Digital leadership CIONET Magazine, September 2014
Contents CIO CITY
EVENTS
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15 Supporting the Digital Agenda for Europe
Digital leadership in a VUCA world Digital leaders play a proactive role bringing their businesses to the next level.
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The art of balancing agility with stability Farfetch enhanced the competitiveness of its innovative business model during rapid growth.
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Digital leadership creates new areas of growth Philips’ IT organisation reshaped the company enabling customer centricity and rapid innovation.
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Leading by digital innovation New innovation approach at Ferrovial has led to the creation of new and profitable business lines.
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Integrating culture and technology European Research Paper of the Year 2014 strives for cultural adaptivity.
10 A race to be extinct or rock stars? Can the CIO take the lead in this VUCA world or will others do that for him?
12 21st century leadership requires a different mindset The fast-changing business landscape is leading to a different nature of leadership.
13 Building a digital business vision The digital leader strives to create new sources of value for customers.
14 Taking the lead against insider threats How can the CIO show leadership to tackle insider security threats?
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CIONET is an important stakeholder in helping Europe to make the transition to the Digital Era.
16 Change your culture How should organisations adapt to the changing needs in the hyperconnected world?
18 Ready for the Digital Leadership Luxembourg strives to become an information trust centre.
19 CIONET’s expansion to the Americas The CIONET community is starting up new networking businesses in Latin America.
20 Digital leadership in times of change IT is becoming increasingly more important for a future-proof enterprise design.
22 CIONET ITALIA AWARD 2014 CIONET Italy has honoured three CIOs for their innovative business projects.
24 Be where your members are CIONET Germany has launched a new series of regional networking events.
26 Value destruction or creation? Cybercrime causes many concerns but it can also lead to value creation.
30 The Digital Leader’s role To be successful in the new era the Digital Leader has to adjust his skills.
32 When the CIO meets HR A stronger relationship between the CIO and HR responds to the challenges of digital transformation.
34 A veritable balancing act CIOs must focus on stable operations at the same time as they support business growth.
CIO VISION 36 Digital Leaders integrate all the players Regard the digital revolution as a real opportunity and take advantage of it.
38 Business-focused IT Strong partnership between business users and IT boosts growth.
40 Early adopters The IT challenges of the public sector are not that different.
42 Developing capability in an upturn CIOs must be open to thinking outside the box when it comes to IT recruitment.
46 Cloud and XaaS are key for creative disruption How can CIOs be the catalysts for business innovation and growth?
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28 How to prove the value of IT?
47 Have a look at the full list of
To continually improve their business in the digital age CIOs must take a risk.
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Digital leadership For decades CIOs have been striving for fully stable systems, but now we have entered the era of Volatility, Uncertainty, Complexity and Ambiguity. In this VUCA world the focus is not on technology but on understanding how to use technology for value creation and digital transformation. How can the CIO master this and become the true digital leader who continuously exploits digital technologies to both create new sources of value and increase operational agility? At CIO CITY 2014 we honoured 3 of Europe’s most successful digital leaders. Congratulations to the 2014 European CIO of the Year award winners Nuno Miller, Jeroen Tas and Federico Flórez. Their digital leadership is a strategic asset that brings their business to the next level. Miller showed how to master the art of balancing agility with stability, while enhancing competitiveness with innovative business models. Tas proved how digital leadership creates new areas of growth by enabling customer centricity and rapid innovation. Flórez’ innovation approach has led to the creation of new and profitable business lines. The 2014 European Research Paper of the Year award winner, Professor Abraham Bernstein (University of Zürich), introduces in his winning paper a lowcost, yet efficient method to achieve automated cultural adaptivity for user interfaces. We hope these great examples and advanced research will inspire you on the path to digital leadership, shaping the future success of your organisation.
Hendrik Deckers Founder and managing partner CIONET International
Finally it is my pleasure to announce the launch of CIONET Colombia! For the first time our community is expanding beyond the European borders, and we are confident that under the leadership of Ricardo Olarte the Colombian CIO community will be a great success. Bienvenido a CIONET! May the force be with you!
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Digital leaders play a proactive role bringing their businesses to the next level.
Digital leadership in a VUCA world In a VUCA world business is relying increasingly more on IT and the digital strategy is at the core of business strategy. As both parties have to collaborate more closely than ever before, the CIO has become the digital leader.
Nils Fonstad, Associate Director at INSEAD eLab: “CIOs manage innovative business processes spending more time with business people and external partners. They have become the digital business leaders.”
More than 140 CIO’s from 10 European countries gathered at CIO CITY 2014 to discuss how digital leaders can thrive in an ever and faster changing VUCA world. In this world of Volatility, Uncertainty, Complexity and Ambiguity companies have to think fast and act fast to stay up with rapidly changing customer expectations. If they don’t, they will fall behind. The chilling question for the CIO is: “Can he help his company to become more agile?” In a VUCA world the digital strategy is at the core of business strategy. More than ever, the most successful organisations rely on CIOs and ICT professionals to achieve their strategic goals. At CIO City 2014, three CIOs who have made their organisations more successful by using ICT in more effective ways were honoured with the 2014 European CIO of the Year awards.
‘Can the CIO help his company to become more agile?’ 4
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The objectives of the awards are to raise awareness of the increasingly strategic and diverse roles of CIOs and ICT professionals, and to celebrate
the most accomplished CIOs. Out of a selection of top European CIOs, the CIONET International Advisory Board, in collaboration with INSEAD, and supported by the ECOTY International Jury, elected the European CIO of the Year 2014 award winners in the categories of Technology driven CIO, Business Process driven CIO and Client driven CIO. The categories are based on what kind of business value the winners bring most to their organisations. All three types have their merits, and one is not necessarily better than the other. Everything depends on the context of the organisation and the vision its general management has on ICT.
Digital business leaders Just like in the past years the finalists proved to be incredibly accomplished CIOs. But there were also two major differences with previous editions. Firstly, more of the candidates have recently been promoted. Because of their successes they are now being asked by their businesses to do even more and take up more
More than 140 IT leaders from 10 European countries gathered at CIO CITY 2014 to discuss how digital leaders can thrive in an ever and faster changing VUCA world. Vice President and European Commissioner Maroš Šefčovič: “It is very important to have a platform such as CIONET, where CIOs, business leaders and academics gather to exchange their experiences and best practices.”
responsibilities. Increasingly, organisations rely on ICT to support their operations and launch innovations. Therefore they need the leadership that CIOs represent. Secondly, there were more technology-focused candidates than in past editions. Does this mean that CIOs are returning to their role as order takers? That is not the case. Actually, they are much more than ever aligned with the business and both parties are collaborating more closely than before. “CIOs manage innovative business processes spending more time with business people and external partners. They have become the digital business leaders”, explained Nils Olaya Fonstad, Associate Director at INSEAD eLab.
Changing the world The 2014 European CIO of the Year awards were handed out by Maroš Šefčovič, Vice President of the European Commission and European Commissioner for Inter-Institutional Relations and Administration. He stated that through ICT and technology we are really changing the word. “I know how important CIOs are for every organisation and every institution. Therefore it is very important to have a platform such as CIONET where they gather with business leaders and academics to exchange their experiences and best practices”, said Šefčovič.
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He also explained how the EU is involved in promoting the Digital Agenda for Europe. “The goal of the Digital Agenda is to establish a digital single market without barriers such as roaming costs from telecom providers. Another goal is to help SMEs to get better access to the single market. They are facing problems such as language barriers and different administrative procedures in various counties. Undoubtedly ICT can help to solve these problems by developing userfriendly tools”, Šefčovič said. “We also support the development of digital skills. While Europe faces massive unemployment, technology companies are threatened by a critical shortfall of ICT experts. This is a threat to Europe’s potential for growth and digital competitiveness. However, ICT jobs are stable and well-paid and we must raise awareness about this”, Šefčovič continued. He added that the European Commission also supports e-government which is a priority for most of the EU member states. “Finally, ICT also has an important role to play in improving the efficiency of the European institutions”, Šefčovič concluded. www.ciocity.com http://ecoty.eu
In a VUCA world organisations need the leadership that CIOs represent.
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Farfetch enhanced its competitiveness during rapid growth.
Balancing agility with stability To sustain growth of more than 100% a year, Nuno Miller has been balancing the need to respond rapidly to new opportunities with the requirement to have an effective and efficient global platform. In 2011, when Nuno Miller became CIO of the e-commerce marketplace Farfetch, he discovered that most of its servers were inadequately serviced. To solve this, Miller and his team transformed the company’s storage services into two different data centres. The most critical services and tools were migrated to a robust and advanced hosting company based in London. All other services were relocated to a different hosting company, in a private cloud model. During the process, the IT team also transformed several processes using internal tools into processes that could be accomplished with cloud-based software services.
The new e-commerce platform was able to support an average increase of daily visits by 300%, with peeks of around 1,000%. The availability of key services increased from 99,5% to 99,95%. This led to a productivity increase of the back office teams, resulting in estimated savings of €200,000 per year. There was also a significant increase in sales volume, from €27,5 million in 2011 to €140 million in 2013. Miller and his team also streamlined Farfetch’s product management process. Product creation is done jointly by Farfetch and the boutiques. Each
Nuno Miller European CIO of the Year 2014 Technology Driven Nuno Miller from Portugal, former CIO of Farfetch, is now Managing Director and CTO at Videdressing. At the award ceremony, Miller stated: “It was a big challenge to grow from a small to a big team while increasing agility.”
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season, around 50,000 products were catalogued, categorised and photographed. However, as products were photographed by multiple boutiques, there were many duplicates. Therefore, IT developed a process to identify duplicates. As a result, around 25% of the products are being identified as duplicates in early stages, resulting in a 20% productivity increase. They also helped Farfetch to manage its yearly growth rate of over 100%. The size of the IT team was increased from 13 to 75 people. This fast pace required a change of the IT governance model and project management methodologies. Miller organised the IT group into different teams and fields of expertise and adopted SCRUM as the main methodology.
Responding rapidly Miller creates a yearly road map with quarterly reviews for all strategic projects. Every three weeks, for all projects, prioritisation meetings with the business stakeholders are being held and, again every three weeks, IT delivers a set of new features. This way, Miller and his team ensure that Farfetch can continue to grow and respond rapidly to new opportunities while improving the efficiency of its core operations. http://ecoty.eu
Philips’ IT organisation enabled customer centricity and rapid innovation.
Creating new areas of growth In his former role as a CIO, Jeroen Tas and his team fundamentally changed Philips’ approach to products, processes and the overall IT landscape. They also helped Philips respond innovatively to increasingly rapid changes in the market. In 2011, Jeroen Tas was hired as Philips’ CIO. Philips had been operating for too long as a disparate set of business units working somewhat independently. To accomplish an extensive transformation, Philips launched the Accelerate! transformation program. Tas and his team were integral to all aspects of the program. The IT organisation introduced new ways of collaborating closely with the business to develop solutions both rapidly and iteratively. They built strong governance around business processes and related IT investments. The leadership style changed from command and control to guide and coach. Today, all of Philips’ development projects and problem resolution projects apply Agile Scrum. Tas and his team, in close collaboration with business colleagues, cocreated an architectural blueprint for business processes and corresponding IT systems. They designed and delivered platforms that support the core processes, rather than point solutions for business units. As a result, IT costs were reduced.
