This document provides an overview of a survey of CIO perspectives on digital transformation and the key enablers of becoming a digital enterprise. The survey found that CIOs feel they have more work to do in areas like multi-channel customer interactions, the CIO leading digital strategies, real-time analytics, and open data. CIOs saw the top benefits of digital enablers as driving innovation, increasing efficiency and flexibility. The document concludes by advising readers to develop a digital enterprise strategy framework to prioritize digital opportunities and investments.

1. The Digital Enterprise:
CIO perspectives
May 2014
Neil Ward-Dutton
All programmes
Free report

2. Table of
Contents
page page page page
Towards the Digital
Enterprise
How CIOs see things About the survey Your next steps
2© MWD Advisors 2014
3 8 23 25

3. Towards the Digital Enterprise
Whether we know it or not, Digital technologies are changing our customers’ and stakeholders’ expectations;
changing the art of the possible in business; and changing every commercial organisation’s competitive
landscape. A proactive and strategic embrace of Digital technologies throughout an organisation, in order to
counter competitive headwinds and meet market expectations, is what the ‘Digital Enterprise shift’ is all about.

4. Hyper-connectivity
drives customer
expectations
We live in a world where
information and communications
technology is arguably the most
potent force driving change.
At the core of what’s happening is
the proliferation of connections
between people, organisations
and goods and services, and the
spread of ideas and expectations.
From a business perspective,
unpredictability is the outcome we
all need to get our heads around.
The accelerating global spread of
ideas and expectations means
that attempting to create a
competitive position based purely
on the price of goods or services
that you offer, or on product
features and functions, is
increasingly difficult.
Delivering sustainable competitive
differentiation has to be about
more than products and price – it
has to also be about aiming to
deliver the best possible
experience to each customer.
4© MWD Advisors 2014

5. Digital
expectations,
digital disruptors
Large organisations in particular
are becoming orchestrators of
many disparate third-party
capabilities; but great customer
experiences have to be
integrated. Customers expect
experiences that are joined up
across multiple online channels,
and that are personalised to their
preferences.
Competing on customer
experiences has never been more
challenging, because new digital-
native players are busy disrupting
industries of all kinds – from
hospitality and transport (Airbnb,
Lyft, Uber) to financial services
(Zopa, Kickstarter).
With no legacy infrastructure to
hold them back, these digital
natives are moving at speeds
most large companies can
scarcely dream of.
To compete more effectively,
established organisations have to
be prepared to make the shift to a
Digital Enterprise operating
model.
5© MWD Advisors 2014

6. What is a Digital
Enterprise?
The vast majority of organisations
large and small are already
‘digital’ to some extent – they use
digital technologies to help with
administrative work, communicate
internally and externally, present
their businesses to customers
through websites, and so on.
However, a Digital Enterprise
takes a ‘digital-first’ approach –
encouraging pervasive use of
digital technologies to conduct,
manage and govern business
activities.
This shift is currently being
accelerated by cloud, social,
mobile and big data technology
trends, as well as the deep
adoption of these trends by new,
disruptive online businesses.
A Digital Enterprise is a business in which digital
technologies are strategically exploited to maximise
global effectiveness, efficiency and
responsiveness. Digital technologies power the co-
ordination of work, the creation and use of
operational and management insights, and the
sharing of knowledge – at scale, across
boundaries, and in a highly integrated way.
Connect to your
markets
Deliver your
products and
services
Manage your
business
CLOUD – SOCIAL – MOBILE – BIG DATA / ANALYTICS
6© MWD Advisors 2014

7. Ingredients and
enablers
A Digital Enterprise shift can have
many starting points and
undoubtedly has many enablers
and ingredients. We’re particularly
interested in exploring this set of
12 ingredients and enablers.
Connected products and
infrastructure
Taking advantage of ‘Internet of
Things’ possibilities
Multi-channel customer and multi-
channel partner and supplier
interactions
Customer, partner and supplier
experiences that work seamlessly
across online channels, including
mobile and social
Cloud-based services and
resources
Enabling you to fast-track
development and change of
capabilities and services
Open data
Offering your own business data,
e.g. aggregated usage or
customer data, online as a service
to others
Real-time analytics
Using predictive models and rules
to make recommendations, e.g. in
sales or customer service roles or
to drive dynamic offers or pricing
Social collaboration platforms
To drive better knowledge sharing
and task co-ordination, whether
internally or externally
BPM and Case Management
Enabling you to get critical work
that spans individuals and teams
done more effectively, and
measure it better
IT Governance, Enterprise
Architecture, Portfolio
Management
Helping to direct and shape
technology investments within
fast-changing environments
Design thinking
Taking an ‘outside-in’ approach to
designing business services that
starts with customer personas and
journeys
Data literacy
Educating employees about the
value of data and tools that can
be used to explore and manage it
appropriately
CIOs as Digital leaders
Embracing Digital disruption as
well as ‘keeping the lights on’
7© MWD Advisors 2014

8. How CIOs see things
In a study carried out in the first quarter of 2014, we asked a group of IT leaders about their current Digital
Enterprise capabilities, their investment priorities and drivers, and the factors holding them back.

