What’s Old Is New Again: IT Priorities, Business Processes and CPOs

By Meghann Wooster posted 12-21-2011 11:53

  

 

 

 

According to new research from McKinsey, the highest current priorities for IT include improving the effectiveness and efficiency of business processes and reducing IT costs.

For IT executives, reducing costs ranked first, followed by improving the effectiveness of business processes. Third was increasing the effectiveness of those processes.

The priorities for non-IT executives were a little different. Improving the effectiveness and efficiency of business processes ranked first and second, followed by providing managers with information to support planning and decision making.

Regardless of the differences between IT and non-IT leaders, it’s clear that process improvement is top-of-mind for executives across the organization. This jives with what we heard at the CIO Symposia we recently conducted in North Carolina and New York state.

CIOs Ask for Chief Process Officers

Kimberly Samuelson, who hosted the Symposia alongside Jereb Cheatham, Director of the Laserfiche Institute, and Kurt Rapelje, Director of Software Engineering, just published an article in which she writes:

CIOs are being tasked with getting more value out of their existing stacks, and creating composite applications is an effective way of achieving this goal. However, as more of these composite applications are created, bringing together different systems, departments and ways of getting work done, the need to clearly define process is becoming more important than ever.

The CIOs who participated in our Symposia suggested that enlisting the services of a Chief Process Officer (CPO) would help them drive change and IT innovation across the enterprise.

The CPO idea isn’t new. Back in ’04, Michael Hammer wrote that a CPO is “a new breed of manager who can take ownership of understanding, tracking, measuring, and optimizing an enterprise's crucial end-to-end business processes.”

In ’07, Hammer clarified that, in general, “the CIO is not in a position to drive and lead this effort. It can only be done by a senior, business-line executive.”

 

This, too, jives with what our CIOs said at the Symposia. They weren’t looking to assume the role of CPO, but they did want the person who donned the CPO’s cap to be both tech- and business-savvy. Writes Samuelson:

Ideally, the CPO comes from an IT background but has spent time embedded in different business units. This gives the CPO a “feet-on-the-street” understanding of the needs of the different BUs and the technical expertise to implement software and systems that meet those needs.

This didn’t make it into Samuelson’s article, but the reason our CIOs want a CPO with an IT background is that—according to them—non-IT people tend to be too afraid of “breaking something” to really kick the tires of the organization’s systems in the pursuit of process perfection. This, of course, doesn’t lend itself to reducing costs by squeezing more value out of the existing stack.

In ‘06, Josh Greenbaum asked whether the CPO would replace the CIO. He writes:

When the building blocks of business change are no longer as much about technology as they are about business process, “information technology” will cease to be as important as “process innovation.” That's because the competitive edge of a business will be defined more by what “disruptive innovators” can do with process innovation than what programmers and software developers can do with traditional IT….

Does this mean that CIOs will be sent out to pasture, replaced by a panoply of people with new job titles? Only if CIOs don't make the transition themselves.

What do you think? Should CIOs step up to assume the duties of a CPO as Greenbaum suggests, is Hammer correct in stating that a senior business-line exec is in the best position to drive process change throughout an organization, or did our CIOs get it right when they classified the ideal CPO as a product of both worlds?

 



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