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January 22, 2014

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Kyield

Another fine focus Irving.

I'd like to highlight a couple of areas:

“What’s clear from our analysis is that CEOs are looking to the cloud as a source of innovation, not IT productivity. The problem is that the investment profile in many companies doesn't match that priority. Unless companies make that switch, disruptors that use technology to fuel innovation (i.e., like Amazon and other new entrants) are going to drive them out of business.”

This is quite revealing on several fronts. Many CIOs would like to adopt innovation systems, but are being held back by CEOs and boards. An example-- very well regarded CIO in large company just below the top tier responded to me that our system 'was perfect' for his company, but he just didn't think his board and management culture were quite mature enough yet. He is working on the challenge, speaking to need for high level edu, but the problem for his CEO is that multiple competitors ARE sufficiently mature.

Interestingly, in our case it doesn't matter much whether it's on premises, cloud or hybrid from an ROI perspective, rather the choice is quite often being driven by comfort zones and defense, speaking perhaps to the culture and challenge of demising returns on investment. Ironic for those offering decision systems no?

-->While an increasing number of companies are now paying attention to cloud, they have mostly been doing so to improve the economics of IT.<--

“The reason for considering this (cloud) is that so many companies are hampered by legacy technologies that they are unable to be flexible and simply cannot innovate,”

Highlights the problem for CIOs. The reason for being for IT in business decision making isn't even within the realm of many IT decision makers. Many argue that they aren't incentivized or rewarded for anything but incrementalism, but that's quite often what separates future leaders from everyone else--we are all faced with this dilemma in today's economy at some level. Strong leaders may move on, but by definition don't sit back and knowingly allow their organizations to fail.

Incremental IT may be very costly to maintain, but it does not provide a competitive advantage -- the precise same systems are used worldwide, often in competitors working at lower cost levels with other advantages as well--like growth markets. This is the fundamental challenge, of course, that many of us have been working on for decades--continuously adaptive systems are finally at the inflection point. The game is being changed.

CEOs still have much to learn about the complexity at the confluence of IT systems, organizational management and the increasing neural network economy. It requires an exceptional level of commitment over a long duration working at a competitive level few have experienced or prepared for--in no small part due to market power, which is why the not invented here syndrome is so dangerous in this environment, however prevalent.

KR, MM

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