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Next, Tas and his team focused on strengthening the data dimension of the ‘Philips’ real time enterprise’ ambition. They established an Enterprise Information Management group to manage data models and take responsibility for data operations, performance measurement and advanced analytics. They also rolled out a standard Sales and Service cloud solution, giving insight into customer information, sales and other key metrics. By May 2014, they had completed deployment in more than 100 countries across all sectors.
Digital innovation To speed up Philips’ digital innovation, Tas set up the Digital Accelerator Lab where specialists from Design, R&D, Marketing, Sales and IT co-produce innovation in self-managed teams. Two recently announced examples are the Google Glass IntelliVue Solutions proof of concept project and the proof of concept software that could ultimately give more independence to ALS and other patients. In January 2014, Tas was appointed to lead the new business group Healthcare Informatics.Solutions.Services as its CEO. A few months later, in a case study they developed on Tas’ accomplishments, Forrester research recognised Tas as ‘one of the most renowned technology visionaries in Europe’. http://ecoty.eu
Jeroen Tas European CIO of the Year 2014 Business Process Driven Jeroen Tas from the Netherlands, former CIO at Philips, is now CEO of Healthcare Informatics.Solutions.Services at Philips. At the award ceremony, Tas called the award “a tremendous honour for me and my teams.”
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Ferrovial’s new innovation approach has lead to new business lines.
Leading by digital innovation Federico Flórez simplified, aligned and integrated all the IT functions of Ferrovial into one central business unit. He also expanded the strategic role of IT implementing a new approach to innovation.
Federico Flórez European CIO of the Year 2014 - Client Driven Federico Flórez from Spain is Chief Information and Innovation Officer at Ferrovial. He is also chairman of the Global Purchasing Committee and member of the Executive Committee. At the award ceremony, Flórez said: “I especially like to thank you on behalf of the many colleagues working in my departments.”
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In 2008 Federico Flórez was appointed as CIO of Spain’s industrial giant Ferrovial. He inherited a heterogeneous set of 10 local IT departments, working with their own systems, different vendors and serving over 500 internal companies. These IT departments were purely IT-focused, rather than business-driven.
from observing a simple rule: not to believe that cloud service providers have no limits to their offering. Furthermore, he created business line IT functions, working closely together with business units. As a result, in just three years, customer satisfaction scores for the IT division rose from 4 to 7 on a scale of 10.
To tackle this challenge Flórez took a very structured approach. His first step was to simplify, align and integrate all the IT functions into one coherent, central business unit. He externalised several functions such as infrastructure and communications, resulting in savings of up to 20%. He also centralised all the IT purchases at group level. This resulted in cost savings of 25%. This effort was so successful that Ferrovial decided to nominate Flórez as chairman of its Global Purchasing Committee.
Expanding IT role
Flórez also developed a highly strategic approach to cloud services. He transferred Human Resources and Purchasing to the cloud. Transferring HR – and 70,000 employees – took six months instead of the anticipated 18 months. This time saving resulted
This new approach to innovation has led to the creation of new and profitable business lines. One example is Ferrovial’s entrance into the energy efficiency market worldwide.
Flórez also expanded the strategic role of IT at Ferrovial. He proposed to the CEO to establish an innovation function. Today, it consists of 50 employees who investigate about 100 ideas and launch 30 innovation projects a year. He implemented a start-up approach, taking some risks and eliminating projects early if they showed no value. Many projects implied working with start-ups, establishing new types of partnerships and experimenting with new business models.
http://ecoty.eu
European Research Paper of the Year strives for cultural adaptivity.
Integrating culture and technology The development of IT systems and applications increasingly needs to deliver culturally rich and affective experiences. Customising user interfaces can increase satisfaction, revenue and market share. The European Research Paper of the Year 2014 award was organised by CIONET International, in close cooperation with the Benelux Chapter of the Association for Information Systems. The winning paper was written by Abraham Bernstein, Professor at the University of Zürich, Switzerland and his co-author Katharina Reinecke, Assistant Professor at the University of Michigan, USA. In the paper they state that adapting user interfaces to a user’s cultural background can increase satisfaction, revenue, and market share. Conventional approaches to catering for culture are restricted to adaptations for specific countries and modify only a limited number of interface components, such as the language or date and time formats. The authors argue that a more comprehensive personalization of interfaces to cultural background is needed to appeal to users in expanding markets. This paper introduces a low-cost, yet efficient method to achieve this goal: automated cultural adaptivity.
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Affective experiences The runner-up paper was written by Joe Nandhakumar, Professor at University of Warwick, UK, and the co-authors Nikiforos S. Panourgias, University of Warwick, UK, and Harry Scarbrough, Keele University, UK. The development of information systems and software applications increasingly needs to deliver culturally rich and affective experiences for user groups. In this paper, the researchers explore how the collaborative practices across different expert groups can enable this experiental dimension of use to be integrated into the development of a software product. In an empirical study of computer games development – an arena in which novelty and richness of the user experience is central to competitive success – the authors identify the challenge of conceptualising and realising a desired user experience when it can’t readily be specified in an initial design template, nor represented within the expertise of existing groups. www.erpoty.com
Abraham Bernstein, Professor at the University of Zürich, author of the winning paper ‘Knowing what a User Likes: a Design Science Approach to Interfaces that Automatically Adapt to Culture’. (Co-author: Katharina Reinecke, Assistant Professor at the University of Michigan) Joe Nandhakumar, Professor at the University of Warwick, author of the runnerup paper ‘From Knowing It to Getting It: Envisioning Practices in Computer Games Development’. (Co-authors: Nikiforos S. Panourgias, University of Warwick, and Harry Scarbrough, Keele University)
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Can the CIO take the lead in this VUCA world or will others do that for him?
A race to be extinct or rock stars? At CIO City 2014 the CIOs were warned that their role as digital leader may be taken over by others both from inside and outside the company. How can they deal with the massive uncertainties of a VUCA world? “The CIO may belong to a race heading for extinction”, warned Technology Thought Leader Peter Hinssen. “In times when technology is not special anymore and digital has become the New Normal, the CIO is losing his relevance. You would have expected the opposite. In the digital age the CIO should be the rock star of the company. But he is not.”
Technology Thought Leader Peter Hinssen, founder and CEO of Across Group: “CIOs are some of the most skilled people in organisations. Yet most innovations are driven by others.” Patrick Arlequeeuw, Former VicePresident at P&G and Director at Arlequeeuw Consulting: “It is very important to create a network of excellence together with your partners.”
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CIOs have always had the dream that one day they would have a fully stable system. “But that didn’t happen and now we have entered a VUCA world of Volatility, Uncertainty, Complexity and Ambiguity. CIOs don’t like these four words. In fact they love their opposites. But in the New Normal, the two key elements are speed and agility. In this context company strategies have become fluid.” How can the CIO play a credible role in these times of massive transformations? “CIOs are some of the most skilled people in organisations. Yet most innovations are driven by others. Marketing is beginning to learn
how to influence social networks. The CIO has to partner with the CMO. He also has to learn who his competitors are. Their average age is about 35 and they’re not corporately trained. They might even wear a hoody. Perhaps the CIO could bring some of their entrepreneurial spirit into his IT department? Leveraging their potential could even make IT the sexiest department.” Hinssen concluded: “In a VUCA world it’s not about technology, devices or apps. It is about how to use technology and understanding how networks come alive.”
Changing behaviour Patrick Arlequeeuw, former Vice President at P&G and Director at Arlequeeuw Consulting, stressed how the world has changed due to digitisation and non-brick-and-mortar companies selling consumer products. “Did you know that In recent years Amazon has become part of the top customer list of Procter & Gamble?”
Air Commodore Dré Kraak, Deputy Director & COO at the Joint IT Command of the Netherlands Defence Forces: “VUCA is very much the same as a combat arena.”
What are the consequences of going digital in a VUCA World for P&G? Arlequeeuw: “Going digital changes everything, going from ‘mass and shelf’ to ‘1-to-1 connections’ or from ‘no risk’ to ‘speed to market’ as startups can become big competitors very quickly. It also means going from ‘the what’ to ‘real-time insights and decision making’, from ‘push’ to a ‘real-time supply network - the digital value chain’. For the employees it means going from ‘my office‘ to ’connected anywhere anytime’. All these evolutions lead to changing behaviour at Procter & Gamble.” It is important to know that going digital is not about IT but about the business. “Going digital requires business sponsorship and committed outcomes. The transformation process takes time - three to five years. But once you’ve accomplished it, there are completely new rules such as a new way of delivering within 30, 60 or 90 days and agility - ‘adjust as you go’. You’ll need to apply a change management approach understanding that user friendly solutions make a difference. Finally, as most solutions already exist, it is very important to create a network of excellence together with your partners”, said Arlequeeuw.
Military expertise What would a VUCA world look like
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through the eyes of a fighter pilot? Air Commodore Dré Kraak, Deputy Director & COO at the Joint IT Command of the Netherlands Defence Forces: “I didn’t know what VUCA meant, so I started to read about it and understood very soon that it is nothing new for a military person. VUCA is very much the same as a combat arena. When you lift off your F16 you don’t know what is going to happen, nor how many adversaries there are. But one thing is for sure: you’re going to win. The environment is complex with threats coming both from the sky and from the ground. You need to know where your friends and where your enemies are.”
‘The CIO has to learn who his competitors are.’ Which values are important in a VUCA environment? “Always keep in mind what is important for your country and the military. Moreover, it is the boss who takes the decisions. Otherwise you are not credible. To align actions make sure everybody in your team has a shared view of the end result. You also have to take calculated risks. Pilots consider everything that may go wrong prior to take off and then are confident they can handle any situation. So they don’t
worry about it any more. Basically you should have a non-emotional approach but in critical situations some emotion is needed to react fast.” How did Kraak apply his experience as a fighter pilot in the IT environment he is currently leading? “Have high standards to take many decisions in a short time frame. But don’t rush things if it’s not necessary. If your engine fails at an altitude of 25,000 ft you still have enough time to solve the problem or leave the plane. Of course it is essential to have the right people around you, as in wartime. Furthermore, conversations between a pilot and the tower must be condensed giving a quick overview of the big picture. Communicate the same way with your board.”
In a VUCA world CIOs have to take calculated risks.
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The fast-changing business landscape is leading to a different nature of leadership.
21st century leadership requires a different mindset Twenty-first-century leadership practices go along with a different mindset. In the 20th century industrial value creation model ‘fitting in’ was all important. But in today’s innovation based model ‘not fitting in’ is key.
Professor Robert D. Austin, Copenhagen Business School, wrote the book ‘Harder Than I Thought: Adventures of a 21st Century Leader ‘(Harvard Business Review Press, co-authored with Richard L. Nolan and Shannon O’Donnell). In this fictional narrative the increasingly complex job of CEO is put in a real context. This allows the reader to walk alongside Jim Barton as he takes on his new CEO role. The story was developed in collaboration with real-life CEOs. It includes crucial lessons for anyone who wants to master the skills of a successful business leader in today’s rapidly shifting business landscape. Discussing the book at his CIO City 2014 workshop, Austin raised questions such as: “How should you go about deciding whether to accept a new job opportunity, in this case as a CEO?”; “In setting your team as a new leader, how aggressive should you be in making changes to an existing team?”; “How do you make these decisions?”; “How do you deal with employees’ complaints about the merit pay system?”
