A few years ago, buzz had the CIO role becoming obsolete. The rise of self-service consumer technology led many to believe these tools would run the world on their own. But digital transformation changed everything, and CIOs are now stepping up as key leaders. Today, CIOs are tasked with “return on innovation,” signaling what’s in store for the role as we emerge from the pandemic.
What is return on innovation?
Return on innovation is the ROI tied to digital transformation initiatives. “If you build it, they will come,” is no longer a sustainable model. Spend to innovate is out. Value for the dollar has found its way to the CIO’s desk.
According to the latest data, 80% of next year's revenue growth will be tied to digital offerings. CIO says, “There is no wiggle room when it comes to project failure or apparent tolerance for the quick and simple.” They suggest three ROI metrics for the entire IT innovation strategy:
- How many innovative projects did IT bring to the table?
- How many of those projects made it to proof of concept?
- How many of those proven concepts were actually deployed?
Consider a fourth metric: How many proven concepts were deployed successfully? Digital transformation isn’t about innovation for its own sake, but that’s where the real ROI comes in.
According to CNBC, “To provide tangible returns while managing uncertainty, CIOs will need to create an architecture that is both future-proof and adaptable. However, most companies are operating with legacy systems and technology debt. As a result, wholesale modernization remains out of reach for now, and digital upgrades are made piecemeal, leading to islands of innovation within the organization.”
What are the most innovative CIOs doing to overcome these challenges?
Secrets of innovative CIOs
The most innovative CIOs generate ROI by going against traditional ways of doing business. CIOs might choose to:
- Skip modernizing legacy platforms and build something new.
- Leverage new tech to bring flexibility, scalability, and an emphasis on value-creation for a better end-user experience.
- Redefine enterprise workflows to foster innovation.
- Automate mundane tasks and redeploy institutional resources toward new product creation and new revenue streams.
- Reimagine work and consider moving toward a remote workforce.
Internal shifts are a necessary precursor for developing new strategies to incorporate IT return on innovation. Eliminating obstacles enables an IT-focused culture of innovation. CIOs can, and should, develop a product mindset for corporate innovation. How can you make that happen?
Approaches for improving IT ROI
IT initiatives must now be considered less project and more product. Being product-driven isn’t a one-off; projects have beginnings, middles, and ends. Products are constantly improved upon in an iterative, innovative approach.
CIOs can embrace their changing role and develop a product mindset by innovating for value, focusing on use cases for each product, making incremental changes, and working in tandem with their CFOs. Prove value with credible, repeatable business results that push business goals forward. Think of innovation from the perspective of internal and external end-users. How will customers leverage your innovation? Measure business value for every product iteration, and take small steps to ensure a smooth transition from project to product focus.
Innovative CIOs are shifting approach to embrace the new ROI. Visit windzr.com to learn more about strategic implementation of a “return on innovation” model.