Written by Mark Chillingworth Photographed by Matt Gore
“If you were going to categorise, it is to transform the business model and take everyone with you” Steve Homan, Digital Transformation Director of the Collinson Group says of his job title and the digital focus of his role.
“I work with the CEO of the business and my role is very different to any role I have had before. Rather than spending time as a CIO looking for a reason to transform the business. That is my job; so you don’t necessarily have a clear a remit, but its about taking the business from A to B and transforming it in totality, people, culture and processes, but most importantly the business model,” Homan says of his role. Collinson Group is a privately held UK business in the loyalty, rewards and insurance markets.
As Digital Transformation Director Homan has been working in its airport lounge business, which is one of the largest areas of business for Collinson Group.
“At the Daily Mail I spent some time on how we engage customers outside of the editorial space. It is about the right to play to have the conversation with the executive peers,” Homan says of being a CIO with a digital transformation remit. “I don’t have the operational responsibilities. Running a large and complex media business is not something you can do for half a day a week. What you have now is a focus. CIOs can do that, but in this role you have the time and the deep focus to do the thinking into some of the challenges. If you have a business that genuinely needs to change its business model that is not something you can do on a Friday afternoon on the corner of your desk,” he says of how CIOs have a demanding role. Homan adds that his role requires “significant research, real thinking and validation”.
“I would suggest it is very different day-to-day, but there is no reason that others can’t do it, it is about the focus,” he says in support of CIOs leading digital transformation.
“Getting clients to understand that digital transformation is a journey is not something that you can set out and say this is the single strategy and what we are going to do over this amount of time and then it is done,” says director of technology consultancy Amido Rob Pearson. “Transformation should be a balance of upfront planning and the client should understand that there will be some emergent planning as the project unfolds. Any organisation is a complex system and you run that over time and you get emergent properties to that and you have to be responsive to that for your digital transformation to be successful.”
Both Homan and Pearson agree that changing the business model is central to what digital transformation is to a business. The digital element may be a completely new way of trading with customers or an entirely different way of operating the organisation. Richard Cross moved from CIO to CDO at engineering firm Atkins. The change in job title was also about a change in focus with Cross focusing on changing the way Atkins operated as CDO, yet the organisation remained consistent in its business as a civil engineering provider.
“When you are changing business models there will be all sorts of reticence from individuals who have invested time and effort into the technologies that we are talking about replacing,” Pearson says of a situation many CIOs have come across.
Earlier in the year Fergus Boyd, head of digital and IT at challenger hospitality business Yotel told this title’s CIO podcast that he has a sales target as one of his key performance indicators (KPI).
“It should definitely be part of it and it is forcing businesses to understand where they position technology in the organisation and does IT have a seat at the top table whether board or executive level,” Homan says of how important it is for organisations to understand that technology is intrinsically linked to the revenue generation of the organisation.
“There is a bit of a pity party that goes on in tech, are we positioned properly, it is a load of rubbish, if you are not positioned properly then you probably need to change jobs, if the organisation does have the position but you are not involved in then you need to understand how you need to change to be involved in it,” Homan says of why he believes technology leaders need to both win the position and organisation appreciate the role technology plays.
Pearson at Amido is not sure CIOs and CTOs should be involved in revenue generation and instead believes this is an area for the chief marketing officer (CMO).
“The best businesses will have a CMO role, but the route to customer and the ownership of that stream to the customer is spread throughout the organisation and the CMO may be the person that mechanises it, but it is that spread that creates a transformation in a business,” Homan says in disagreement.
“The CIO can see the opportunity because technology is dragging the business on and often it is the CMO that is one of the first to resist because a lot of boards and exec teams have that collective passive resistance which they wear like a comfortable blanket and someone has got to take it off and get the organisation to think differently,” Homan adds. The digital leader believes part of the problem with the digital agenda is that it has become focused on just one part of a customer’s interaction with the organisation.
“Customer engagement is the veneer, the core of it is: Are we creating core sustainable new business capacity in our business and are we doing that in a way that creates differentiation and future proofing?” Pearson agrees that differentiation is key and allows an organisation to go out to the market and position yourself”.
The right platform
Following the success of predominantly digital only business there has been a great deal of talk of organisations becoming platform businesses.
“If a business needs to change its business model to a platform business for example then technology goes from an enabling technology to a critically enabling factor,” Homan says.