Outlier performance
Professor Robert D. Austin, Copenhagen Business School: “The dandelion metaphor offers an alternative way of thinking about human resources management.”
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Another question was: “How can a leader best encourage ‘outlier performance’ from her or his team?” Austin: “In a May 2014 press release SAP announced its intention to make people with autism 1% of the company’s workforce by 2020. SAP believes that innovation comes from the ‘edges’
and by employing people who think differently and spark innovation it will be prepared to handle the challenges of the 21st century.”
‘Innovation comes from the edges.’ Autism is a disorder associated with reduced ability to communicate with others and a preoccupation with repetitive activities of restricted focus. SAP has discovered that some people with autism have abilities that are extremely well-suited to performing some vital information technology tasks, such as software testing, quality control and security monitoring. SAP’s move embodies an emerging management principle called the Dandelion Principle. The dandelion metaphor offers an alternative way of thinking about human resources management. Most people regard the dandelion as a nuisance. Yet it has many positive characteristics. The roots can be roasted to make a coffee substitute. The leaves are edible and they are excellent sources of calcium, potassium, iron, manganese and vitamins. “In the 20th century industrial value creation ‘fitting in’ was all important. But in today’s innovation based value creation ‘not fitting in’ is key”, concluded Austin.
The digital leader strives to create new sources of value for customers.
Building a digital business vision The CIO must harness an emerging digital reality with new dynamic ecosystems of value. How can he master this and become the true digital leader? “The Future Of Business Is Digital”, said Nigel Fenwick, Vice President and Principal Analyst of Forrester Research at CIO City 2014. “Customers are digital. By 2017 around 74% of them will own smartphones. Products, markets and operations are also digital. Remarkably, 73% of business executives believe their company has a digital strategy but only 21% of executives say their CEO has set a clear digital vision. And 68% of executives believe the functional units in their business act as barriers of digital innovation.” “Bolt-on is not a winning strategy for digital business”, Fenwick said comparing the typical digital strategy to painting go-faster stripes on an old car. “That doesn’t transform it to a sports car - it remains an old car with stripes. Instead, digital business requires a completely different mindset. Customers create ‘dynamic ecosystems of value’ made up of digitally connected products and services that
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they combine to satisfy their desires, together delivering more value than the sum of their parts. Digital businesses continuously exploit digital technologies to both create new sources of value for customers and increase operational agility in service of customers.”
Strategies What are the strategies for a successful transformation to digital business? “One is to digitise the end-to-end customer experience. If one airline keeps you constantly informed about where your luggage is and the other one doesn’t, which one would you choose? Find out which apps customers use in their ecosystems and how you can connect with them. Another key strategy is to ‘create trusted machines to scale the customer experience’. Rolls-Royce airplane engines, for example, have sensors that help predict service needs before the plane lands. This improves the value for the airline as well as the end customers.”
‘Digital business requires a completely different mindset.’ Fenwick also recommended to source enhanced operational capabilities within the dynamic ecosystem. For example, BMW created the DriveNow
Nigel Fenwick, Vice President and Principal Analyst of Forrester Research: “The CIO should partner with the CMO and assist the CEO to build a digital business vision.”
car rental app in partnership with car rental company Sixt. Fenwick also suggests that companies digitise for agility over efficiency. The Shutl carrier network providing a very fast delivery service for online shopping is a good example of how retailers can leverage other partners to improve the customer experience in agile ways. “Finally, focus on rapid customercentric innovation. To help transform to a digital business, the CIO should partner with the CMO and assist the CEO to build a digital business vision”, concluded Fenwick.
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How can the CIO show leadership to tackle insider security threats?
Taking the lead against insider threats When a cybersecurity threat comes from within the business itself or from trusted partners the risks are incalculable. How can the CIO show leadership to tackle them effectively?
for outsiders”, Upton explained. Another key driver is the pervasive instrumentation of the planet with mobile and connected devices making the whole world an app producing platform. Finally, there is big data with issues such as privacy concerns, data ownership problems, problems with anonymisation, etc. Often the risks are not tangible as people forget what they’ve consented to.
Managing the insider risk
Cybersecurity is seen as something negative and CIOs naturally prefer to talk about the added value they can bring for the company. That makes it hard to research. “Insider attacks are even more delicate”, explained Professor David M. Upton at CIO City 2014.
Professor David M. Upton, Saïd Business School, University of Oxford: “The CIO must set the tone at the top and he needs to involve the board.”
“They are grossly under-reported only about 1%. Because of the nature of the incidents the companies that were attacked fear for their reputation. Insider threats are also more dangerous than outsider menaces which are often prevented by firewalls and intrusion detection systems. Insider attacks are now the second most costly after DDoS attacks but the number of insider attacks is growing faster.” There are many potential cyber insiders: the disgruntled employee, the personal assistant, the systems administrator, people working in the outsourced services or the supply chain,
Four trends
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the (h)activist, etc. Their motivations are various: from fraud to IP theft, revenge, activism, etc.
Four key trends are driving insider cyber insecurity. “First, social networking can be abused by criminals to gather intelligence for targeted attacks on staff. It also offers a great foothold opportunity through coercion using romance scams or blackmail. The second trend is the move to the cloud. The more people who are involved in the use of cloud services, the higher the risks. Among potential future scenarios are Trojan clouds imitating providers, pervasive and repeatable application framework attacks and cohabiting risks such as admin roles
How can the CIO manage the cyber insider risk effectively? “First of all, he has to realise that people’s behaviour is the highest risk factor. As insider threats can be provoked by poorly trained employees, he has to invest in training. Monitoring is also crucial. He has to look at behaviour patterns, monitor the websites people are visiting, etc. To manage the entire information supply chain, the CIO also has to examine his trusted partners critically and build appropriate controls into the collaboration processes. On a technical level he should consider the use of monitoring tools centered around the information infrastructure, for example psycho-technical detection tools. Finally, being a leader, the CIO must set the tone at the top defining security policies and best practices. Most of all, he needs to involve the board.
CIONET is an important stakeholder in helping Europe to make the transition to the Digital Era.
Supporting the Digital Agenda for Europe At CIO CITY 2014 Vice President and European Commissioner Maroš Šefčovič not only came to hand out the European CIO of the Year awards, he was also there to present the current status of the Digital Agenda for Europe (DAE). The objective of the DAE is to promote coherence of policies, mainstreaming ‘digital’ and laying down a clear vision on the development of the EU digital economy. Broadband is widely available, both consumers and e-government services are online and it is a breeding ground for new (regulatory) actions enabling digital transformation. Work still needs to be done on developing a digital single market and on high-speed infrastructure. The European Commission recognises that CIONET is a very important stakeholder in helping Europe to make the transition to the Digital Era, as European Commissioner Neelie Kroes pointed out at a previous CIO CITY. The community provides a unique platform for the gathering and dissemination of information. CIONET is therefore regularly invited as a partner in European taskforces. Furthermore, CIONET members participate as experts in Brussels based workgroups, present their experience at relevant EC conferences, participate in the Digital Agenda Assembly and organise regional EC events.
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E-skills Having the right e-skills is key for Europe’s economic recovery. At the same time Europe faces massive unemployment. This is why the EC launched the Grand Coalition for Digital Jobs, a multi-stakeholder partnership that endeavours to facilitate collaboration among public and private players, education providers and businesses to attract young people into ICT education. CIONET is a partner in the Grand Coalition. On top of this it will launch the national Grand Coalition for Portugal in October, supported by former EC President José Manuel Barroso. CIONET is also involved in a number of projects supporting the development of the e-CF (European e-Competence Framework). CIONET can in particular be of help in the development of e-leadership skills. On June 4th 2014, the European Commission event ‘New Curricula for e-Leadership - Delivering Skills for an Innovative and Competitive Europe’ was held in Madrid. It was organised by IE Business School together with CIONET,
At the EC event ‘New Curricula for e-Leadership’ Silvia Leal, Academic Director at IE Business School, reported on the results of a mapping of their curriculum development programme with the EC eleadership curriculum profile. (Copyright photo: Rafa Llano)
EuroCIO and APMG International. At the event Spanish industry leaders sent clear signals that there is a growing and critical lack of e-leaders. Universities and business schools demonstrated how they are going to deliver these in the future. To improve e-leadership quality they have started to implement the guidelines for curriculum development which have been formulated as part of the EC e-leadership initiative. Supporting the Digital Agenda for Europe will in the end help CIONET members and their organisations. If you are interested in contributing, please contact Frits Bussemaker, Liaison International Relations.
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How should organisations adapt to the changing needs in the hyperconnected world?
Change your culture In the new world of ‘always on’ and ‘always connected’ there is an extended mix of mobile devices and online tools for both professional and private purposes. How can organisations and companies manage this diversity from a technological, organisational and human perspective? A good example of how the use of online tools can optimise the relationships between employees and with external clients in a fast-changing environment comes from Folke Lemaitre, the founder and CEO of internet startup Engagor. After having worked a few years as Head of Software Development and Researcher for several companies, he became Director of Development at the online community site Netlog. He was quickly promoted to Vice President of Engineering and was responsible for around 50 people. In 2010 Folke decided to start his own company Engagor. The startup provides organisations and companies with an all-in-one social media management tool for marketing and customer service. With its comprehensive feature set, ease of use, powerful data analytics and actionable metrics, Engagor helps companies to drive meaningful business results from social media. Today, the startup company has offices in Ghent, Belgium, and San Francisco, USA.
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Lemaitre: “If you have a good idea, creating a new product is relatively simple. But organising all the rest around it is not that easy. How do you form an manage a good team? How do you organise your marketing? How do you organise your sales, your customer service, etc.? We chose for a multitude of first-class web-based productivity tools. Internally we use collaboration tools such as HipChat, Skype, Evernote, Hackpad, Dropbox, Trello, join.me, etc. We also make use of several online tools for customer service, customer statistics and lead generation. This consistent use of web-based tools stimulated a culture of internal and external communication and collaboration and it helped us to scale fast.”
The right moment How should we deal with the multitude of tools and devices? Should we allow the use of all possible tools? Philippe Verbeeck, IT Strategic Sourcing Manager at Atlas Copco: ”It is key to introduce the right tool at the right
moment. Videoconferencing, for example, already existed 15 years ago. At that time it did not succeed in delivering the expected business results. The technical limitations, high costs and low usability made it a failure, both from a user and from a business perspective. Today, not only the technology has progressed enormously, but user adoption too, turning it from a nice-to-have into a must-have delivering clear business benefits.”
‘The use of webbased tools helped us to scale fast.’ Are we now at the right moment to allow the use of mobile devices and social media in our companies? Verbeeck: “Young recruits often ask us if they can go on Facebook or use their fancy new Android phone in the workplace. They seek a work-life balance where work and pleasure seamlessly flow into each other. To be
Folke Lemaitre, CEO and founder of Engagor: “Our consistent use of online tools stimulated a culture of internal and external communication and collaboration.”
Philippe Verbeeck, IT Strategic Sourcing Manager at Atlas Copco: “To be attractive as an employer to the new generations we have to embrace a diversity of tools and devices in the workplace.”
