QI: Comparing Opinions of CEOs and the CIO
Technology contributes to improvement in hierarchical, a functional structure. It also can significantly improve internal and external processes of a company. In many situations, the goals and objectives of a commercial organization are different from the ones that Chief Information Officer (CIO) sets for the technical side of the business. The reality shows, however, that the only effective way to build on the sustainable growth of a company is to ensure that collaboration and transparent communication process define the way CIO and Chief Executive Officer (CEO) work together. With that in mind, setting the budget and defining strategic goals that are further translated into operational and tactical objectives within commercial and technical structures are the key elements of an effective organization.
Guthrie (2016) outlines a number of opinions expressed by CIOs and CEOs of various organizations. They demonstrate the challenges that companies are going through in the past decades and show how opinions of high-level executives are different from the direction in which IT budget should be changed in 2016. An insight into the opinions of the professionals allows arguing that all of them understand the increased importance of cloud computing the need to shift focus and the IT infrastructure towards this market trend for several reasons. Many professionals, CIOs, and CEOs agree that legacy systems are becoming outdated and there is an urgent need to renew these elements in the business that appear to have extremely high costs of maintenance and low agility. With that in mind, IT infrastructure in modern large corporations is one of the critical elements of short as well as long-term budgets. Jason McKay further argues that it would be unreasonable from the organizational cost perspective to invest in updates and refresh of existing costly systems. He claims that it is much more rational to shift organizational focus to implementing a more modern and, in long-term, more cost efficient individual or multi-cloud solutions.
The article provides a number of responses, which illustrate the differences in understanding and view that CEOs and CIOs have on IT infrastructure and the role of the technical organization in general. It is possible to see this difference of opinions in other academic works and business studies that involve an analysis of goal setting and roles of CEOs and CIOs in companies.
Let´s look first at the CEOs to perspective. CEO of a commercial organization is mostly concerned with the strategic direction, reaching sales targets and profitability goals. That said, these individuals are, surely, aware and are concerned with the costs of the organizational infrastructure and IT specifically. At the same time, the lack of understanding of the specificity of the IT systems does not allow them often to fully recognize the need to focus investment efforts on optimization and innovation in this area. CEOs focus on cloud computing and investment in social media, analytics and other IT-driven elements are based on the evaluation of potential benefits for marketing and profit optimization. Main challenges that CEOs face in 2016, according to the professionals occupying these roles include the following: ensure that the organization reaches its ultimate revenue and profitability goal; simplify IT infrastructure on internal end-user and customer side to ensure less human error and better acceptance by the final consumer; lead a product innovation thinking and efforts in the company; support the projects aimed at retention and acquisition of the clients.
CIOs of contemporary organizations express major concern about the general global trend of moving towards cloud and multi-cloud computing. The management of IT organizations is highly concerned not only with optimization of internal IT infrastructure to respond to market demand but also with the costs and risks associated with moving to a cloud technology, such as higher security and encryption standards, management of outsourcing costs and third-party service providers and others. Justin Giardina, for example, touches upon the security concern for the organization and highlights the important role of renewing IT structure to limit the high-profile cyber attacks and ensure safe cloud environment (Guthrie, 2016). Petersmark (2014) summarizes the results of the survey, conducted among CIOs of different organizations, who received an award for their achievements in 2013. The results demonstrate that the core priorities of these individuals are built around the five business areas: data management and analytics for the business: application development for internal and external use; cloud computing, which includes private, public and hybrid clouds; security of the operations, including virus protection, VPNs and firewalls; and mobile management and tablets. That said, the IT professionals are much more concerned with the operational level objectives rather than strategic goals.
Petersmark (2014) argues that while the ultimate role of CEOs is to set the strategic direction and provide leadership to their subordinates, the role of CIOs is to lead IT organization and provide guidance to the IT professionals to reach their strategic goals. At the same time, the interviews conducted by Guthrie (2016) illustrate that the similarities between CEOs and CIOs roles, which are, in the abstract, obvious, in fact, are not always recognized by the professionals themselves. CEOs often see IT organization as a support function and the challenges of maintaining the structure and security of IT systems are seen by these individuals as secondary to the strategic organizational goals. CIOs, on the other hand, focus on security, innovation and new development as the core of their contribution to the business strategy.
With that above in mind, funding of certain activities in an organization is a matter of general high-level goals. It is important that the approval of any budget within IT organization is signed off by CEOs as well as CIOs with the clear line of communication transparency where both sides understand the contribution of this investment to the achievement of the long-term objectives. Linking the budgets to the specific goals and making these goals common for a commercial and technical organization will improve productivity and performance.
QII: What Challenges social Media, Analytics and Cloud Computing Set for a Company?
Contemporary business environment places a lot of pressures on the companies with regards to their responsiveness to the market trends and ability to become more flexible and cost-effective. While strategies and approaches to the business differ in organizations, all market players have several objectives in common. First of all, it is an ultimate goal of ay business to be profitable and ensure sustainable competitiveness in their respective markets. Secondly, companies are willing and should be able to associate their brand with some specific elements that build on consumer loyalty. Finally, the company´s goal is to build on shareholders´ value in a short and the long term. With that in mind, profitability is critical to organizations.
