IT must be a catalyst for competitive advantage. Future IT departments need to take a completely different role than today. They need to have a key role as a strategic partner and work more with product development, among other things. Someone who has long recognized this and successfully made it work is Kenneth Verlage, with a background as Global CIO and CDO within several organizations including PostNord, DHL, and Munters. He participated in the latest Implema Meets in Stockholm and shared his experiences and insights.
We took the opportunity to ask a few additional questions.
Hello there, Kenneth Verlage, you recently spoke at Implema Meets in Stockholm about how to extract business value from IT. What do you mean by “value” in this case – and what’s the recipe for success?
There are naturally several values, but the ultimate value as I see it is the digital value that can be added to the product you sell. In other words, how you use new technology to make the product better for the customer.
The recipe for success is to dare to think differently about your IT department and have two types of IT. Partly the traditional staff function that primarily deals with the major systems, and partly work in parallel with what I call “business IT.” This happens closer to production and near the customer to get an inside-out perspective. To ensure that you’re solving real problems for customers and production.
You talk about three guiding principles that are important in IT work – what are they and why are they important?
The three guiding principles are pretotyping, simplicity, and an agile approach. Pretotyping is a methodology from Google for quickly and cost-effectively testing whether an idea or product has potential before investing time and resources in full development. You create a very simple and early test of an idea to see if it works in practice. If there’s real demand. The goal is to verify “build the right product
Simplicity is about not overcomplicating things. Launching small, very simple applications and then improving them. Quick and dirty is okay.
Last but not least, you need an agile approach for real. Not just the methodology with sprints, but working very customer-focused, flexibly, iteratively, adaptably, quickly, and with continuous improvement. All to be able to develop, implement, and deploy quickly.
You also talk about the “magic that emerges at the interface between IT and business” – what kind of magic is that, i.e., what are the more concrete benefits of working this way?
By that I mean the innovation power that’s unleashed when you work this way. Business and customers have many insights about opportunities and “friction points,” and IT has many of the solutions. When you get these to collaborate, an enormous innovation drive emerges.