Saskia Van Uffelen, CEO Belux of Ericsson and Digital Champion of Belgium: “As the baby boom generation as well as the following X and Y generations will continue to retire at an older age, over the coming years four generations will have to work together.”
attractive as an employer to the new generations, we have to embrace a diversity of tools and devices in the workplace. This is fully in line with the expectations about how we will be working in the future. As a result of globalisation and consumerisation, we will work anytime, anywhere and from a multitude of devices in a more collaborative way, including people from outside our own company. Atlas Copco has customers and partners all around the world and we will have to interact with them in various ways.”
diversity of technologies, job profiles and generations.
Secondly, if you don’t show a long term vision, the youngsters will soon lose their motivation. You also have to understand well that younger people don’t see leadership in the traditional way, as a hierarchical concept. They consider the leader as someone belonging to the team. Most importantly, their leader has to be a good communicator and always be accessible.”
Generation Z Generation Y, born between 1980 and 1992, already didn’t prove to be very easy to manage. But now Generation Z, born after 1992, is coming up. Not only do they ask for much more freedom in the use of mobile devices and online tools. They also have considerably different values. These evolutions require a shift in the culture of our organisations. The role of HR has to evolve to talent management taking into account the greater
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Saskia Van Uffelen, CEO Belux of Ericsson and Digital Champion of Belgium, adds: “As the baby boom generation as well as the following X and Y generations will continue to retire at an older age, over the coming years four generations will have to work together. Each generation has its own culture, its own way of working and its own contribution to the organisations. They share all the same values although they express them differently.”
‘Young employees look for a mix of work and fun.’ How do we keep the four generations motivated and working together in synergy? Van Uffelen: “First of all, check the DNA of your teams. Who belongs to which generation? Analyse the real nature of your organisation.
This article is based on the CIONET Belgium Networking Event ‘Organising work in a hyperconnected world’ of 24 April.
Younger people don’t see leadership in the traditional way, as a hierarchical concept.
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Luxembourg strives to become an information trust centre.
Ready to take the Digital Leadership At the 2014 Golden-i Gala, Luxembourg’s Prime Minister Xavier Bettel declared Luxembourg is ready to become an information trust centre. Luxembourg is blowing the wind of change in the CIO’s sails - and the government is there to support that evolution. “The mission of a CIO is not only to keep things running smoothly”, stressed Bettel. “It is also to foster innovation and strengthen the competitive edge.”
Amazon. But now banks, airlines, research institutes, laboratories, content providers and public services are also catching up. IT is gradually becoming a key element of every operational strategy, and, as a consequence, an item that is – or should be – on every CEO’s agenda.”
Vital for Luxembourg
New opportunities
Luxembourg’s future challenge will be to move the IT centre of gravity from being a specialised branch of business to becoming an undeniable core quality. “Luxembourg can be proud of its high-end data centres and abundant, state-of-the-art international connectivity. These are must-haves for a country today. But now we have to go further.”
“Data is the new oil”, Bettel continued. “Let’s create new opportunities with Big Data. Let’s build on our reputation as a trust centre for finance to become an information trust centre for any kind of valuable data. There is no better place in the world to host sensitive information than in Luxembourg. We have the knowledge, the skills, the infrastructure and the legal environment. The task of keeping financial data safe is the same for any other type of data. We know how to do the job in Luxembourg. We need to leverage these strengths and fine-tune our value proposition of Luxembourg as an information trust centre. Luxembourg is ready to take the Digital Leadership. At all levels.”
‘Data is the new oil.’ “We have the tools and we need to turn them into sustainable outcomes,” said Bettel. “I see things changing. I think there is, increasingly, a shift in consciousness of the strategic importance of technology, regardless of a company’s core business. This has always been the case for state of the art e-commerce players like Google or
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CIO of the Year At the same Golden-i Gala, Jean-Luc
Martino, CIO of Raiffeisen was elected as Luxembourg’s CIO of the Year 2014. He stated: “This is a great reward for Raiffeisen. It is a dynamic and friendly bank where it is good to live and work. Thanks go to our IT team. I coach them but they are the ones who do the job.” He also thanked Temenos, a company specialising in software for financial services that has helped Raiffeisen over the last 2 years. “Also thanks to our President, Guy Hoffmann, who has made IT a weapon for our Bank”, concluded Martino. Xavier Bettel, Prime Minister and Media and Communications Minister of Luxembourg: “The mission of a CIO is to foster innovation and strengthen the competitive edge.” Jean-Luc Martino, CIO of Raiffeisen was elected as Luxembourg’s CIO of the Year 2014.
The CIONET community is starting up new networking businesses in Latin America.
CIONET’s expansion to the Americas
Propose new members!
CIONET is crossing the Atlantic Ocean, expanding its networking business to Colombia, Mexico, Brazil and Peru. The goal is to become the only and best worldwide ICT network. The bigger the family, the more we can achieve all together in the ICT sector. CIONET has been growing since the day it was born in 2006. It started in a garage in Belgium and pretty soon it went out to conquer European countries such as the Netherlands, Spain and Italy. In only 7 years, CIONET has established a presence in the 10 most important European territories. And now it is time to take flight! We are crossing the great Atlantic Ocean and starting this marvellous networking business in Colombia, Mexico, Brazil and Peru. We live in a totally new digital age. Technology is now part of society, business and new management models. Moreover technology has made us global. Our goal is to become the only and best worldwide ICT network. We have all heard people talking about globalisation and we have all realised that there can be no effective globalisation without real, valuable and constant networking behind it. ICT people have to share, learn from each other, know ‘what´s next‘… Now this is possible in a more global way through CIONET.
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First steps CIONET Colombia is already working hard to get all the important Colombian CIOs on board. In August 2014 they celebrated their first Advisory Board meeting and held a press conference. CIONET Mexico is the next one to start in 2014. We are all busily getting the perfect local team together. The next steps are Brazil and Peru. Hopefully they will be on the CIONET map at the end of 2014 or beginning of 2015. Why are we telling you all this? Because we are proud of course but, more importantly, because this is good news for all the CIONET members in any country. The bigger the family, the more value we can get and give, the more we can achieve all together in the ICT sector, the more we can learn from each other.
We are working hard to make this a success for all of us, but we need your help. You can contribute to the growth of our family by proposing new members in any of these Latin American countries: Colombia, Mexico, Brazil and Peru. We are sure you know some peers in these wonderful areas and we are sure they would love to be part of our ‘VIP Club’. Now that you know our expansion plans, help yourself and your peers to make it the best place in the world for sharing and caring. Please send the contact information of potential members you know to anyone of the CIONET team in your country. We will invite them on your behalf. And, of course, if there is anything CIONET can do for you on the other side of the ocean, just let us know. Good luck to all the new countries!
This article was written by Mona Biegstraaten, President of CIONET Spain and Latin America.
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IT is becoming increasingly more important for a future-proof enterprise design.
Digital leadership in times of change Of course every CIO puts innovation high on the agenda. Logical, because every organisation wants to be progressive on paper. But how do you ensure that a simple text on a motivational poster actually penetrates into the DNA of your organisation? How can you as CIO play a pioneer role in making your organisation future-proof? Dion Kotteman, CIO of the Dutch Government: “Organisations are not clear-cut entities any more. They have become networks.”
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These questions were central during the CIONET meeting ‘From CIO to information professional 3.0’ on 3 July 2014 in Hoofddorp, the Netherlands. The rustic views of the water and the Haarlemmermeerse wood made a pleasant contrast with the turbulent times that information technology is currently experiencing. Fast moving innovations ensure that IT has increasingly more responsibility in the futureproof design of enterprises.
CIO of the state (Dutch Government) regularly has to account for IT projects at the Government. Especially when the state has recently been much in the news for various failed IT projects. “The media have recently been presenting a distorted view of this”, Kotteman says in his own defence. “In the past, mistakes have been made in Government projects but this hasn’t been the case anymore over recent months.”
Talk show
Kotteman, who previously worked for Rabobank, ING and ABN Amro, recognises that anticipating change in the past sometimes happened too late. “It’s good to have business experience when you work for the Government. It enables you to see that things can sometimes go much faster. The Government sometimes anticipates developments too late when the trick is to see these developments in advance and take the relevant measures immediately.
The meeting took on a slightly different tone than it would normally have done. Instead of the usual presentations CIONET’s Herman van Bolhuis acted as a talk show host. Arjan van Dijk, IT manager of Stadgenoot and honorary member of the VRI (Association of Registry IT Experts), assisted him in asking critical questions. The first guest was quite used to being firmly questioned. Dion Kotteman as
Co-creation The CIO emphasised that the state is increasingly looking for cooperation with market parties. “Organisations are not clear-cut entities anymore. They have become networks. Tasks are being outsourced and insourced, also at the Government. We are the largest collector of big data but the management of all this information does not need to be done by the Government. We want to bring this task to the market. We are also looking at innovation beyond our own walls and for opportunities for co-creation.” Arjan van Dijk stated that Government projects often go through a long tendering process allowing many different parties to join the bidding. Isn’t that overly democratic? Kotteman understood where this question came from. “As a Government we sometimes went a bit too far with our democracy and transparency. But it is legally required that we work on the basis of calls for tender. Perhaps we could create a set of criteria determining whether parties may join the bidding or not.” In the search for new people Kotteman has an ambitious but realistic approach. “We want the best experts but need to look at our position as a public authority. We do not pay very much and we have chosen for a small government in the Netherlands, which means our organisation is shrinking. Employees must, of course, be good at their job but they also have to be substantially involved in our social mission.”
Internal incubators The next speaker was Frank Vogt. As COO of Wegener he is responsible for a number of operational departments such as printing, distribution, operations and IT. Vogt outlined the violent transition that its core business, the media, is currently experiencing. “We once had 8,000 employees, now there
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are only 2,000 left. The media sector is going through major changes. So we must innovate throughout. This is a marvellous setting for an IT professional but it is not a really secure job.” Wegener is therefore making the choice to hire many new young people to stimulate innovation. Vogt: “You have two speeds in IT. You have to keep your current processes running smoothly and at the same time consider how you want to change them. You don’t want to make the distance between the transforming department and the dying department too big. We have an IT Department and an Innovation Department. These are two different worlds but we try to bring them together. By selecting new people more on social skills, for example. They must be able to communicate, direct and connect.”
The trick is to see new developments in advance and take the relevant measures immediately.
A CIO attending the meeting added: “You can develop innovative ideas via internal incubators and then try them out for three months. If it is clear at the end of these three months that an idea does not work, throw it out. As an organisation you should have these guts. You have to stimulate innovation but do not keep on trying this endlessly if you don’t meet with any success.”
Outward bound “Wegener also looks emphatically outward in its urge to innovate”, says Vogt. “We are putting our stakes on digital leadership. We are very well informed about regional news events. This distinguishes us as a news organisation. We want to excel in this area but it is not necessary to organise the implementation ourselves. When a market party is better at it, we turn to them. This goes beyond a traditional client-supplier relationship. We then really develop a long-term relationship with this party.” This article was written by Melvin Captein.
Frank Vogt, COO of Wegener: “You have to keep your current processes running smoothly and at the same time consider how you want to change them.” (Copyright photo: Koninklijke Wegener NV) Arjan van Dijk, IT manager of Stadgenoot and honorary member of the VRI: “Government projects often go through a long tendering process. Isn’t that overly democratic?”
CIONET Netherlands EVENTS
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CIONET Italy has honoured three CIOs for their innovative business projects.