“A platform proposition has multiple sides to it, how do I keep all sides of that happy, how do I create the means that everyone can win,” Homan says of what a platform really is to a business model. “The world is littered with propositions, principally from the Silicon Valley area that grow very quickly using marketplace or platform models and then they ask someone to pay and it all falls to bits or they have to change their model.”
“A platform business model is not about using excess resource or connecting things, it is about whole parties creating an eco-system and interacting,” Homan defines. “Can you create satisfaction for all the sides, supply and demand where everyone wins so you create liquidity and then a network effect.
“Do things better. We have to find the extra 20 to 30% to make it better for the customer and it is a constant trade off that Pearson was talking about,”
“It gets confused by the constant referencing of businesses that are economic freaks. Uber may be worth more than BMW, but you are not Uber and no one is going to give you that amount of money,” Homan says with startling reality.
Homan says it is crucial for organisations to understand what moving to a platform business model really means as it can easily lead to your organisation being a loser. Pearson agrees and adds that whether it’s a platform model or a digital transformation of operations the management of that change is a major challenge. The Amido Director says understanding the impact and tensions between customers and the organisation when you automate services is key. Pearson has worked with clients that need to automate services to protect their organisation, but in doing so risk losing the personalised essence of their service to their customers.
“Customers are increasingly expecting a 24 hour service and customers are expecting to do more complex processes online, like tenancy renewal,” he says of a customer in the housing sector, “So it is a prime candidate for a dashboard process for things like booking repairs, can that be an API for the repairs company? The expectation is growing, but at the same time how do we retain the personal dimension,” Pearson says of how sensitive digital transformations have to be handled. “You have to look at it as an aggregate,” he says.
“Do things better. We have to find the extra 20 to 30% to make it better for the customer and it is a constant trade off that Pearson was talking about,” Homan says.
“How much am I prepared to transform how I operate and how does it really work for the customer. There are a lot of changes that are just veneer and spotting that is when you are really transforming the business. Putting a set of shiny new things on top of existing things is just shiny things,” Homan says of how digital transformation is a complete change of model. This is an echo to what former government CIOs Jerry Fishenden, James Findlay, Andy Beale and James Duncan told the Horizon CIO podcast about the need for a new focus in government towards technology.
“It is how do you create the right steps to enable the business, it is not about: ‘lets go and rent some cool space in Shoreditch and employ some people in trainers to tell us what to do with event driven technology and that does go on in some organisations,” Homan says of the need to understand the impact and outcomes of a digital transformation.
CIO role in digital transformation
“Technology today is knitting, you can buy or rent some amazing things off some wonderful companies that are way better at it than you will ever be,” Homan says and when asked if too many business technology leaders fail to focus on information and what it can do for organisations he agrees. “The people that are not focusing on the information are probably waiting to sacked or they are in organisations where technology does not differentiate.
“The I is where you add value. Flip it to a finance, the accounts should add up that is the basic. Having smart financing and how your capital can do new things that is value creation, it is the same with technology.” Pearson agrees adding that clients of Amido are using information analytics for system design and for a great understanding of how transactions and service consumption impacts the organisation and its use of cloud technology.
“Agile is this holy grail of confusion it is just a way of doing things, you can transform an organisation without it being agile, if you want to transform an organisation it could be a useful tool to use,” Homan says of how using Agile methodologies is often seen as the way to be digital.
“Having a relatively clear plan and where you want to get to with a two to three year plan that has vision and how that creates sustainable advantage and that is your North Star and you head towards to it, but things will change and expect to find things out along the way,” Homan says. The digital transformation director adds more weight to this than using an agile method.
Pearson at Amido questions on the Horizon CIO podcast how Homan sells certainty to the organisation in his North Star vision: “It is about having the right level of trust and the team that get why they are going there,” Homan responds. Adding: “You give people as long as they want to tell you their fears and have a debate and commit to it and if they don’t commit then don’t do it. You are then able to have a realistic conversation about the levels of not knowing. There are times when organisations panic and then the inner engineer comes out and wants to make everything clear and write it all down and then people start making bets and that is not relevant.
“You cannot be strained by a rigid system and the big firms are struggling because they have all these gothic levels of control and the smaller businesses are able to make these decisions, they can make decisions in minutes if they want to,” Homan says.
Both agree that too many organisations rely on presentations that are then made to executives that are not interested, or have a bonus structure that the digital transformation may impact or they are perhaps on an earn out. It circles back to Homan’s opening point, for a digital transformation to work it has to be driven by a dedicated leader and agenda.