9. Investment
priorities and
maturity
Across the board, our group of IT
leaders feel they have more work
to do.
Four areas show a particularly
significant gap between current
capability and investment priority:
multi-channel customer
interactions; the CIO becoming
responsible for Digital strategies;
real-time analytics; and open data
(though this last factor was cited
as being the lowest priority overall
by the group). 0.0 1.0 2.0 3.0 4.0 5.0
Open data
Data literacy
Design thinking
BPM and Case Management
Multi-channel partner interactions
Social collaboration platforms
Real-time analytics
Connected products and infrastructure
The CIO becoming responsible for
Digital strategies
Cloud-based services and resources
IT Governance, EA and Portfolio
Management
Multi-channel customer interactions
Maturity Priority
9© MWD Advisors 2014

10. 0%
7%
10%
22%
22%
29%
34%
49%
0% 10% 20% 30% 40% 50% 60%
Retain employees
N/A
Improve risk mgt
Match competitors
Increase profit
Drive innovation
Improve flexibility
Increase efficiency
Connected
products and
infrastructure
Over the following pages we show
how our group sees the value of
each of the 12 Digital Enterprise
enablers/ingredients.
Creating connected products and
infrastructure is seen by our group
principally as an opportunity to
increase business efficiency
(49%), with 34% citing flexibility
as the driver and only 29% citing
innovation.
10© MWD Advisors 2014

11. 2%
7%
10%
22%
24%
24%
37%
44%
0% 10% 20% 30% 40% 50%
Retain employees
Improve risk mgt
N/A
Improve flexibility
Increase efficiency
Match competitors
Drive innovation
Increase profit
Multi-channel
customer
interactions
Supporting multi-channel
customer interactions is seen
firmly as a profit driver (44% of
our group made this association),
with 37% linking it to innovation.
11© MWD Advisors 2014

12. 2%
10%
15%
17%
27%
32%
32%
44%
0% 10% 20% 30% 40% 50%
Retain employees
Match competitors
Drive innovation
N/A
Increase profit
Improve risk mgt
Improve flexibility
Increase efficiency
Multi-channel
partner interactions
When it comes to multi-channel
partner (as opposed to customer)
interactions our group leans much
more heavily towards efficiency as
being the primary benefit (44%)
with 32% citing increased
flexibility as a key reason to invest
in this area.
12© MWD Advisors 2014

13. 2%
5%
7%
17%
24%
32%
46%
66%
0% 10% 20% 30% 40% 50% 60% 70%
Retain employees
N/A
Match competitors
Improve risk mgt
Drive innovation
Increase profit
Improve flexibility
Increase efficiency
Use of cloud-based
services and
resources
Our group strongly endorses use
of cloud-based services and
resources in order to drive
efficiency (66%) and, to a lesser
extent, flexibility (46%).
13© MWD Advisors 2014

14. 0%
10%
12%
17%
22%
27%
27%
29%
0% 5% 10% 15% 20% 25% 30% 35%
Retain employees
Match competitors
Improve risk mgt
Improve flexibility
Increase profit
Increase efficiency
N/A
Drive innovation
Open data
initiatives
Creating open data initiatives is
something our group is pretty
ambivalent about, at least as yet –
with 29% seeing this as
something that could drive
innovation but 27% identifying
open data as something that has
no direct relevance to them.
14© MWD Advisors 2014

15. 0%
10%
12%
29%
34%
37%
37%
39%
0% 10% 20% 30% 40% 50%
Retain employees
N/A
Match competitors
Improve flexibility
Drive innovation
Increase efficiency
Improve risk mgt
Increase profit
Real-time analytics
A real-time analytics investment is
a Digital Enterprise enabler that
our group has a wide and even
spread of views about. 39% see
the driver as being profit growth;
37% highlight risk management
and efficiency; and 34% point to
innovation as being a key driver
behind investment.
15© MWD Advisors 2014

16. 2%
12%
15%
22%
27%
34%
37%
44%
0% 10% 20% 30% 40% 50%
Improve risk mgt
N/A
Increase profit
Match competitors
Retain employees
Increase efficiency
Improve flexibility
Drive innovation
Social collaboration
platforms
Social collaboration platforms are
seen by our group as being
primarily about driving innovation
(44%), though 37% cite improving
flexibility and 34% cite efficiency
gains as key reasons to invest.
16© MWD Advisors 2014