CIONET ITALIA AWARD 2014 Pierluigi De Marinis (l.), Donatella Paschina (m.) and Marco Moretti (r.).
Once again, CIOs have distinguished themselves in the Italian scene as actors for innovation inside their companies. Pierluigi De Marinis (ANAS), Marco Moretti (GDF Suez Energy) and Donatella Paschina (Zegna Group) are the Chief Information Officer winners of the third edition of the CIONET ITALIA AWARD in the Technology Driven, Client Driven and Strategy Driven categories. They received the award during a crowded press conference in Milan. The well-known Italian Award, during its third edition, is organised and promoted by CIONET Italy. The award is dedicated to the Italian CIOs of large and medium organisations. The prize is awarded each year, in the categories of Technology Driven, Client Driven
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and Strategy Driven, to three Italian CIOs who have carried out projects with a strong impact on competitiveness and innovation inside their organisations.
Technical Jury The Technical Jury of the CIONET ITALIA AWARD 2014 edition designated the three winners from among 53 projects submitted online. The Jury was composed of nine leading members with an IT, economic, business and media background. We would like to take this opportunity to express our gratitude to Guido Albertini, Central Director of Information Systems and Digital Agenda at the city of Milan and
winner of the CIONET ITALIA AWARD 2013 edition in the Technology Driven category, Paolo Ballabene, IT Director at TNT Global Express and Winner of the 2013 edition of the CIONET ITALIA AWARD in the Client Driven category, Giuseppe Cerbone, Chief Managing Director and Chief Executive Officer at ANSA, Marcello Cordioli, Global IT Officer at Lixil, CIO at Permasteelisa and winner of the 2011 edition of the European CIO of the Year in the Business Process Driven category, Giovanni Damiani, Vice General Director at the Central Institute of Italian Popular Banks (ICBPI), Alfredo Gatti, Managing Director at CIONET Italy and Managing Partner at NEXTVALUE, Daniele Panigati, Informatics & Logistics Director at Roche and Winner of the 2013 edition of CIONET ITALIA AWARD in the Strategy Driven category.
Winning projects The Technical Jury has selected the best project for each of the three CIONET ITALIA AWARD categories and named as winner the Chief Information Officer who led the project together with his or her team. In the Technology Driven CIO category the winner is Pierluigi De Marinis, Director of the Central Information
From left to right: Guido Albertini, Central Director of Information Systems and Digital Agenda at the city of Milan, Pierluigi De Marinis, Director of the Central Information Systems and Equipment at ANAS, Donatella Paschina, CIO at Zegna group, Samantha Turrin, Senior Manager, Southern EMEA at LRS, Marco Moretti, ICT Head of GDF Suez Energy Italy and Giovanni Damiani, Vice General Director at the Central Institute of Italian Popular Banks (ICBPI). The three other finalists of the CIONET ITALIA AWARD 2014: Antonio Sannino, IT Director & Share Services at P&G Italy (l.), Antonio Lovascio, ICT & System Integration Director at Comer Industries (m.) and Armando Laurenti, CIO at Bulgari Group (r.).
Systems and Equipment at ANAS. “I am proud to receive this prestigious award dedicated to women and men working at Anas”, said De Marinis. “The project is an important step towards the path of innovation of the Information Technology concept. The aim of the project is promoting the use of mobile tools to simplify activities and operations on the road, digitise the paper flow management and provide top management with a tool ‘at your fingertips’ for consulting real-time data about the road network.” In the Client Driven CIO category the winner is Marco Moretti, ICT Head of GDF Suez Energy Italy, “The project contains elements of innovation both on the business side and on the IT side”, Moretti commented on the award stage. “I am proud to receive
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this recognition for a project that is in fact the first multi-channel CRM Cloud in the competitive energy market, conducted in parallel with the start-up of NewCo and the consolidation of GDF Suez in Italy.” In the Strategy Driven CIO category the winner is Donatella Paschina, CIO at Zegna Group, who commented: “I am really pleased to receive this award, which I dedicate to the six Generation Y co-authors of my team. A very complex project focused on the shop. With our IT project we have created a completely new set of tools for managing the complexity of the store, from customer relationship management to back-office processes.” Among the six finalists of the CIONET ITALIA AWARD, 2014 were the projects presented by Armando Laurenti, CIO at Bulgari Group, by Giuseppe Lovascio, ICT & System Integration Director at Comer Industries, and by Antonio Sannino, Director of Information Systems & Shared Services at Procter & Gamble Italy.
Red carpet “The 2014 edition of the CIONET ITALIA AWARD has been particularly interesting for the scale and the economic
dimension of the projects submitted. More than 53 Innovation projects with an IT budget of not less than 500,000 euro”, said Alfredo Gatti, Managing Director at CIONET Italy and Managing Partner at NEXTVALUE. “The CIONET ITALIA AWARD is the ‘red carpet‘ of Italian Information Technology. This is a unique Italian contest to discover the lines of innovation in Italy, to monitor the emerging IT trends, and to assess whether and how the CIO is able to support his or her organisation in the development and implementation of business processes and organisation. The CIONET ITALIA AWARD has become, in a few years, the most eagerly awaited award by the community of the Italian CIOs”, he went on. The main sponsor of the CIONET ITALIA AWARD 2014 was LRS. CIONET Italy thanks Samantha Turrin, Senior Manager, Southern EMEA, who presented the Awards. The CIONET ITALIA AWARD is a fundamental activity instigated in 2010 by CIONET Italy to promote the excellence of the Chief Information Officer of the top Italian companies. See you next year for the CIONET ITALIA AWARD 2015.
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CIONET Germany has launched a new series of regional networking events.
Be where your members are
From l. to r.: Tobias Frydman, Founder of CIONET in Germany, Dr. Helmut Meitner, Michael Maretzke, Dr. Frank Sarre, Thomas Henkel, Thomas Singbartl and Robert Mayer.
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Time is probably a CIO’s most important asset. And while spending time with peers it is important for IT leaders to enable sharing of experiences and exchange ideas. The time spent on getting to the event venue and back to the office is an important decision criterion in a big country like Germany. Based on feedback CIONET Germany has received from its members, the organisation is now starting a new series of regional events, hosted by individual members and addressing the issues of the local groups. The formula is simple: reduce travel time, increase time for discussion and networking with peers from the region and benefit from the CIONET community by visiting colleagues’ companies.
Bavaria The starting point of this new series of CIONET events was Munich-Geiselgasteig, where members met on 2 July 2014 at the famous Bavaria Film Studios. The host, Thomas Singbartl, Head of IT of Bavaria Film offered attendees a special treat: an exclusive tour of the Bavaria Film Studios. All attendees confirmed the value of this new formula. They created a
CIONET Germany will post the results of each session on the member part of cionet.com. list of topics that will be discussed in the next Bavarian CIONET meetings, which will be interesting and relevant for other members too. To enable other members to join the discussions and to share ideas and solutions, CIONET Germany will post the results of each session on the member part of cionet.com. For the most important topics the organisation will also arrange countrywide sessions (either online or offline).
‘All attendees confirmed the value of the new regional formula.’
SIG Industry 4.0 In addition to the new regional offering, this summer CIONET will launch a new German special interest group, focusing on all aspects of ‘Industry 4.0‘. This new SIG will be co-hosted by one of the advisory board members as well as by an experienced industry analyst from a leading research company. CIONET Germany invites its members to join this SIG and participate in thought leading peer exchange.
Next stop CIONET Germany is also happy to announce its first regional CIONET meeting in Hessen (Frankfurt region) on 18 September 2014. The topic to be discussed is ‘Success factors of agile IT project management‘. CIONET is looking forward to welcoming IT leaders from the region - and beyond of course too. CIONET regional is the latest addition to the program of CIONET Germany networking events. CIONET will continue to invite German speaking CIOs to its events in major German cities and will add new formulas and services to meet the expectations of its members.
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Interested in joining or hosting a regional session? CIONET Germany invites German CIOs to participate in these regional series by either attending the events or by hosting one of these gettogethers. It is a unique opportunity to share ideas with colleagues and to give them the chance to look behind the scenes of each other’s IT. It also offers a great return on investment as the time investment as a host is very limited. CIONET Germany also invites its business partners as well as start-ups to host individual regional sessions and to present their CIO level visions and solutions to its members. If you are interested in playing an active role in CIONET Germany’s new member offering, please send an e-mail to: tobias.frydman@ cionet.com or ulrike.rosina@cionet.com
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Cybercrime causes many concerns but it can also lead to value creation.
Value destruction or creation? Cybercrime causes many dilemmas for the CIO. In particular when a system gets hit there are many concerns about how to manage this. On the other hand, cybersecurity can also be regarded as a service creating value for the company and its management.
Luc Beirens, Director Cyber Security Services at Deloitte Belgium: “Securing cyberspace costs much more money and time than attacking it.”
Jan Nys, Chief Risk Officer ICT at KBC Group: “A risk-based approach enables management to focus the investments on the most needed cyber measures.”
Cybercrime has some specific challenges. “It’s asymmetric as securing cyberspace costs much more money and time than attacking it”, explains Luc Beirens, Director Cyber Security Services at Deloitte Belgium, former Head of the Belgian Federal Computer Crime Unit. Cybercriminals dispose of many tools and beginners’ toolkits are easily available. When they’re offered as a service the criminals control all the user information relating to their subscribers enabling them to provoke large scale infections. Another contemporary challenge is the invisible high-end malware used by secret services. “When a system is hit by malware, do you call in external help? Often your ICT providers don’t even recognise the problem thinking it’s a software problem. And how do you deal with the infected system? If you shut it down you lose traces that are in the RAM. If you reinstall it you overwrite
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the evidence. Do you give a sample of the malware to an expert community? But wouldn’t that be bad publicity? Perhaps the best solution is to work with just one specialised expert company.” These are just a few examples. “Cybersecurity also involves many other dilemmas. Do you pay in case of extortion? Do you inform the authorities? Do you inform your employees? Your customers? Etcetera”, Beirens concludes.
