I regularly hear CIOs and other tech leaders complain of the IT skills crisis – that it is hard to recruit new people, they are too expensive, and that they are hard to retain. But at the same time, Australia Bureau of Statistics data points to the fact that, while the number of people studying IT-related courses is dropping, graduates are finding it hard to get a job – and for every job advertised in IT there are 29 candidates per open role. Despite all of this, I would argue that we don’t have an IT skills crisis – we have a training gap. A big one.
Just in the Sydney market I was recently told by various industry leaders that over the next few years there will be a shortage of AWS skills in the market – by up to 2,000 people. The same can probably said for Azure skills, security, DevOps, data scientists, and Google Cloud Platform. However, assuming 30 in a training group, and a week-long course, the AWS gap could be closed in 15 months by a single training provider – in less time with it spread out across many providers. Yes – some might need more training (weeks or months), but others could need less.
In the battle to keep up with market demands, I regularly see CIOs, Applications, and Infrastructure leaders bring in expensive contractors and consultants to make up for their skills gap. You KNOW what skills you will need. You WILL have some of your applications and infrastructure in the public cloud. You WILL need AI expertise. You WILL need more security professionals. You also know what skills will disappear or have less demand – and if you don’t, get on a call or catch up with a peer in the industry who has made the move to a modern, cloud-based development environment.
The costs of training should be in your budgets today. You should be having conversations with your infrastructure professionals about what skills they will need in the public cloud world – some might make the leap to DevOps pros, others Automation Engineers. You should be upskilling your developers to become BizDevOps pros. Put them through Design Thinking and Customer Journey Mapping training. Have them spend more time with the product, service, or CX leads. Retrain some of your QA professionals to become quality AND monitoring professionals – get them involved in live systems, as it will enhance their testing skills. Work with your DBAs to understand the skills they will need to transition to, and manage public cloud databases.
Most of the people you need already work for you – they just need the skills that will take them and your business forward.
Have you noticed how IT shops are changing? ANZ Bank, BankWest, William Hill, REA, Sportsbet and many other organisations are restructuring their technology function – moving many of the functions that impact the product or customer experiences into the teams that are responsible for that product or the customer experience. These business restructures often go well beyond an IT change – it is usually about putting all of the resources that can impact the customer outcome into the same team in order to be able to drive change at pace. Some take it even beyond the customer and product teams, and move HRM to the Employee Experience team, ERP to the Finance team, CRM to the sales/marketing team/s etc.
So the question needs to be asked – if most of your IT team has been moved to the business teams, what is the role of the CIO? And the answer to that question, most of the time is “there is no role for a CIO”… In fact, many businesses that have made this move no longer have a CIO. When REA made the change, their CIO became the Chief Inventor; when William Hill combined IT and Product, the CIO effectively became the head of products.
But this doesn’t mean there is no role for the CIO – some will see the opportunity to embrace their technical side and become a “Chief Engineer” – as many businesses will maintain some technical capability in house. Some will become the head of Employee Technologies – your information and other workers will still need end-user computing devices, tech support etc. A potential pit stop role will be head of Digital as some companies are giving the responsibility to drive digital transformation to a senior executive (but as mentioned this role is just a pit stop as being digital quickly becomes everyone’s responsibility – not just that of a senior executive!). Some will embrace their passion for innovation and lead the big changes that the business will need to face, and others will step up to a senior management role within the business – possibly managing change, implementing automation, or another new competency required of the business.
So as a CIO you need to start mapping your future journey – when will your company or department embrace the “fast & innovative” approach to business and restructure around products or the customer (some call it the “Spotify model”, others the “software model” – but either way it is about being able to deliver customer value at pace)? What will your role be in the transition? And what will your job look like after the change? I recommend you drive this change and become a master of your own destiny – I know some who CIOs who had this change forced upon them, and it did not end well for them.
I have helped CIOs and their teams with this transition so please reach out if you are interested in having Ecosystm help your business become fast and innovative in order to drive better customer outcomes, and help your CIO and IT team to create a new digital-ready future.
Speed and innovation are at the core of any successful business today – with power placed increasingly in the hands of digitally-savvy and fickle customers, the pressure to continuously improve products and services has never been greater. If they’re not delighted by each and every interaction with a brand, today’s customer simply moves on at the click of a button or swipe of a screen.
