IBM Study Shows CIOs Task to Improve Customer Experience is a Top Job


IBM Study Shows CIOs Task to Improve Customer Experience is a Top Job

By Peter Bernstein, Senior Editor  |  June 01, 2014

It has been a not so well-kept secret for the past few years that the job of Chief Information Officer (CIO) is in the midst of major transformation as a result of all of the trends we all know an appreciate—mobility, virtualization, cloud, BYOD, Big Data and all things related to enhanced security. 

There have also been plenty of books and reports about how the CIO, based on business imperatives, has been tasked to focus more of their technology concentration to align with C-levels - making improving the customer experience an enterprise-wide top imperative.  This too has been a result of noticeable trends such as the explosion of readily available customer options, increasing customer fickleness based on their access to information and the requirement that enhanced customer intimacy in a rapidly changing world is an important ingredient in creating differentiated competitive value.  In fact, it has made the creation of new titles like “Customer Experience Officer” and Chief Interactions Officer” the fastest growing new positions at large enterprise around the world.

However, questions arise as to how much of the talk is becoming action, and how are CIOs shifting their responsibilities and budgets in response to new mandates regarding capturing and keeping customers.

It is always great to look at numbers on such important trends for confirmation, and IBM (News - Alert) has released an insightful report, “Moving from the Back Office to the Front Lines - CIO Insights from the Global C-suite Study, which shows just how important customer experience improvement has now become for CIOs and their staff. Based on face-to-face conversations with more than 1,600 CIOs from 70 countries and 20 industries worldwide (and over 4,000 IT professionals in total), the research, conducted by IBM’s Institute for Business Value, reveals that customers drive CIOs to turn their focus to the front lines. 

The graphic IBM has produced sums things up quite nicely.

Source (News - Alert): - IBM CIO Insights from the Global C-suite Study

As can be seen, more than 80 percent of CIOs report they are shifting their focus to the front office where marketing, sales and service managers work directly with customers. Plus, they are putting their money where their mandates now rest by investing in new technologies to gain deeper insights into customer data.  In fact, IBM found that examples of this type of investment include sentiment mining and social network analysis to identify unique behavioral patterns and reliably predict critical trends.

"The study reveals the emerging reality that there is no longer any real distinction between the customer experience and contemporary business strategy," said Peter Korsten, global leader, IBM Institute for Business Value. "The quality and nature of the front-end experience has become the point of entry to the most valuable information any enterprise can possess -- information about its customers, employees, or any other relevant constituent group." 

More importantly, it is not just money it is CIO time as the chart below indicates the shift from last year to this year.

The shift is on as new technologies for engagement are employed 

IBM found that CIOs at outperforming enterprises recognized that technology factors will have a significant impact on their organization. As IBM notes, the focus on technology aimed at customer experience represents a notable shift over the few years.  “There have been significant changes over the past eight years. One big change is accessibility. IT didn’t always have an equal seat at the table. Now, my peers are far more tech savvy,” Nick Smither, CIO of Ford Motor Company (News - Alert) told IBM as part of the study research. 

IBM also found that, “Getting the basics right has become table stakes for CIOs looking to push their enterprise forward with new engagement and technology delivery platforms.”  In fact, 66 percent of CIOs said the fact that their IT departments have become digitally adept has freed CIOs to look at new platforms that enable them to build what is called a “Customer-Activated” enterprise. 

Another interesting insight from the report was that there is a correlation between the rising importance of customer engagement and interest in cloud computing.  For example, 64 percent of CIOs named it as part of their visionary plans compared to 30 percent in 2009.  The same was true for mobility with 84 percent saying it’s their top focus compared to 68 percent in 2009. 

As noted at the top the inexorable technology trends driving us forward in general have particular value in the context of improving the customer experience as reflected in the study where roughly  two-thirds of CIOs said they are exploring how to better serve and collaborate with customers using cloud computing and social networking tools. 

There is a lot more information that is significant food for thought in the study which can be viewed in its entirety  here.   It is nice to know that so much C-level attention is being paid to delighting and keep both individuals and companies as customers.  What will be really interesting to see is how much this investment translates into better customer loyalty and improved customer satisfaction scores. 

Edited by Stefania Viscusi
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