‘The challenge is to create value by offering security services.’ Value creation Jan Nys, Chief Risk Officer ICT at KBC Group: “The evolution of cybercrime has persuaded us to start an enhanced reinforcement program called Cyber The Next Gear Program. The goal is to get cyber defence onto
Raise awareness Prof. Jean-Jacques Quisquater, Security Advisor at Intopix and professor at UCL: “You have to realise that commercial spying and large targeted attacks exist. A lot of commercial software may contain a ‘back door’. This is an imported function in software to bypass normal authentication, sometimes created at the request of governmental institutions.” Quisquater also points to the RSA threat. RSA is a widely used
a high level for all companies within the group. We’ll report the status of the program for the different entities to KBC Group’s Executive Committee. The program will embed business ownership for cyber risk in all of the group’s companies.” The challenge is to create value by offering a series of security services to the KBC Group companies, for example propagation of actionable cyber intelligence, distribution of best practices, definition of policies and standards, cyber risk training, proactive cyber defence, forensic analysis of compromised services, crisis management, etc. Another example is the Ethical Hacking Service, where the attackers are an external expert team. “The value of this approach for management lies in the risk-based method enabling them to focus the investments on the most needed cyber measures. The approach provides them with more insight into the cyberthreat landscape, reporting at the level of cybersecurity domains, a view on the current and expected situations and it is repeatable - enabling them to see the evolution”, Nys explains.
public-key cryptosystem for secure data transmission. Crypto experts believe the RSA algorithm may be broken over the next few years. “We have to raise awareness”, Quisquater continues. “Remember Y2K? Disaster scenarios are needed, as well as new models for security taking into account backdoors and malwares. This is a new domain for research and application development. Organisations have to
Agency): “In 2012 we implemented the NCIRC FOC project upgrading NATO’s cyber defence significantly to meet current and anticipated threats.” But cyberthreats are constantly evolving and technologies change. So what’s next? Wilhelmsen: “We plan a second phase of the project deploying alternate capability and completing the Cyber Defence Decision and Support System. Moreover the ITM project (IT modernisation) will deliver over 50 enhanced security measures which will provide further centralisation of cybersecurity services, improved cyber resilience, standardised security configuration and identity management capabilities.” “We are working closely together with allies, military commands and the industry to develop a continuous cyber resilience programme”, Wilhelmsen continues. “NCI Agency actively collaborates with the industry through the Industry Advisory Groups NIAG and AFCEA and the organisation of collaborative events. It also supports multinational Smart Defence Initiatives such as MNCD2, MISP (Malware Information Sharing Platform) and NCDCP (NATO Cyber Defense Cooperation Platform).”
examine how existing systems will handle future suites with longer keys, multiple passwords, etc. They will also have to build new systems that support rapid key rollover and are plug and play with multiple crypto schemes.” “Finally, organisations need to develop a secret protecting mindset actively securing sensitive systems and communications”, he concludes.
Dag Wilhelmsen, Director Infrastructure Services at NCI Agency: “We actively collaborate with the industry through the Industry Advisory Groups and the organisation of collaborative events.”
Prof. Jean-Jacques Quisquater, Security Advisor at Intopix and professor at UCL: “You have to examine how existing systems will handle future suites with longer keys, multiple passwords, etc.”
Industrial collaboration Dag Wilhelmsen, Director Infrastructure Services at the NATO Communications and Information Agency (NCI
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This article is based on the CIONET Belgium Networking Event ‘Value Creation with Cybersecurity’ held on 27 February.
CIONET Belgium EVENTS
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To continually improve their business in the digital age CIOs must take a risk.
How can you prove the value of IT? Innovation is much talked about but frequently misunderstood. At a recent keynote event, Professor James Woudhuysen discussed with CIOs how they can work to unlock the value of IT. James Woudhuysen is professor of forecasting and innovation in the School of Design at De Montfort University. His conversations with attending CIOs through the event in London suggested there are three sources of innovation: a change in product, a change in process or a change in organisation. Frequently, innovation involves all three. Below, we present five key points emerging from the discussion. First, leadership is hugely important to innovation. While passion is good, there are times when you should also be dispassionate. “Get distance from the fluffy stuff. There will be times when you have to kill some sacred cows,” said Woudhuysen. Great leaders inspire their teams. Woudhuysen encouraged CIOs to be idealistic and humanistic. “Go to the people that do the real work as they can give you massive insight into what is and isn’t working,” he said. Second, Woudhuysen described the classic innovation culture, where senior executives set challenging targets, overcome resistance and demonstrate a willingness to take the
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lead. While failure can provide valuable lessons, nobody gets rewarded for getting things wrong. CIOs should be prepared for resistance, so IT leaders should have a sense of ambition and a willingness to take on an initiative. This openness can be a risk, but curiositydriven research is needed for innovation to flourish. The CIO should set an example and show courage in the face of a challenge.
Generating curiosity Third, CIOs should be curious when they focus on innovation and discovery. Business is different from a research lab, as the focus in business tends to be on applying known methods to new situations, whereas labs seek new knowledge. CIOs should not be afraid of generating curiosity in their teams. You are more likely to be successful if you have a team that is curious. Woudhuysen advised CIOs to bring young people into the business. They will question operations in a pragmatic way. Fourth, CIOs must beware of the fake benefits of IT. It is important to avoid the use of clichés and acronyms to try and get people onside. Also, do not be
blinded by the significance of the next generation of users. Being able to use an iPad is not the same as understanding how a processing unit works. If you talk too much about your children using an iPad, you are in danger of dumbing down the real power of IT. Finally, it is very important to recognise the real benefits of IT. Technology is now easy to use. Ease of use means new tools and apps spread through an organisation quickly, enabling more people to do things faster and cheaper. Cloud services allow SMEs to compete with larger companies through the use of software that would have been beyond their reach previously. Lower entry barriers change the nature of competition.
James Woudhuysen, professor of forecasting and innovation in the School of Design at De Montfort University.
What’s the point of your digital strategy? Many companies are aware that digital is a massive opportunity but are unclear how to leverage the five disruptive technology forces - mobility, cloud computing, social business, analytics and cyber intelligence - reshaping the marketplace. Reimagine your place in your ecosystem, redefine your products, services and experiences, and retool to engage stakeholders more effectively. From strategy to delivery, Deloitte Digital combines cutting-edge creative with trusted business and technology experience to define and deliver digital solutions Make a point of visiting www.deloitte.com/be/technology
Š 2014 Deloitte Belgium
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CIONET Luxembourg CIO VISION
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To be successful in the new era the Digital Leader has to adjust his skills.
The Digital Leader’s role Does your company have a real Digital Leader? Is he or she doing a good job? What should be the goals of this new leader and where should we position him or her in the organisation?
Blake Cahill, Global Head of Digital and Social Marketing at Philips: “Effective leaders are not just experienced in their own fields, they also have a thorough understanding of their colleagues’ domains.”
This role is very new (and needed) for all of our companies. In order to succeed as a Digital Leader, you need to adjust your leadership skills to adapt to today’s digitally open world. We have asked Blake Cahill, Global Head of Digital and Social Marketing at Philips, some interesting questions to which we should all know the answers. How can you be an effective leader in the digital world? “Effective leaders are not just experienced in their own fields, they also have a thorough understanding of their colleagues’ domains. As the importance of technology across the entire marketing and communication arena is increasing, a company’s CDO (Digital Leader), CMO and CIO must share a real understanding of the wide technology backbone that can enable one-to-one marketing, service, realtime interaction and content delivery as well as the advanced analytics applications that are becoming ubiquitous today. Each of these roles must understand increasingly more about each other’s specialties.”
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Is a more collaborative environment one of the goals of the Digital Leader? “As the roles of the CMO, CIO and CDO begin to move towards each other, I believe this should start happening naturally.” Which profile is the best to choose as the new Digital Leader in a company? “Digital is not something that is confined to a marketing or communications function. For example, at Philips Digital has a role in this area but it also has the potential to digitise the business, the processes and the way we work. It also has great potential in the development of new business models. This means that Digital Leadership can really develop from any area of the business.”
Digital Leaders’ influence IT departments can no longer be treated in isolation, nor can technology be regarded as a discrete business area. Digital permeates the whole organisation and impacts all phases of the value chain.
Defining and implementing digital should be applied horizontally across the whole business. How far does your influence as the Digital Leader reach in your organisation? “As the Global Head of Digital & Social Marketing, I report to the Executive Vice President, Global Head of Brand, Communications & Digital. We have spent the past year working on a global Philips business transformation and rebranding. Part of this has been the shift of digital into a well-integrated segment running across every area, overseen by myself and the Global Head of Brand. This shift has meant that digital has become more valued throughout the business. As far as I’m concerned this is the ideal scenario.” What are the main responsibilities of your role? “In my role as Head of Digital at Philips, I focus on building, delivering and supporting the digitisation of the brand across our Business Groups and Markets, specifically with regard to digital capabilities, policies, and bestpractice sharing in order to drive consistency for our customers in all the domains of digital. Additionally, there are a number of global digital properties that my team manages in terms of interaction between Philips and our brands – across social media, the web and various mobile applications.”
Translate into business Digital leaders need to understand the behavioural, economic and social
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shifts that new technologies such as mobile, social networks, cloud and big data are creating. They have to translate these fundamental shifts into business changes at the industrial, organisational and individual level.
‘Digital Leadership can develop from any business area.’ Could you explain how to get this big job done? “One of the major challenges for brands when they’re defining and implementing digital is that it should be applied horizontally across the whole business, whereas most organisations are structured vertically. Attempting to create a successful vertical digital function will fail, so this must be addressed before any major business changes can be implemented. Many people consider digital as an additional element to their business and add new digital processes and roles that don’t harmonise with the rest of the organisation. To overcome this challenge, we began by defining exactly what digital means for Philips, and then used this to define our entire approach. This sounds obvious but digital is an amorphous term and can mean many different things to different audiences.”
Big data Perhaps the biggest step to take in crossing the digital divide concerns the issue of big data. Understanding how to transform big data into decisions that improve business performance should be at the top of every executive agenda. How is your company currently taking advantage of big data? “I have no doubt that data analytics will one day help us to make great strides in many aspects of our lives and businesses. Today we are accumulating data at exponentially increasing rates but analysing and deciphering exactly what’s important and what isn’t is still a very young science. I expect that in another five years, we’ll be considerably more experienced in providing valuable insight. Currently some benefits are already apparent. For example, in my team we carry out social media monitoring at a global scale on a wide variety of topics: from reputation management and brand perception to product launches, customer sentiment and competitor tracking. This enables us to collect insights and provide qualitative and quantitative insights on each topic for the ultimate benefit of the business.”
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A stronger relationship between the CIO and HR responds to the challenges of digital transformation.
When the CIO meets HR How do CIOs and CHROs work together today? What are their main challenges and where is their relationship going? How can you strengthen the digital culture in a company and increase the competitive ability of companies in Italy and abroad? “A closer cooperation between the CIO and HR has been and remains one of the essential enablers to empower the ability of our companies to do business”. This was the highlight of the CIONET Italy annual event ‘CIO meets HR’. The event took place in Milan on 15 May 2014. More than 40 CIOs and IT Directors from top Italian companies were present at this first Italian event on the relationship between the CIO and the CHRO. The panel of top level CIOs and CHROs invited by CIONET Italy to share their experiences on the CIOHR relationship, pointed out the need to make their relationship closer and stronger.
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Three challenges are appearing in the radar of the CIO-HR relationship: globalisation, the increasingly borderless company ecosystem and the digital native generation that is coming into their companies. In order to be the main players in the Cultural and Digital Transformation inside and outside the company and to support companies to deal with the global transformation in business, culture and socio-economic environments, the only way is collaboration.
Keynote speakers We take this opportunity to express our gratitude to the six keynote speakers of this annual CIOsummit: Bruno Conti, HR Director for Management Services (Finance, IT, Legal, Institutional Affairs & PR) and Supply Chain at Ferrero Group, Paolo Daperno, CIO & Business Process Director at illycaffè, Pierluigi De Marinis,
Director of the Central Information Systems and Equipment at ANAS, Mara Maffei, Manager IT at Heineken Italia, Marco Moretti, ICT Head of GDF Suez Energy Italy, and Maria Elena Scardigno, Internal Communication Manager at Magneti Marelli. A special thank you goes to Andrea Del Miglio, Partner at McKinsey, who introduced the theme of the summit with a major presentation focused on IT talent management in the digital age. We also give our thanks to Enzo Bertolini, Group CIO at Ferrero and President of the CIONET Italy Advisory Board for his passion and his commitment to the success of this event and the entire CIONET Italy annual program, along with all the members of the Advisory Board for their support and participation in all the activities of CIONET Italy.
