The role of the CIO in Digital Transformation. Introducing Digital Product Management

Xavier Serres Escoda, CIO Danone Brazil & Digital Marketplace Product Group Leader Americas, Danone

 “Only” 13 years ago. Do you remember how you used to plan your holidays, consumed media content, or communicate with your friends? It’s rather difficult since at that time neither Airbnb, Spotify, Netflix, nor Instagram did not exist, or at best, were at a very early stage of their successful journey. The disruption that we all faced with the arrival of these tech-based services was a real Digital Transformation for mankind and, sooner or later, this arrived in all our companies.

Digital transformation is driven by innovations that changed the traditional power balance in most markets and also in our personal sphere. Suddenly, we consumers increased our influence and power when we became Internet actors and started rating products and services. Moreover,  companies need to be ready to face new competitors migrating from other markets. Nowadays we can all innovate by taking fewer risks (cloud computing, low-code, etc), accelerating, and democratizing innovation itself. Thanks to technology we have more data and, nowadays, data is more available than ever … Hence, different markets and companies might be forced to rethink their value proposition to survive and stay competitive.

To sum up, I would say that digital transformation is not about technology but about business and the way we adapt our business to social changes driven by technology; Creating new corporate strategies to succeed in such a volatile environment and new leaders that would digitally operate our companies.

How should the CIO adapt him/herself? First, we would agree that Digital Transformation is both a challenge and an opportunity for the CIO: the challenge comes when the CIO and the entire IT department are demanded by the whole organization in areas that were traditionally out of our scope. The opportunity comes exactly in the same direction.

In this new environment, we quickly learn how our old ways of working are not matching anymore with today’s business requirements: Now it’s easier to innovate, but not with the classical waterfall, data is more available than ever but businesses do not know what they need from all these data and without accurate requirements IT is lost. Digital Transformation is the final trigger for IT departments to evolve.

And when we, CIOs, embrace this reality, is when we can materialize the opportunity. Walking together with business -when not leading- on the digitization journey will portray IT departments as enablers for value creation, not any longer as a cost in our P&Ls.

Hence, we will need to focus on value creation and will require to be customer-centric. It’s not about IT departments having to deliver requirements anymore, instead, it’s about co-building a product or service to solve a problem. It’s not about IT delivering a project and immediately transferring ongoing activities to a partner and moving to another project with associated transfer gaps causing a lack of knowledge efficiency opportunities instead, it’s about building a long-term product lifecycle that will generate greater engagement with its business. With this in mind, I’d like to introduce the concept of Digital Product Management as a framework to achieve this new step in IT department delivery.

A digital product would be something we’d like to sell to the market because it adds value to its customers, suppliers, employers, or its internal business functions. It’s a value capsule that we’ll manage considering the product’s entire lifecycle, co-owning it with the rest of the business to maximize its generated value.

So, now that we don’t have a go-live date (because we’re product-centric, not project), where everything needs to be ready because we’re managing the long-term, we can plan a first partial delivery to validate the hypothesis, get feedback, and develop our product to a second incremental step. 

Having periodic and frequent deliveries will be beneficial in a number of scenarios: generated value can be confirmed or the roadmap could be adjusted, the risk is reduced since the number of changes introduced at every iteration is smaller, feedback on ways of working can be applied to maximize efficiency and team well-being, and finally, customer’s needs are more easily fulfilled.

A key role in this transformation is the Digital Product Manager (Product Owner in some organizations). The main purpose of this role is to have a permanent focus on the product, and especially, on the problem that should be solved. This is a hybrid role that must navigate between business functional understanding and technical delivery. Digital Product Manager must create genuine connections with business stakeholders to capture the value to be delivered and then work with technical roles to translate them into features. It also has to create certain conditions that will allow the team to feel they’re solving a problem, not simply coding specs. 

Some of the required soft skills for a DPM would be Passion for the product and its customers; Transparency to build genuine connections with stakeholders that we previously described; Curiosity to stay connected with new market or tech trends that would increase value for his/her product.

“Pivoting to Digital Product Management could help develop the existing IT functional roles to transform IT departments and become the Digital Transformation enabler, which all companies are looking for.”

A common discussion is the possible allocation of all of these roles: IT? Functional business areas? A specific area?

I personally envision an opportunity for all of us, to play the CIO role: If we believe DPM will bring value to the company and our customers, let’s start working on it little by little, however, without hesitation. Consider DPM as our product, building a first version of it and evolving the concept together with business, if long-term the digital product managers are transferred to other areas or a new area is created, It’s fine: the company will be embracing the concept and IT will be perceived as the key enabler for its transformation.

Digital Transformation is bringing an excellent opportunity for IT departments to shine and show real value for their organization to evolve current business models into others that will maximize value for customers. Hence, adapting traditional ways of working into more collaborative and reducing risk through frequent incremental deliveries. Pivoting to Digital Product Management could help develop the existing IT functional roles to transform IT departments and become the Digital Transformation enabler, which all companies are looking for.