CIOs rule boards
is the headline of the news that the author of WTM News has collected this article. Stay tuned to WTM News to stay up to date with the latest news on this topic. We ask you to follow us on social networks.
From considering the disappearance of the role of the CIO to playing an essential role in the Board of Directors. This has been the evolution of ICT managers in organizations. The key is that their job is no longer to buy hardware or software as it was a few years ago, but the rest of the managers have understood that their job is essential in the operation of any company today.
Yes, the boards of directors have understood that technology is the essential element in the digital transformation of a company and the CIO is the pillar on which the entire strategy must be based. Its impact on all business areas is a differentiating factor in the income statement, as revealed by the study carried out by Tenerity through the Ipsos consultancy.
In this study, during the months of April and May 2022, a series of qualitative interviews were conducted with high profiles of large companies in sectors such as Banking, Telco, insurance, utilities, Retail, Distribution, Fintech and Insurtech.
Specifically, the budget for technological investment has increased in recent years in all companies. It is dedicated up to 40% of the overall budget depending on the type of company and, sometimes, technology providers outperform marketing in terms of billing.
“At this time there is greater willingness to invest in technology for customer loyalty because results are being seen in the business. Companies are defining plans to implement it with measurable short-term goals. Especially, the Marketing Automation + AI/Machine Learning combination it is helping to get to know the client better, generate a closer bond with him, increase satisfaction and improve the results in the different objective indicators”, stands out Eduardo Esparza, VP General Manager of Tenerife Spain and Brazil.
The boards of directors have understood that technology is the essential element in the digital transformation of a company and the CIO is the pillar on which the entire strategy must be based
A) Yes, all companies admit to having increased their budget and investment in technology for managing clients in recent years, updating or improving existing technologies in the house. Loyalty-oriented technology is part of the global and local strategies of large companies, some have even created specific areas for the data strategy (Big Data) with a view to a higher volume of future development.
One of the companies surveyed revealed that “this year we are dedicating around 30% more budget than last year. We have decided to take that step as a company; is a high cost, but we have decided to invest because we don’t want to be left behind in this, it is necessary to interact with the client today.”
Technology incorporation process by Spanish companies
Currently, the approval of the plans depends mostly on the Management Committee and the Board of Directors under the influence of the CIO. With regard to implementation and measurement, it is in the hands of the R&D, Innovation, Marketing or Growth departments, Data Strategy areas… However, for the specific incorporation of Artificial Intelligence or Machine Learning developments, leadership they assume R&D, Technology, Data Strategy, Analytics, Data Science, engineers, CTO, Operations…
Another of the study companies pointed out along these lines: “We implemented the technology early, now the plans we have are to integrate new functionalities, such as integrating up-sell and cross-sell in incoming calls, because efficiency is extremely high and it integrates customer service with sales. All this is carried out by the R&D department together with the management committee.”
On this path of technology implementation, Getting your strategies right is key.. The main aspects that are taken into account are the impact on the business, the improvement of the income statement, its 360º focus on the client, contribution of value and maximizing value to the client, increase in the average life of the client, the capacity that your application offers to hit what the client needs or wants, improvement of the recommendation, personalization, scalability, automation, reduction of churn, improvement of quality in the teams…
Likewise, corporations set short- and long-term objectives and continuous measurements are made on all indicators. The companies interviewed in this study mentioned the following as indicators of measurement of results: abandonment rates, degree of linkage, persistence in a channel, level of conversion, waiting times, post-issue recurrence, churn…
One of the Spanish companies interviewed pointed out in this sense that “Of all the budget we have, a good part is taken by data. Our industry is very system intensive and very subject to regulation, so now more than ever we need Marketing Automation and we have implemented Agile to save costs; our main goal is to reduce churn rate and increase customer value […] We measure everything with KPIs.”