Enzo Bertolini
Bruno Conti
Paolo Daperno
Pierluigi De Marinis
Andrea Del Miglio
Mara Maffei
‘CIOs and CHROs need to make their relationship closer and stronger.’ Marco Moretti
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Maria Elena Scardigno
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CIOs must focus on stable operations at the same time as they support business growth.
A veritable balancing act
CIO Anita Gjesbakk (l.) and CEO Per Waage (r.) of the Norwegian National Collection Agency (NCA) at the 2014 award ceremony for Norway’s IT Department of the Year/CIO of the Year. (Copyright photo: Ahlert Hysing)
According to analyst firm Radar in a recently published survey, the new challenge facing CIOs is a veritable balancing act. Their point is that CIOs must focus on stable and efficient operations at the same time as they support the growth of their businesses. Norway’s National Collection Agency (NCA) has proven beyond doubt that finding that balance is not the only act they have in their repertoire. The Norwegian ‘Statens innkrevningssentral’ (National Collection Agency NCA) collects money on behalf of the Norwegian state. More specifically, the Agency deals with 193 different types of claims for 35 different clients. The claims the Agency collects for them total an amount of 3.8 billion NOK (0.45 billion EUR). To find out more about their approach we paid a visit to the NCA where we spoke with NCA’s CEO Per Waage and its CIO Anita Gjesbakk.
Act on the facts
‘Gartner rates NCA with a score of 3.0 in maturity, whereas the average is 2.7.’
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We were shown what parameters they use to manage their business. Thanks to the simplicity of these parameters we understood soon that efficient operations are reflected in the figures they present. A core parameter is the
cost of collecting one Norwegian krone. When the cost is only 0.06 NOK per 1,000 NOK collected, it may seem that NCA simply prints banknotes for the Norwegian state. The eight other parameters, which are quantitative, clearly reveal an ambition to achieve efficient operations. Gartner rates NCA with a score of 3.0 in maturity, whereas the average is 2.7 and other public agencies only score 2.4.
Digitisation and dialogue An interesting aspect of such an efficient system of debt collection is the use of social media and the combination of public information. That’s not something you would expect to make the amount of collected money increase, but it’s certainly more correct.
What this means for debtors is that their monthly payments are lower because NCA has developed a system that shows their ability to pay rather than just their income and regular deductions. Perhaps this is a useful idea that banks might consider for their credit rating systems?
Soft values Per Waage addresses a lot of topics with pride, and rightly so. In 2012 NCA has received the Norwegian Computer Society’s Rosing Award for userfriendliness. In addition, NCA received a silver medal in the 2013 Farmand Award contest for the best public-sector website. The focus on user-friendliness and customer dialogue comes across clearly on their website, where the slogan ‘Det finnes alltid en løsning‘ (There is always a solution) appears on every page.
IT Department of the Year/ CIO of the Year NCA has also won the 2014 award for Norway’s IT Department of the Year/ CIO of the Year. The award is organised by IDG/Computerworld in partnership with CIONET. Analyst company Radar, which assisted the jury in evaluating the nominees, highlighted three of NCA’s qualities: -- IT budget: the IT budget accounts for 38% of NCA’s total budget, indicating that NCA is a very ITintensive enterprise;
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-- IT efficiency (distribution of the IT budget between operations and changes): a large proportion of the IT Department’s deliverables consists of changes. Sizeable investments were made in 2012, but the rate of change in 2011 was also high. A high rate of change that leads to genuine business improvements is characteristic of a worldclass IT organisation; -- IT realisation: the distribution of costs between hardware, software and services shows that NCA has a large proportion of services, which is in line with the desired trend for the industry in general.
Anita Gjesbakk was nominated as a finalist of the European CIO of the Year 2014 awards. The ceremony took place at the CIO City 2014 event in Brussels.
‘The IT budget accounts for 38% of NCA’s total budget.’
Visions for the future Another interesting point about Per Waage’s balancing act is NCA’s participation in the Innovation Forum Norway, where the focus is on innovation in a globalised world, and Per’s membership of several advisory boards of international IT developers and suppliers, where the focus is on technology and development. This really requires being able to focus on two things at the same time. This article was written by Jens Petter Mathisen, General Manager of CIONET Norway.
NCA’s debt collection system makes use of social media and the combination of public information.
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Regard the digital revolution as a real opportunity and take advantage of it.
Digital Leaders integrate all the players The digital revolution has moved outside of the boundaries of the IT department. According to Philippe Poirson, the new CIONET France AB President, the new CIO has to federate all the old and new stakeholders of the IT ecosystem, both inside and outside of the company. Philippe Poirson is 53, married and a father of four children. Currently he is Corporate CIO at Geodis, a global operator in the supply chain evolving in more than 50 countries. The company is a specialist in transport and logistics solutions. It is one of the major operators in Europe. After a double training program in IT and management at a business school, Poirson worked in various activity sectors: telecommunications, IT services, retailing and transport & logistics. He has held various positions within companies which enables him to clearly understand the wide range of business challenges that IT management has to take up. Starting as head of studies, then salesman at a computer manufacturer, he then held marketing positions within large groups. He was consultant at Capgemini, program director at Carrefour and organisation & logistics director of a Carrefour business unit. Finally within Geodis, first he was the Geodis Calberson CIO and then the Corporate CIO.
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What are your main missions as Geodis Corporate CIO? “I am dealing with a transversal function within the organisation, serving the group support functions and the IT division management. With my team, we focus on two main missions: we are realising and operating solutions and services for the different group support functions, such as finance, HR, purchasing, sustainable development, etc. We also deliver shared solutions and services to the IT division management in the domains of EDI, intranet, extranet, collaborative systems, repositories, CRM and BI. Our goal is to provide solutions and services focusing on operational excellence, cost efficiency and transforming technological innovations into business advantages.”
‘We transform technological innovations into business advantages.’
CIONET community What were you looking for when joining the CIONET community? “I have been a member of CIONET for four years and I’m a member of the CIONET France Advisory Board. I was looking for an organisation that could connect the different IT players, a community that would enable me to communicate above current themes and to share feedback on CIO challenges. I was also looking for an organisation that could differentiate itself by its innovation capacity, its openness for seeking ideas together with start-ups and lastly, a community willing to meet members’ expectations. That is what CIONET is giving me.” How about your priorities as the new CIONET France AB President? “As the CIONET France AB President, I would first like to get closer to my peers’ concerns by listening to their expectations and needs. On top of this, I would like to develop a prospective approach to highlight future digital transformation and IT
Philippe Poirson, Corporate CIO at Geodis and CIONET France AB President: “The CIO becomes the conductor of the IT transformation and expansion process. He is the innovation catalyst.”
solutions. And finally, I’ll play a part in improving the community environment by increasing the numbers of partners, contributors and members.” What important trends do you observe in the evolution of the CIO? “Today, CIO’s have to face up to a need for real mutation, due to the numerous technological innovations (Big Data, mobility, digital transformation, …) and the need to spread their ecosystem over new IT fields ( Cloud, Saas, aPaas, …). The new CIO needs to be open to innovation while staying focused on operational excellence and cost management and to be close to his new partners by seeking the best offers, even if this represents a substantial challenge.” Let’s start with big data. What are the main challenges? “Big data is a value creation opportunity for companies enabling them to make use of all their internal data and the various available external data sources. It’s a new opportunity to use information in a predictive way and to discover new application fields which are still unknown today. However, as for any data science, big data highlights the question of information quality, its credibility and its management. This point is fundamental when talking about big data.”
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What are the main challenges involved in the cloud? “The cloud has become an operational reality with which the CIO has to create his services offering. It brings flexibility and stability for system scalability, accelerating deployment into new geographical areas. It also accelerates the availability of new services and makes it possible to analyse market evolutions. From an economic point of view, it makes an Opex model easier to put in place. However, it is important to manage security, coherence and integration within the existing company IT system.”
’The cloud brings flexibility and stability for system scalability.’
as partners, not competitors. The IT department is becoming more transversal, with a coordination and architect role. Fundamentally, it will always be responsible for the functioning of the company’s IT security.” What are the consequences for the CIO? “The CIO becomes the conductor of this transformation and expansion process. He is the innovation catalyst. He has to federate all the stakeholders of the IT ecosystem, both inside and outside of the company. He also has to transform himself to become a value generator for the company, ever closer to the business.” This article was written by François Samarcq, General Manager of CIONET France.
Outside the boundaries The digital revolution has moved outside of the boundaries of the IT department. Do you believe the CIO may be overrun by this evolution? “The CIO could take advantage of this and regard it as a real opportunity. The IT department needs to open up to its new ecosystem. It needs to be open to new cloud solution offerings, new roles for IT functions and the colleagues’ innovation capacity. It needs to integrate all these players
Big data highlights the question of information quality, its credibility and its management.
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Strong partnership between business users and IT boosts growth.
Business-focused IT Liberty Seguros streamlined and automated end-to-end business processes for thousands of stakeholders. IT proved to be able to address new needs in very aggressive times and boosted Liberty’s growth. Liberty Seguros is a leading insurance company and part of the Bostonbased Liberty Mutual Group, a global insurer and the sixth largest property and casualty company in the United States. Liberty Seguros started in Portugal in 2003 and directly employs close to 500 people.
End-to-end solution We had the ambitious vision to connect every single department and external partner through one unique
end-to-end solution that placed the customer at the core of operations and analytics. Achieving this goal would be an enormous task. First of all, Liberty had inherited a network of systems and applications from a previous merger and acquisition. Also, all IT had to comply with the procedures and standards of Liberty Mutual’s headquarters and the business strategy required us to extend our core processes to our agents. Moreover, Liberty has a wide range of external partners: customers, experts, agents, auto repair shops and more, all of them involved directly in the company’s activities. At the same time, we needed to support tactical business needs through the creation of departmental micro applications and we wanted to increase the average lifetime of our applications to more than 4 years.
Liberty Connect Eduardo Romano, CIO at Liberty Seguros: “Our Liberty Connect platform has become business critical, supporting over 4,000 internal and external users.”
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It has been ten years since the first application in Liberty Connect went live. Nowadays, Liberty Connect manages multiple business processes. It
supports over 4,000 internal and external users, runs on a cluster of nine front-ends, and includes integration with all record systems. Liberty Connect has become business critical. One of the most important success factors was the choice of the development partner. We decided on the platform that granted us the ability to integrate and extend the existing back-end systems and to create innovative front-ends, while assuring the flexibility to maintain and change applications whenever needed.
‘We wanted a solution that placed the customer at the core of operations.’ Strong partnership Over these ten years we have gone from a market share of 2.8% to 6.4% and the strong partnership between business users and IT was largely responsible for this. IT is able to address new needs and adapt to new requirements in very aggressive times maintaining Liberty’s competitiveness. We wanted to be an easy company to do business with and we did it with the help of IT. This article was written by Eduardo Romano, CIO at Liberty Seguros.
The IT challenges of the public sector are not that different.
Early adopters It may not be commonly known, but very often public sector organisations are early adopters of new technology and hence an interesting client group for ICT-suppliers.
