By Manish Bahl , Vice President, Country Manager-Forrester Research India
Forrester Research Inc. (NASDAQ: FORR) is a global research and advisory firm serving professionals in 13 key roles across three distinct client segments. The firm has a current market cap of $715.45 million.
Coupled with the current economic trends in India, the increasing demands and expectations of digital customers are redefining the way business is done. Forrester believes that three trends warrant special attention from Indian CIOs looking to transform the role of technology in their firms.
The age of the customer is forcing firms to redefine customer engagement strategies: Digitally empowered customers are forcing firms to redefine their engagement models to survive in the age of the customer, which Forrester defines as:
A 20-year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers.
Indian CIOs' top business priority is to address the rising expectations of customers and improve customer satisfaction; 87 percent of those we surveyed consider it a high or critical priority. Lowering the firm's overall operating costs is much further down the list of priorities. This highlights the general shift in spending patterns at Indian firms, as improved customer centricity overrides lower operating costs. Business leaders want to leverage technology to better engage digitally enabled constituents, fueling a fundamental shift in the way firms interact with customers. Targeting the customer experience requires CIOs' organizations to radically shift focus. CIOs must alter governance processes, job descriptions, IT performance metrics, and even the technology management organization's culture.
The business is getting increasingly involved in technology decisions: As the boundary between IT and business further blurs, business units are getting more directly involved in technology discussions as a means to differentiate their organizations and drive business growth by transforming the customer experience (see Figure). Given the pace at which digital disruption is happening, business-led technology decisions will get further attention from Indian firms in 2014.
The tough economy is putting more attention on customer-focused business outcomes: The difficult economic landscape has forced Indian firms to look for new and innovative ways to create efficiencies, improve customer responsiveness, and drive business growth. They are looking for ways to apply technology to deliver targeted business outcomes - such as increases in customer acquisition rates and customer satisfaction - faster, better, and cheaper. The pressure is now firmly on CIOs, as the ability to connect technology investments directly to business outcomes has become a critical factor in determining their success.
Take three immediate actions to survive disruption: While CIOs must still devote significant time and energy to maintaining existing IT infrastructure, current economic trends and the increasing demands and expectations of digital customers are redefining the way business is done in India. Digitally empowered customers are disrupting every industry and CIOs must adopt a holistic approach to these rapid changes. You can not just hire a business/IT relationship manager and assume that you have bridged the customer experience gap. CIOs and their organizations must radically shift focus and alter governance processes, job descriptions, IT performance metrics, and even their cultures. To respond to the age of the customer, CIOs must take three immediate actions:
Add a BT agenda to your IT agenda and develop customer-focused business outcome metrics: BT is the technology, systems, and processes that companies use to win, serve, and retain customers. Every member of your team - including enterprise architects, infrastructure and operations professionals, application developers, and security and risk professionals - will work on both BT and IT. For instance, the BT agenda for application designers and developers can be directly linked to enhancing the customer experience. Once your tech management organization has a BT agenda, you need customers, financials, and system-of-engagement metrics that track technology's contribution in customer creation and retention, link BT to your firm's revenue and profitability growth, and enable BT to serve customers and sustain connections.
Invest in technologies that are on the BT agenda: CIOs will need to invest in less mature yet rapidly evolving technologies such as social, mobile, customer analytics, and customer experience management for superior customer interaction. BT will provide innovative industry use cases as companies find ways to intercept and engage empowered customers through digital interfaces, devices, and services.
Prioritize BT with your IT service provider: As you add a BT agenda to your team's metrics, you will need to re-evaluate your vendors relationships and make them BT-relevant; it's important that you add a customer-focused BT agenda to your vendors' performance metrics. You should also be willing to work with a range of partners: Traditional vendors will maintain their focus on IT service delivery, while the next generation of service providers will understand how they can better support business services. CIOs should be willing to assume the risk of working with new vendors in the market to foster innovation with the aim to de-emphasize products and services in favor of business outcomes, as business results - not products or solutions - differentiate CIOs in the eyes of business executives. (This article is a summary from Forrester's "India Tech Market Outlook: 2014" report.)