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Fixed legal fee structures that easily create a risk of blowing profit margins.
Inter-market trading and flexible supply chains that lead to increasingly demanding consumers.
Banks interpreting regulations differently – meaning each bank needs a bespoke solution in order to deal with them.
These are the types of real-world process challenges that Shane Scott, IS director for nationwide law firm Shoosmiths, Darrell Stein, CIO for consumer goods giant RB and Joanna Spicer Brown, director with fintech challenger Insignis Cash Solutions, face in their roles as IT leaders and innovators. As technology within businesses has changed from purely operational and reactive into a strategic weapon, CIOs roles are evolving from traditional to transformational. In their recent CIO podcast, Horizon Business Innovation spoke with Scott, Stein and Spicer Brown about their experiences driving constant process modernization and improvement within their respective organizations.
Point solution or pitfall?
As the result of sudden demands like disruptive competition, regulatory changes or a merger, new technologies are commonly brought in quickly to solve the problem. But left alone, these point solutions can often make siloes worse, add to app clutter and create weaknesses in processes.
Shoosmiths, for example, is effectively five full service businesses in one that covers everything from corporate commercial and private real estate, clinical negligence, conveyancing and financial services recovery – and it has the complex IT environment to prove it. “When I joined, we had 13 different case management systems and a myriad [sic] of different document management systems. The specialist legal practice system meant we had separate accounts receivable and separate accounts payable systems,” Scott said. Since 2013, “We have rationalized that down with SAP, which replaced about 16 different systems and we are rationalizing the case management systems and rationalized the business processes as we have gone on. By May next year, we will be down to two document management and two case management systems.”
Walking the line between legacy and innovation
All three CIOs agree that getting the right mix of sustaining solutions that work along with hastening innovation is tricky. “The challenge is squashing your run budget in order to sustain your innovation budget,” Stein at RB says. “You don’t want six-sevenths of your budget to be on run IT, you have got to get it to 50 percent and that is the challenge that we all face.”
Both Scott and Stein emphasize the importance of focusing on ROI when introducing a new technology. “We ask and analyze every single step and every business owner is asked ‘Is this a statutory requirement? If not, is it adding value? If not, then don’t do it,’” Scott says. “The ROI is starting to shorten and that is a business demand. Three years was the norm when I was at Akzo Nobel, now it’s two years or less,” continues the former CIO and program director with the major chemicals company.
Stein adds, “Ruthless prioritization. If a project does not have the right sponsor then I will not do it. I like a track record of success. As a CIO you are responsible for every penny you stick into technology. If you have an unwilling sponsor, then stop and invest in something where you have a good sponsor.”
This approach has helped Scott turn 100 mobile users into an entirely mobile workforce at Shoosmiths, Spicer Brown get banks who run on fax machines and systems from the1980s able to meet Open Banking and PSD2 regulations, and Stein align IT with marketing to mine data that answers the question, “Are we putting the right things in the right stores at the right time?”
Choosing the right technology partner
“I’m sure we all have scars on our backs from picking the wrong horse,” Scott of Shoosmiths says. The CIO cites SAP and K2 as two of his key technology partners. “It is crucial that you find the right partner who can work with you, in the way that you are working.”
“It is all about the team you can get,” continues Stein. “You pick the right partner…you have to make sure that you get the right team and that is all about having the right supplier engagement and making sure they are aligned to your objectives.”
The future of process
It turns out that new technologies, such as artificial intelligence (AI), elicit as much excitement and apprehension from the CIOs as from the rest of us.
“There is a great opportunity for AI and machine learning to make operations as optimal as you possibly can,” Stein of RB says. Yet, for all of AI’s promise, it also raises questions. As Scott puts it, “One of the challenges is the social and professional impact it has – AI has the potential to take out the whole learning process that solicitors go through. AI can do in hours what it takes a team days to do.”
“I am fascinated by it [AI] in legal. I think it is huge, in the back office, the opportunity for centralized invoice matching, in the front office, I think AI can really help you pinpoint where you should be spending your marketing dollars, but there is still an element of human touch required to do selling,” interjects Stein. “Could you provide systems that allow retailers to do their own in-store marketing, as there is a huge sales force that goes out to stores and positions goods – that is a big leap. There are some big changes.”
“AI is making our back office happen and we then see that as something we can sell to other people,” reports Spicer Brown of Insignis.
Stein agrees with Spicer Brown. “Getting systems to speak to each other is a big, common thing. AI can correct that, if you have half a dozen systems all with different descriptions. The old-fashioned way was to create a big master database. The new way is to stick the descriptions, file a report and it finds the commonalities.”
Whatever happens in the future, it is certain that business processes will continue to change and pose problems. CIOs have become key members of their organizations and must react faster and with more wisdom than ever before.