for other departments.
- Become a laboratory. Strive to experiment on how to work together. Work together to change your company in dynamic ways.
Digital transformation (or whatever you want to call it) starts with everyone speaking the same language. You probably don’t care about the latest advances in fiber switching. They may not want to hear about the intricacies of low-rate financing for commercial real estate.
Shave off the role-based jargon and get back to the fundamentals of what everyone understands: how to sell more stuff and operate more efficiently. Remember, talk about results. Get the measurements. This is an opportunity to win.