In its Leadership vision for 2022 CIO presentation in September 2021, Gartner reported a worldwide trend. According to the research firm, organisations had been undergoing digital transformation since 2015 – and earlier for some industries. And this trend requires a shift in the way the chief information officer (CIO) operates.
This revolution picked up speed during the pandemic. Gartner industry analysts attributed this acceleration to an increased emphasis on digitisation to compensate for business disruption caused by Covid-19. To sustain this flurry of innovation, CIOs will need to work with business leaders more closely than ever.
Sweden is a good example of how this change has happened. The position of CIO has gone from being a reactive role 15 years ago, very often reporting to the chief operating officer (COO), to a proactive role that is central to the business and reports directly to the chief executive officer (CEO). The same trend is occurring in virtually every industry and in all industrialised nations.
Some of the drivers are technological – including improved cloud services, better data science techniques, and more effective cyber security measures to fight off more sophisticated threats. More and more organisations are taking advantage of the features that are now available through cloud computing. Data science has matured to a point where information can be used across an organisation in ways that were never possible before. And of course, along with the new ways of using data has come new regulation around data privacy and security.
Other drivers are business-related – increasing digitisation across industries, growing customer expectations, and hybrid work environments. Customers are used to digitisation in different parts of their lives and have come to expect it in all industries. Digital transformation is enabling new business models designed to meet ever-growing customer expectations. Employees now expect to be able to work partly from home and partly in the office.
There are other drivers for change in the CIO role that are specific to Sweden. There is a talent shortage, which is occurring in most developed countries, but has specific characteristics in Sweden. Meanwhile, economists expect a difficult period for startups in the near term because of a change in investor mindset. This turmoil may drive skilled Swedish professionals to safer work environments.
The other important development in Sweden is the country’s decision to join Nato, which means its cyber security needs to be strengthened. Threats will become more sophisticated and more numerous. Companies such as Telenor, which offer fundamental services to the country, need to be particularly vigilant.
The CIO as trusted business partner
In some cases, CIOs are seeing their position diminished within their organisation, leading some observers to suggest that “the golden age of the CIO is over”, as Johan Magnussun, director of the Swedish Center for Digital Innovation at the University of Gothenburg, told Computer Weekly.
“Over the past couple of years, CIOs have undergone a decrease in organisational stature and clout,” he said. “They are more and more moving into solely focusing on maintenance of the infrastructure, and digital transformation is more and more off the table. Instead, this is handled in a decentralised manner, coordinated through CDOs and other functions.”
But some CIOs are rising in stature within the enterprise. For example, Kristin Lindmark, who saw the shift first-hand in banking and insurance, where she was CIO of SPP for nearly eight years. She has since moved on to the telecommunications industry, where she is CIO of Telenor Sweden and continues to observe the same trend.
“Digital technologies are now key in all industries,” said Lindmark. “As a result, the CIO role has been changing for over a decade and the change has been even faster over the last two or three years.
“IT was a kind of support function in the past, but in financial services and telcos, for example, IT has been a central part of what companies in those industries do. I think you see this movement from being a support function to a more central role in virtually every industry now.”
Lindmark reports directly to the CEO of Telenor Sweden and reckons that if the CIO doesn’t report to the CEO, it’s a clear sign that the organisation doesn’t consider technology important. Digitisation is a crucial part of any business today, which means the IT leader needs to sit at the same table with the other leaders of the organisation, she said. The IT leader also needs to be a partner to business leaders and develop mutual trust with them.
“With the growing availability of cloud services, shadow IT sometimes becomes a problem,” said Lindmark. “Sales managers might subscribe to SaaS [software as a service] applications without telling the CIO. You don’t want to be the police or the internal guard. You need to have the business perspective in what you do. That will help you avoid some of the problems. Pay attention to what the business leaders are trying to accomplish and find ways to deliver those capabilities in an efficient way.
“I think we have a high IT maturity in general in Sweden and that, for sure, sets a lot of expectations. We also have a lot of unicorns in Sweden. That impacts consumer behaviours and the expectations on services.”
Lindmark added: “The unicorns and startups also bring an open war on talent because job seekers have a lot of interesting choices. From the CIO’s perspective, you need to have an organisation that people want to work for because the competition is fierce.
