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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Digital Leadershipand Governance of IT
in the Third Sector
Mark ToomeyProject Editor: ISO/IEC 38500:2008Author: Waltzing with the Elephant
Managing Director Infonomics Pty LtdAustralian ICT Professional of the Year 2012
Forthcoming: Digital Leadership Manifesto
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Looking over our shoulders…
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Evolution in the way we do things…In every field of endeavour
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
The way we store and access knowledge
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
We are in an interesting situation
Mobility
Social Media
Cloud
Internet of Things
BYOD
SaaS
Ubiquitoushigh speed communication
Massive, ubiquitous storage and processing capacity
Big Data, Analytics
Dawn of
the Digital
Era
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
What is the Digital Era
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An unfolding landscapewhere we can do better things we have
always doneand do things we have never been able to do,
because digital technologies enable usto capture and manage information
in ways not previously possible.
It begins with a time of profound, ongoing change,
enabled by digital technologies.
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
The digital era brings a paradigm shift.We have seen such shifts before.
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Each such paradigm change has seen:• Old jobs disappear• New jobs emerge• Resistance to change (workers, community,
leaders)• Inflexible organisations fail• New companies emerge• Flexible organisations adapt and transform
Until stability returns in a new order.
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Digital Era Response Modes
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Digital Disruptors• Amazon• Seek• Realestate• Facebook• LinkedIn
Digital Wannabes• Myer
Digital Catastrophes• Kodak• HMV• Borders• Blockbuster• Fairfax
Digital Deniers• Harvey
Norman• Westpac
Digital Transformers• Burberry• Commbank• GippsTafe
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Consider the contrast
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Digital catastrophes• Kodak• HMV• Borders• Blockbuster• Fairfax
Digital Transformers• Burberry• Commbank• GippsTafe
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Past era successes
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Digital Catastrophes - despite brilliant technology advice and insight• Fairfax
– “Almost every time a company fails or stumbles, industry experts saw the fall coming before the board. The board is often the last to know that its company has serious problems.”.. Eric Beecher to Fairfax
– “I don’t ever want anyone coming into this boardroom again,” he told his colleagues as he held up a copy of one of Fairfax’s hefty Saturday papers, “and telling us that people will buy houses or cars, or look for jobs, without this.”… referring to Roger Corbett, now chair of Fairfax.
• HMV– "The three greatest threats to HMV are online retailers, downloadable music
and supermarkets discounting loss leader product”… the MD was visibly angry… "I have never heard such rubbish, I accept that supermarkets are a thorn in our side but not for the serious music, games or film buyer… …downloadable music is just a fad and people will always want the atmosphere and experience of a music store rather than online shopping".
Page 13Classical Leadership Failure: beyond blindness
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Digital Transformers – major change in outlook with top level leadership
• David Murray, CEO 199x – 2005– blamed technology sector for the
“tech wreck” in 2002 – Mainstream $300 m
• IT-driven innovation hard won.
• Ralph Norris CEO 2005 – 2012– We are going to rebuild this bank– Total systems replacement– Total banking process overhaul– Total executive focus on goal
• From 2008 to 2013– Profit up 8%(13), 11%(12), 13%(11)– Share price up 31% (1y) 79% (5y)– Satisfaction – market leader
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Classical Leadership Success: Delivering a Vision
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Digital Transformation
Digital Transformation isan ongoing and long-term processof rapid and disruptive evolution
in society, markets, business and government,enabled by innovative use of new digital technologies,
which changes established orders of control,creates new perceptions of value
and associated value propositions,and destroys many pre-existing notions
of good practice.
-> New and evolving capability-> New and evolving expectations
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Evolving capability...
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...enabled but not solely delivered by IT!
Four key elements of business capability• People – who participate in business
events• Process – what business events take place• Structure – where business events happen• Technology – enabling and recording
events
IT enables your business capability• Your entire value chain• Your supporting capabilities• But it is not autonomous, or omnipotent• Digital transformation involves more than
just adopting digital technology!
• Business capability development and change
• Process• Technology• Structure• People
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People
Tech-nology
Process Structure
Business Capability
People
Tech-nology
Process Structure
New or Improved Capability
Based on H.J. Leavitt’s Model of organisational change, published in 1965.
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Evolving expectations... the landscape of Digital Transformation
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External
Local
People
Tech-nology
Process Structure
Market
Regulatory
Customer
Public
Supplier
Local
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Pre-digital Post-digital
Your digital transformation touches and is influenced by your entire market context.
Ultimate success is not solely about the technology!
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Achieving Digital Transformation requires…• Comprehend the current and future change in the market:
– As others are driving it;– As you will influence it;– Accounting for uncertainty;
• Conceive your evolving business model and capability:– Place in the market;– Value proposition;– Mode of operation;– Continuously updating as change unfolds;
• Orchestrate transformational change:– In your business;– In your business ecosystem;– Addressing the four fundamental pillars of change;– Constantly adjusting for external events.