For digitally-native businesses – for example, Spotify or AWS – this competitive, customer-focused spirit is in their blood. But otherwise, most traditional businesses today are not set up to deliver a great customer experience. Bogged down by traditional organisational models, they are instead structured more around cost efficiencies than innovation.
Think, for example, of a typical IT team – generally, all tech staff will sit in their own division, removed from the rest of the business because it’s easier to track, manage and budget their work. What happens, then, if the Head of Customer Experience has a request? It’s unlikely they’ll have much interaction with the team, and probable that they’ll be answerable to different KPIs than IT. The result is often two frustrated parties lacking a common language and unable to deliver innovation at the pace required by customers and the wider business.
The challenge is to reorganise team structures in a way that allows for innovation to flourish. In the era of Digital Transformation 1.0, that meant a bolt-on or ‘bi-modal’ approach to digital, essentially giving a dedicated team the resources and license to operate at pace, while the rest of the business continued plodding along in a traditional environment. It’s not a bad place to start to get digital initiatives prioritised, but the reality is that ‘digital’ now impacts every transaction and every touchpoint.
For example, even if customers go into a bricks-and-mortar store, it’s likely they’ll have first researched products and compared prices beforehand. Meanwhile, on the business side, sales & marketing teams are now using aggregated data insights to inform their campaigns in the hope of shortening sales cycles. Or how about airline passengers – how many people do you think would go into a travel agency? Now, we can book our flight, seat, meals and luggage online, as well as check-in before we even get to the airport.
This means that a one-dimensional team isn’t enough to change or impact customer experiences. Instead, businesses need to be gathering people from across their organisation – whether that’s Product, CX, Distribution and of course IT – who today have different metrics, budgets, priorities and timelines, and give them the mandate to work together towards one united goal.
In an airline, that might mean moving from a structure where they have logistics, ticketing, loyalty, IT, project management, customer lounges, check-in, and baggage all into a single team called “pre-flight experience”. Every time a change needs to be made to the customer experience before the flight, all the roles that can impact that change can come together easily, knowing that they share the same goals and are driving towards the same outcome.
It’s a divide and conquer approach – instead of putting all the IT eggs in one basket, you send them into the product and experience teams to develop and improve digital services on the ground. The new structure of IT teams (Figure 1) would have:
- Product and project managers working side-by-side, complementing each other’s skill sets while overseeing the process of developing and improving products, services and experiences
- Developers embedded in the teams, sitting alongside Quality Assurance to ensure the development of digital services is not unnecessarily slowed down
- DevOps providing the cloud infrastructure and platform services as required
- Customer / User Experience teams, working closely with tech to ensure final products and services are easy and intuitive to use, and delight the customer
- Data Management shared across teams to ensure insights are not siloed, but rather treated as a product and integrated throughout a business
- Architecture as a guiding function, constantly evolving and improving capability that makes the business better, more efficient and faster
Security, often shared across teams, and given the ultimate power to say ‘no’ if a product could compromise customers, employees or the business itself
But, where to start? Ultimately, the power to drive changes lies in the hands of the CIO, but will require collaboration across the c-suite as business leaders adapt their relationship with IT and determine team KPIs. It’s also important to provide training to help employees prepare for the new structure.
Once in place, this model could well change the face of IT teams as we know them. For Technology Leaders, the role of the CIO will inevitably evolve – whether they become a technical leader, run innovation and invention functions, or take responsibility for delivering revenue and/or customer outcomes. CIOs who are ahead of this change will be able to shape their role going forward based on their profile – but it’s worth noting that those who have change forced upon them will rarely be in a position to be masters of their own destiny.
On the flip side, for Technology Vendors, this model is likely to bring challenges. By bringing business and tech buyers together into one team, we should see a shorter sales process – but it will also make it harder to find the right buyer in the first place. To further complicate matters, with a focus on delivering continuous customer value, buyers are likely to require specialised solutions tailored to their unique needs and goals. Vendors will therefore have their work cut out to better understand their customers and the outcomes they are trying to drive in order to make the sales process smoother.
This new model of delivering continuous customer value is not perfect – it has inefficiencies, and moves away from focusing on big-ticket inventions towards smaller, everyday innovations. However, it is only through making the transition to becoming a fast and evolving business that companies will maximise their IT and digital capacities.