“One other perspective in Sweden is that we are in the process of becoming a Nato member – and that, of course, affects the overall security perspective. Security is really important for telcos, and the topic is on our management table in Telenor every week.”
Career path to CIO
The CIO job is still alive and well in Sweden, and an important part of recruiting people into the IT department is to give them a career path that might lead to the top. Many candidates are looking for high salaries in the beginning, but eventually they want to settle down somewhere.
“I don’t think being a CIO is something that you dream of when you are a little girl or a little boy,” said Lindmark. “In my case, I had an engineering background and then a lot of different roles, both on the consultancy side and in line organisation. This allowed me to learn the craft of running IT from many different perspectives.
“I think that to be a CIO, you need to have a true interest in people, and you need to be eager to learn and stay ahead on technology because it’s changing really fast. And then you need a passion for business to really understand what the business is trying to do and how you can contribute with IT. It was a good thing for me coming from 20 years in financial services and going into a new industry. I can bring ideas from one industry to the other.
“Within the IT organisation, CIOs need to be a trusted leader in order to get people to contribute to what you want to achieve, but also you need to discuss a lot with your peers and partners, such as the business partners within your organisation. You also need to be networking outside your organisation, both within your industry and outside your industry to get external influences.”
Lindmark added: “Recruiting IT professionals has been difficult in Sweden over the last few years, especially for highly specialised people in areas such as cyber security, data analytics and cloud computin. But I am curious to see what happens later this year. I think there will be a tendency for people to seek safe havens if they are currently working for unicorns or startups. It will probably get a big easier for stable players in mature markets to recruit.”
Digital transformation: the past and the future
Looking back on digital transformation over the past decade, Lindmark has been part of some successful transformations, such as the one she led as CIO at SPP. But she has witnessed cases where transformation failed. Those that succeed have a solid game plan, stick to their plan and patiently carry on their work as they change their way of doing business, she said.
The digital transformation Lindmark led most recently was at SPP, a leading insurance company in the Nordics specialising in delivering tailored pension plans.
The company’s technological platforms were fragmented, which made it difficult to compete in the market. This dispersed technology also made it hard to comply with the growing amount of regulation around financial services.
The company began digital transformation in 2016, with Lindmark at the helm of the IT department. The plan was to create what it called Future Core – a common platform for data and applications. The shift was not only about changing technology – it was about changing the organisation and most business processes.
By 2019, SPP had migrated 90% of its data onto the new platform and was saving €5m a year. It had also implemented new functionalities that were compliant with regulatory requirements. By the time Lindmark left in November 2021, SPP had completed about 96% of the migration to the new platform.
The new platform allowed SPP to offer products it could not offer before. Its fully digital pension plan was rolled out in 2019 and won the Digital Project of the Year award in Sweden.
Looking back on her experience at SPP, Lindmark said: “These are experiences I try to bring into the modernisation journey at Telenor. The telco industry has great changes ahead with new 5G services and a strong focus on security.”
The CIO also needs to show leadership throughout the journey, making sure business continues throughout the transformation, said Lindmark. “If you are going through this kind of change over a period of years, you need to make sure you don’t become too internally focused during that time. Share what you are doing with business partners. Keep up with customer expectations.”
As for organisations that do not fare so well with digital transformation, sometimes it is because corporate leadership isn’t fully behind the effort and does not provide IT leaders with the necessary resources, she said. Some companies mistakenly believe that the change is a “quick fix rather than a major overhaul”.
Magnussun at the University of Gothenburg added: “Organisations that are performing poorly in terms of digital transformation have a higher frequency of assigning responsibility for digital transformation to the CIO without increasing the budget and resources at their disposal. Executives want to have a quick fix and avoid dealing with digital transformation as a transformative initiative.”
As for the changing role of CIO in Sweden, Lindmark said there will be a big change: “The world is changing fast. It’s already hard to know where you need to be in five years, and it’s getting even harder. Businesses need to position themselves to move quickly.
“You need to make sure you are prepared for the unexpected. That means that you have an organisation that can move fast and that is not so slow to change. You need to have your overall plan, but you need to be sure that you can change course and have an organisation that can move with you.”