Taking into account growing sizes of the companies, the impact of external factors on the operational costs and the increasing interest among individuals and groups in e-commerce shopping and remote services, the companies are forced to focus their Research and Development (R&D) and innovation efforts on building specific and interesting propositions for their clients. Technology is the key to creating this competitive propositions. It does not, however, limit the area of concern to the companies with technology. The external side of innovation in technology, such as applications and user-interfaces is a revenue-maker, and the internal element, such as an implementation of new systems, IT security infrastructure, and analytics are the cost-effectiveness tools. Both are critical for the achievement of the core goals of the company: profitability and building shareholders wealth.
In this essay, we will look at three specific sets of technology: social media, cloud computing, and analytics. The purpose is to look at advantages that these technologies bring to the companies as well as to identify main challenges associated with them.
First of all, it is difficult to find a single modern organization that does not use or at least is not present in social media. Contemporary business and social environment offer numerous ways to get involved in this technology: Facebook, Twitter, Youtube, Snapchat, Linkedin and many other networks, which increase business presence in social media. The purpose of each of these networks is different in a way it speaks to it´s public and what kind of message it transfers. There are several major advantages that a company can get from the social media. First of all, it opens various opportunities to increase brand recognition and reach out to target customer segments. Secondly, social media is a way to advertise specific products and bring news to the knowledge of a targetted or the wider public. Thirdly, social media is a way of data collection which allows the better understanding of customer psychology and segmentation of customer groups. With that in mind, social media technology is the key to marketing strategy. On the other hand, there are several major challenges that companies face with regards to social media. First of all, utilization of social media exposes the brand to the wider public. As it is often difficult to control what and how is communicated about the companies in these networks, many companies find it challenging to take full control over the "language" and "culture" transferred through social media websites. This dilutes in a way brand identity. Another issue is negative review or opinion left by users, which build on a negative advertisement of the company. While social media is open for everyone, companies can only to certain degree control inputs. Finally, social media use poses a number of security threats, such as intrusion of the encrypted data, access to sensitive information and difficulties to control the information shared about the company by its employees on social media sites.
Another technology, which is becoming increasingly important is cloud computing. There are several major benefits for the companies, adopting this technology. First of all, cloud computing is mostly associated with predictability as the costs are upfront. Secondly, it allows cheap and fast software updates. Finally, cloud computing is a constant learning curve, which offers better responsiveness and adaptability to the companies. While the benefits, especially on financial side are obvious, there are several issues and challenges related to the use of the cloud. Cloud is fully reliant on the web. This means that in locations with poor infrastructure cloud computing can present challenges to the company.Secondly, a cloud is an outsourced service. This makes companies dependent on vendors. Thirdly, the companies face with bandwidth and data transfer costs, which may build on a significant financial obligation. Finally, data transfer and storage in a third-party provider server and online make companies more vulnerable to high-profile hacking and security issues. Failure to eliminate these risks can damage the brand and cause a series of legal issues for organizations.
Finally, another important technology which is in a loop of many innovative companies is the data analytics. Digitalization of data and cloud computing allows companies to become more efficient and accurate in data processing and analysis. Various types of technology are able to describe, predict and prescribe specific scenarios of data use. Many providers are able to offer ready or tailored-made solutions for the companies to analyze and process their data. Major advantages of this technology in the contemporary environment are that it can not only gather and retrospectively analyze the data but also provide accurate and knowledge-based predictions and offer solutions based on the quantitative and qualitative data. Data analytics can offer progressive services that allow monitoring customer behavior and improve conversion rates. Additionally, analytics allows companies reduce analysis errors and often real-time fraud detection. Finally, analytics offers an opportunity to better understand competition and develop competitive strategies. At the same time, this technology implies several challenges, such as data analysis through analytics requires companies look for efficient solutions to process real-time data faster and may influence the workload and create stumble blocks in operations.Potential failures in the data analytics system can cause major problems as the size of the data and its volume is significant. Several data analytics are still not able to process real-time data, creating barriers and limitations in the use of the systems and the data itself.
The above outlines some of the challenges and opportunities that technology in the contemporary business environment offers to the companies. It is possible o argue that technology aims to reduce costs and offer efficiency to the organizations. It can bring significant benefits hierarchical, functional and process perspectives. Ignoring it and avoiding innovation will leave organizations one or more steps behind the competition. At the same time, organizations should be aware of the risks and challenges associated with the use of new technology and its adoption for general use.
Works Cited
Guthrie, David. 2016 IT Budget Predictions – A Cloud on the Horizon. CIO.com. Web 26 Apr 2016, http://www.cio.com/article/2984203/budget/2016-it-budget-predictions-a-cloud-on-the-horizon.html
Petersmark, Frank. The Differences between CIOs and CEOs. CIO Insight. Web 27 Apr 2016, http://www.cioinsight.com/it-management/expert-voices/the-differences-between-cios-and-ceos.html