• Effective Digital Leadership!Page 18
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
So what is Digital Leadership
• Digital Leadership is the capability of (business) leaders to identify and realise opportunity for (business) growth and value through effective, efficient and acceptable use of Digital Technologies (IT).
• Digital Leadership:– seeks technology enabled opportunity to reinvent the business;– seeks technology enabled opportunity to expand and disrupt markets;– understands how customers, suppliers, competitors and regulators are
using technology to advance their own interests;– energises and focuses the organisation on a new and evolving vision;– does not need deep technology skill – just the ability to see the
potential in technology;– understands that success is not in technology delivery, but technology
enabled business transformation;– organises, engages and focuses the organisation for change;– activates all resources for change.
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Reframing ISO 38500 Governance of ITfor Digital Leadership & Transformation
ISO 38500 Definition:• (Corporate) governance
of IT is the system by which the current and future use of IT is directed and controlled.
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Business
Pressures
Governance
Management of IT – demand & supply
Evaluate
Plan
s, Po
licie
s
Pe
rform
ance
Conf
orm
ance
Direct MonitorPr
opos
als
(Cur
rent
and
F
utur
e us
e of
IT)
IT enabled business change
projects
IT enabled business
operations
Busin
ess
Need
s
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Management of IT – demand & supply
Governance
Business
Pressures Busin
ess
Need
s
Reframing ISO 38500 Governance of ITfor Digital Leadership & Transformation
ISO 38500 Definition:• (Corporate) governance
of IT is the system by which the current and future use of IT is directed and controlled.
• The current and future use of IT includes digital transformation of the organisation and the organisation’s participation in digital transformation of the marketplace.
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Market
Evolution
Digital EraGovernance
Management of Digital Business Transformation - Digital Leadership
Digi
tal
Tran
sfor
mat
ion
Plan
s & P
olicy
Busin
ess
Evolu
tion
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IT enabled business change
projects
IT enabled business
operations
Digital Transformation
Initiatives
Digital Business
Operations
Plan
s, Po
licie
s
Pe
rform
ance
Conf
orm
ance
Digi
tal e
raPe
rform
ance
Conf
orm
ance
Prop
osal
s (C
urre
nt a
nd
Fut
ure
use
of IT
)
Digi
tal E
raSt
rate
gy, P
olicy
,Pl
ans,
Initi
ativ
es
Monitor
Evaluate
Direct
Evaluate
Direct Monitor
Market
Evolution Busin
ess
Evolu
tion
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Responsib
ility
Strateg
y
Acquisition
Perfor
mance
Conformance
Human
Behaviour
Reframing ISO 38500 Governance of ITfor Digital Leadership & Transformation
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Some questions for you to ask, derived from the principles• Responsibility
– Do your executives, managers and staff have a clear understanding of their role in respect of planning, building and running a successful 3rd sector organisation in the digital era?
– Who are the significant actors external to your organisation who will play a significant part in setting and realising its digital era agenda?
• Strategy– How is your organisation tackling the essential task of planning its
journey into a digital future over which it has little control?– How complete is your understanding of the evolving landscape in
which you, your peers, your clients and other actors are moving inexorable toward the digital future?
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Some questions for you to ask, derived from the principles• Acquisition
– How do the plans for evolution of your organisation exploit new digital opportunity to create improved business capability, with particular reference to evolving the business model and practices?
– How do the decision-making arrangements in your organisation enable timely and decisive action to invest in, redirect and terminate technology-enabled change initiatives?
• Performance– How deeply are your organisation’s leaders engaged in oversight
and control activities to ensure success of initiatives that are delivering digital era capability and digital transformation?
– To what extent do gaps in capability and weakness in currently used technologies limit the ability of your organisation to remain relevant and be successful as the digital era unfolds?
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
Some questions for you to ask, derived from the principles• Conformance
– How is your organisation tracking, responding to and influencing the evolving conformance demands as your market evolves into the digital era?
– How are the internal policies and controls of your organisation adapting to enable an effective approach to digital transformation?
• Human Behaviour– What are the characteristics of the significant human communities
involved and affected by your organisation’s approach to the digital era?
– What impact has digital era human behaviour already had on your organisation, and how is it expected to affect your organisation in the future?
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©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
An opportunity to consider
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Responsib
ility
Strate
gy
Acquisition
Perfor
mance
Conformance
Human
Behaviour
MarketRegulatoryCustomerSupplierLocal
Public
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Can this model help
you to understand the
landscape for your
organisation's journey
into the digital era?
©2014 Infonomics Pty Ltd Digital Leadership & Governance of IT
[email protected]@digitalleaderau
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Resources& Questions
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Digital Leadership Manifestodetails at www.infonomics.com.au25% off pre-publication purchases