In this age of the customer, the organisations that not only meet rapidly changing customer expectations, but are in a position to pre-empt their every need, will be the ones equipped to survive. Only those that deliver highly tailored products, services and experiences, continuously shaped by customer feedback and anticipating market signals, will win.
In other words, agility is all.
This is a message that CEOs are taking to heart. The 2019 KPMG CEO Outlook survey of 1,300 leaders in 11 key markets finds that 67 per cent of CEOs believe acting with agility is the new currency of business and if they are too slow, they will be bankrupt. This has risen from 59 per cent in 2018. While boardrooms and the C-suite are rapidly adopting the term ‘agile enterprise’, many are unaware that they may have a built-in advantage to accelerate their transformation: the CIO.
For IT, being ‘agile’ is a familiar concept. IT professionals have been the pioneers of it for nearly 20 years now. The 2019 Harvey Nash/KPMG CIO Survey, which includes the views of over 3,600 IT leaders around the world, shows that digital leaders are using agile practices to achieve higher business performance: half of digital leaders use modern delivery approaches like agile, lean, and DevOps that speed up project delivery compared to just 15 per cent of other businesses, and they are also much better at responding to changes in the business environment.
That’s why I believe that many CIOs are strongly placed to help CEOs in their drive to achieve organisational agility.
Achieving true agility is not easy. Even in IT, where we’ve been talking about it for two decades, it doesn’t always happen in the way that’s been hoped for. Culture, talent, ways of working, re-architecting the tool chain, scaling beyond IT, are all common challenges. Now, the C-suite push to embed agility at scale across the whole enterprise takes the challenge to a new level.
To be truly customer-centric and market-focused, businesses need agility not only in product-focused operations but right through the entire organisation – front, middle and back offices. Otherwise, they will not be able to pivot rapidly when they need to; held back by the slowest links in the value chain.
This brings us back to IT again. Because connecting the front, middle and back offices is the key hallmark of being a Connected Enterprise – businesses that are joined up all the way through the value stream, delivering seamless experiences that are laser-focused on the needs of customers.
Because access to technology has become so ubiquitous, powered with lean principles, collaboration tools and greater levels of out-of-the box automation, entire business segments are already much more able than before to work in an agile fashion. CIOs need to build on this and step up as champions and educators of new ways of working and organising, helping the business drive agility by focusing on a number of key approaches:
Keepers of agile practices
Products, not projects. Agility needs to be designed around customer outcomes – putting the products and services that they want in their hands. This means that the old project based approach of gathering requirements from across the business for a piece of work over a period of months won’t work. It’s got to be focused on specific products.
Integrated teams. Agility requires different parts of the business and enabling functions like IT, Finance, Security, HR, and Sourcing to work together daily on customer issues as one team. Silos have to be broken down. The business is part of the engineering team; IT is part of the business process. It can’t be ‘us and them’.
Iterative, fast, small decisions. Rather than approaching work in big blocks – the old project based method – it’s about breaking things down into small, specific points and iterating them continuously. This means making a series of small, micro investments to make changes or improvements – and then testing them constantly against customer feedback. It’s about using agile and DevOps ways of working to build, test, deploy and run solutions at pace – in hours or days, not months. It’s about tolerating failing fast and failing small; trusting the process even if the investment did not deliver the anticipated results.
Culture change through the right tools. Leaders recognise that agility requires a total culture change and a new mindset. But culture is sometimes an esoteric, abstract concept. One way it becomes real is by giving staff the tools that actually helps them work in an agile way. IT has a fundamental role to play here – whether that’s new portfolio management tools to better plan, chat and sharing tools to communicate and collaborate, or cloud-based applications that allow them to instantly organise suggestions, ideas and feedback.
Not everything needs to be agile. Another key point is that organisations should not chase windmills trying to make every single aspect of their business agile just for the sake of calling it that. Some services don’t need that. Take a retail bank. The online customer banking apps which are most likely hosted in the cloud, run across multiple platform and device types and are highly dependent on customer feedback, need to run at digital speed. But some products that connect to those digital speed products like processing internal financial reports, customer statements, loan maintenance applications, sitting on a mainframe, require a stable and secure environment, with changes released perhaps once a month: agile is not needed here.
Good CIOs are already the keepers of agile practices. Now, they need to help drive the dissemination of those practices right across the business, embedding the agility that CEOs are so anxious to see. There has probably never been a better time to be a CIO.
Steve Bates, Global Leader, CIO Advisory Centre of Excellence, KPMG International
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