Jürgen Renfer, CIO Public Insurance in Bavaria and Member of the CIONET Germany AB: “Nobody else knows the organisation as well as the CIO with his teams.” (Copyright photo: Christoph Vohler, Munich)
Jürgen Renfer is Head of IT at an insurance company in the public sector, which provides services involving prevention, rehabilitation and compensation of work accidents to around five million citizens living and working in the state of Bavaria, Germany. Their numbers include public servants, volunteers working in social institutions or as fire fighters, pupils and students. In 2012 approximately 245,000 incidents were reported of which 189,000 were accidents involving pupils. Typically, at least in Germany, CIOs of the public sector are not very visible to the outside world. This is for a number of reasons, amongst which are very stringent compliance rules. Having said that, Renfer is a perfect example which demonstrates that it is possible to be a ‘public’ CIO, while applying the rules. He has been a CIO of the Year finalist in Germany on more than one occasion and he is a well known speaker and very outspoken when it comes to the future role of the CIO. And CIONET Germany is honoured that he supports them as a member of their Advisory Board.
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Understanding the Public sector For outsiders, the public sector looks like a very slow, stolid entity, which does not clock up the same speeds as the industry sector. Renfer does not entirely agree: “The public sector as such does not exist. We have very different parts of public administration in Germany, such as municipal and federal state administrations, federal ministries, social security and many others. If you look at the differences, you will see that we are as diverse as the industry sector.” It may not be commonly known, but IT in the public sector started right back in the 1880s, when Herman Hollerith worked as a special agent for the US Census. Since then, the public sector has continued to apply the latest technologies and state-of-the-art methodologies. “Very often we are early adopters of new technology and hence an interesting client group for ICT-suppliers. About a quarter of the yearly ICT-budget is spent by the public sector. The reason for this is very simple: The main task of public administrations is to produce a constant
A public institution’s offering also has to fit the customer needs. outflow of decisions based on the current legal system. Hence citizens expect legal certainty and compliance from these decisions. To come up with this level of decision making, up-todate information is required. For more than 100 years, the most important task of his organisation has been incident prevention. To do this successfully, you need an excellent understanding of the causes of incidents and how they’re changing over time. “For example, in recent years there have been many skateboard accidents amongst pupils. However now, the number of accidents with kickboards is on the rise”. Effective incident prevention needs to reflect the latest trends to address the right audience and topics”. To achieve this, massive amounts of information need to be gathered, processed and analysed constantly over time. Today we call this Big Data, but Jürgen Renfer and his team have already applied similar techniques since the times when mainframes ruled the world.
Know your customers Public sector institutions operate in an interesting environment. Their main focus is to prevent their customers needing to engage with them. Still, according to Renfer it is important to know who your customers are and
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that your offering fits their needs. “The German e-government activities, for example, were initially primarily aimed at our citizens, as it was expected that this group would benefit the most. The interesting thing was that when first user data was available, it showed that citizens had an activity level of approximately 1.3 activities (of which 1 counted for the electronic tax report, which had to be done this way) while companies had an activity level of 100. Nobody expected this outcome and it required a significant change in the approach and focus of our e-government activities”, says Renfer.
‘The public sector is as diverse as industry.’ Betting on the future of the CIO “We, the CIOs have a choice - we can either be the janitor in a grey uniform who changes the bulbs in the basement - or we can be a member of our executive board co-defining the future of our fully digitalised organisations. I am convinced that by 2020, we will see that the latter has become reality for many of us. Today we should master the technology part of IT. Now it’s time to get the information part of IT in our hands by presenting a
successful ride on the digital dragon”, says Renfer. Being confident about this, he has put forward this statement as a bet in Germany’s major CIO publication and has since then been challenged, mainly by colleagues. Renfer is adamant that discussing the woes of the life of a CIO with colleagues will not change the outcome. At one of the CIO CITY 2014 workshops the question was raised how credible you are as CIO. For Renfer “the time of the IT hero is definitively over. We tend to look at the rear of a monitor where the cables come out, but our clients look at the front of that monitor and absolutely do not care about the cables. And in the future they won’t have cables any more, anyway.” “However, if we are able to change our perspective, we are in an excellent position to build credibility. Nobody else knows the organisation as well as the CIO with his teams. Using that knowledge and demystifying the complexity and abstraction of technology so that they become understandable benefits, will make us as CIOs an attractive counterpart for board members. Let’s start thinking and communicating about what IT can do for our organisations and clients and we will be in a good position for the future.”
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CIOs must be open to thinking outside the box when it comes to IT recruitment.
Developing capability in an upturn Ocado director of technology Paul Clarke says a focus on internal staff is the best way to help your business innovate and grow.
Paul Clarke, Director of technology at Ocado: “We really focus on the disruptive edge.”
Director of technology Paul Clarke says Ocado is not a retail business. That might sound like a controversial statement from an executive at the grocery delivery specialist. However, Clarke says it is an oft-repeated
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mantra amongst the firm’s senior team: “We often say we’re a technology business that just happens to operate in the retail sector.” 2013 represented a busy year of growth and transformation for Ocado, including a technology tie-up with supermarket chain Morrisons. The changes lead Clarke to believe that even outsiders to the business now recognise that Ocado is more than simply an online retailer. “Everyone recognises this is a technology operation now”, he says. “We’re open for business. While that’s always been part of the game plan, it does represent an important shift in public perception.” Clarke says this shift in perception is helping to build the idea of Ocado as a technical brand, something that will be crucial as he aims to recruit new talent during the next few years. He says potential candidates are “blown away” during the firm’s recruitment open days. “They have no idea that we build most of our own technology and that there is such a high level of innovation”, he says.
technology we use is very unusual,” he says. “We write virtually everything in-house, whether that’s for web, mobile, middleware, business planning or the real-time tracking of our delivery vans.” A physicist by education, Clarke worked for software consultancies and helped set up dot coms in Cambridge, before entering interim management in IT director and consultancy roles. He initially joined Ocado eight years ago on a one-year consultancy contract. Six years later, he became head of technology. So, why did Clarke end up settling down in a specific organisation?
‘The company was run like a start-up.’
Developing the expertise
“I found a business with an amazing culture and a technology sandpit where people were encouraged to play and experiment. What I saw took me by surprise. The company was run like a start-up and was very innovative. The people in the business were of a very high quality – and working with smart people really matters”, he says.
When compared to some of his executive peers in the retail sector, Clarke says his IT leadership role is much more like that of a CTO than a CIO. “The breadth and depth of
Eight years after joining Ocado, Clarke still retains his passion for the firm. “There’s never a dull moment”, he says. “We launched two
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Innovative thinking has often led to fullyfledged business systems. new warehouses for grocery and non-food items last year. Just when I thought we could draw breath, we signed the deal with Morrisons.” The tie-up means that the high street retailer is now drawing on Ocado’s expertise to launch an online grocery delivery service. The Morrisons deal accounted for a significant proportion of his management time through 2013. The 25-year deal allows Morrisons to take advantage of Ocado’s end-to-end delivery processes, from online ordering to home drop-off. At the same time, Ocado maintains its supply agreement with the John Lewis Partnership. Clarke and his executive peers, then, are kept busy with a broad range of business interests – and there is always another big project on the horizon. Clarke says the next big chapter could involve international growth. Cloud will play a crucial role here and allow Ocado to build apps and move data quickly, something that could prove crucial if the company is to roll out its approach successfully across other territories. Another of his long-standing priorities is to push what he refers to as the “10X” agenda, where the business attempts to use innovation to
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make huge leaps forwards in systems development. The firm is already pioneering research in robotics, 3D printing and other advanced areas. Clarke wants this type of advanced thinking to become a norm for the business. The creative environment at Ocado, which originally encouraged Clarke to stay with the business long-term, is also a key means for attracting new IT talent. At times, the techniques Clarke and his team use to attract talent are also unusual. Late last year, Ocado ran a Clean Sweep initiative, where the firm targeted employees working at some of the biggest IT firms in London. Ocado sprayed stencilled advertisements on the pavements outside rival companies, offering people the opportunity to talk to current employees about working for the firm’s technology division.
The disruptive edge Clarke states the Clean Sweep initiative is representative of Ocado’s innovative approach to business. “We really focus on the disruptive edge”, he says. “We have agility – what we are able to offer IT professionals are very different to the technology experiences at other big businesses. And we try to adopt the attitude that giving IT people the freedom to play leads to great solutions for the business.”
The firm, says Clarke, has been able to benefit from a long history of stealth-like guerrilla projects. In fact, such innovative thinking has often led to fully-fledged business systems. He says the key to success is to not dismiss bottom-up creativity and to not push people into uncomfortable situations. “CIOs must be open to thinking outside the box when it comes to IT recruitment”, he says. That openness has extended beyond the UK, with Ocado also able to draw upon an offshore technology development centre in Poland. Clarke describes that move as an attempt to shop for talent in an area that is recognised for its strengths in engineering. Ocado’s focus on bespoke development is such that the firm only draws on outsourced IT professionals at times of high capacity, and for short-term bursts. Clarke says his firm’s continual desire to boost IT talent means he will be looking to source more workers through the year. He says he is looking to recruit about 120 people during 2014, meaning the firm should have about 500 IT workers by the start of 2015. “We like to keep things in-house and we have a gene pool to which we’re continuously looking to add new IT talent,” says Clarke.
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How can CIOs be the catalysts for business innovation and growth?
Cloud and XaaS are key for creative disruption Cloud and ‘XaaS‘ are key factors for creative disruption. How can CIOs be the catalysts for the new times to come? Four CIO’s give their perspectives on the changing role of technology management. Rogério Campos Henriques, CIO of Fidelidade: “The pace of change and impact spurred by new technologies is so clear that the mere allusion to technology as the key factor for business model creative disruption is becoming commonplace. CIOs need, however, to avoid the typical hype that so often leads to inadequate return or purely technological investments.” Carlos Vaz, CIO of Chamartin: “To Cloud, or not to Cloud? The real question is: ‘Cloud: Yes! But when and how?’ Could anyone have imagined a few years ago that it would be possible to start a company within minutes? We’re talking about creating the whole of the systems a company
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CIO VISION CIONET Portugal
needs, such as an email server, a file server, directory services, ERP, CRM, etc., all in few minutes. Or even that a large corporation could reduce its sales department by 20% and still get the same results? These are examples of cloud computing’s potential for differentiation. Obviously cloud computing is not a miraculous solution for all of our problems, nor even infallible, but it can be a great lever for innovation and cost reduction. To Cloud? Definitely!” Filipe Frasquilho, CIO of REFER Telecom: “Cloud Computing cannot be ignored, whether it is private, public or hybrid, IaaS, PaaS or SaaS. Whoever is not ready for cloud adoption, is unlikely to become competitive or maybe even survive in the global market. The competitive advantage associated with cloud will quickly disappear, as soon as its adoption is generalised. This is why the greatest growth in corporate solutions will come from PaaS, with the benefits inherent to
cloud computing but also allowing the development of solutions and processes in accordance with the innovation and differentiation that each organisation has, intends to have, or can implement.” Artur Loureiro, former CIO of Sonae: “Recent digital trends have boosted innovation creating new product concepts, changing the consumer experience and increasing customer services. Cloud was the beginning, along came Mobility, Big Data and Business Intelligence. We are getting closer to our customers and they are becoming more demanding. Mobility changed the way they buy but also what they buy. Consumers don’t buy what we offer; we have to offer exactly what they buy. It is important not to forget that technology is from people to people. Companies must focus on customers and invest in the correct skills and training. Technology sets the pace, people define the path.”
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