17. 7%
7%
12%
15%
22%
22%
32%
56%
0% 10% 20% 30% 40% 50% 60%
Match competitors
Retain employees
Drive innovation
Increase profit
Improve flexibility
N/A
Improve risk mgt
Increase efficiency
BPM and Case
Management
BPM and Case Management
investments are clearly seen by
our IT leader group as being
primarily interesting in order to
drive efficiency (56%); but overall,
our group showed a fairly weak
level of interest in this topic – 22%
indicated it wasn’t a current
consideration at all.
17© MWD Advisors 2014

18. 5%
5%
7%
10%
12%
22%
51%
68%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Match competitors
N/A
Retain employees
Increase profit
Improve flexibility
Drive innovation
Increase efficiency
Improve risk mgt
IT Governance,
Enterprise
Architecture,
Portfolio
Management
Interest in IT Governance,
Enterprise Architecture and
Portfolio Management amongst
our group quite closely matches
interest in BPM and Case
Management – with risk
management and efficiency the
most oft-cited drivers for
investment. Here, risk
management is highlighted by
68% of our group, and efficiency
by 51%.
18© MWD Advisors 2014

19. 2%
7%
10%
12%
17%
27%
32%
44%
0% 10% 20% 30% 40% 50%
Retain employees
Match competitors
Improve risk mgt
Increase profit
N/A
Improve flexibility
Increase efficiency
Drive innovation
Design Thinking
Investments in Design Thinking
initiatives are seen by our group
as being primarily about driving
innovation (44%), and secondarily
about driving efficiency (32%) and
improving flexibility (27%).
19© MWD Advisors 2014

20. 5%
7%
10%
15%
20%
27%
32%
39%
0% 10% 20% 30% 40% 50%
Match competitors
Retain employees
Improve flexibility
Increase profit
N/A
Drive innovation
Improve risk mgt
Increase efficiency
Data literacy
Investing to improve ‘data literacy’
across an organisation is seen by
our group as being primarily a
way to boost efficiency (39%),
improve risk management (32%)
and drive innovation (27%). 20%
of our group, however, indicate
that data literacy is not currently
of interest.
20© MWD Advisors 2014

21. 15%
17%
20%
24%
29%
29%
44%
51%
0% 10% 20% 30% 40% 50% 60%
Retain employees
N/A
Match competitors
Improve flexibility
Improve risk mgt
Increase profit
Increase efficiency
Drive innovation
The CIO driving
Digital strategies
When it comes to the CIO
becoming responsible for Digital
strategies, our IT leader group
primarily sees this as being a way
to boost innovation (51%), and
increase efficiency (44%).
21© MWD Advisors 2014

22. 29%
34%
37%
51%
56%
56%
0% 10% 20% 30% 40% 50% 60%
Understanding of what a business
case looks like
Availability of funds for investment
Buy-in from budget holders
Co-ordination and availability of
resources to work on projects
Understanding of how other
businesses are moving ahead
Clarity of our business strategies
Moving forward
We also asked our IT leader
group what they need to improve
in order to be able to move
forward with investing in Digital
Enterprise capabilities.
The two most common responses
were: improving clarity of
business strategies (56%) and
improving understanding of how
other businesses are moving
ahead (also 56%). Improving
availability of resources to work
on projects was also commonly-
cited (51%).
22© MWD Advisors 2014

23. About the survey

24. A survey of IT
leaders
In February 2014 we carried out
an online survey with a group of
41 CIOs and other IT leaders.
Only genuine IT leaders’
responses were counted.
We asked this group questions
about their current maturity in
different Digital Enterprise
enabler/ingredient areas, and their
investment priorities among those
same areas. We also asked them
to tell us where they thought the
value from each area would come
from.
7% of the group came from
organisations with 0-50
employees; 24% from
organisations with 50-1,000
employees; 41% from
organisations with 1,000-10,000
employees; and 20% from
organisations with greater than
10,000 employees. 8% did not
provide this information.
32% of the group have a seat on
the main board of their
organisations; 44% report to
someone on the main board; 17%
are in neither position. 7% did not
provide this information.
0-50
7%
50-1,000
24%
1,000-10,000
41%
10,000+
20%
?
8%
Main board
32%
Reports to
board
44%
Neither
17%
?
7%
24© MWD Advisors 2014

25. Your next steps

26. Explore the
possibilities –
develop a Digital
Enterprise strategy
framework
Deciding what to do about
disruptive digital technology
trends is hard – it’s really difficult
to know where to start. It’s
perhaps too easy to focus on one
aspect of digital disruption – for
example, mobile technology – and
explore potential projects there.
But perhaps you should be
prioritising investigations into
Cloud computing, social
platforms, Big Data, or something
else? Maybe an Open Data
product or service is something
that could yield value for your
business?
A Digital Enterprise strategy only
really makes sense when you can
make sense of your business
mission and strategy, and tie
these to digital technology
opportunities and threats to create
a strategy framework.
If you’d like to find out how we can
help you build a framework for
Digital Enterprise investment
exploration and investment
prioritisation, please contact us at
info@mwdadvisors.com.
26© MWD Advisors 2014