How a New CIO Used Best Practices to Revamp a Diverse Conglomerate

KCT Group is a New Delhi-based diversified conglomerate interested in real estate, logistics, finance, and aquaculture. In September 2023, Badar Afaq took over as the Group’s Head IT. With a focus on modernising the group’s IT infrastructure, Afaq gained the support of top management for his IT strategy by outlining a comprehensive plan that addressed the group’s legacy systems and prioritised digitisation, IT governance, and enhanced IT setup across various business entities.

As a new CIO, here is how Afaq identified key business issues, selected priorities and established some immediate wins.

Benchmarking IT

Upon joining the organisation, Afaq conducted a thorough benchmarking of KCT Group with similar companies to understand their IT infrastructure and best practices.

His goal was to identify gaps in ICT service delivery and areas for improvement. He also reviewed the organisation’s ICT maturity against industry standards and best practices. Armed with insights from this initial review, Afaq was able to identify the IT solutions and processes that needed attention, and prioritise actions.

This approach helped him to identify gaps in ICT service delivery and areas for improvement, ensuring that the organisation is aligned with industry standards and best practices. 

“In terms of IT, the Group is characterised by mostly legacy systems, with some applications and basic SharePoint portals used in silos. To address this, we will implement an integrated one-stop solution, such as an ERP, tailored to each business. There is also a need for independent IT setups for each group company, ensuring that any impact on one business’s IT does not affect other businesses,” says Afaq.

According to IBRS, the benchmarking process should focus on measuring and understanding what is important rather than what is easy. The important metrics are those that enable managers to make changes to increase efficiency (i.e. reduce cost or time) or increase value. More sophisticated companies use process benchmarking to discover best practices and adapt what they learn to gain operational, strategic and financial advantage. Inherent in this view is the willingness to transcend the ‘not invented here’ culture. It means embracing a culture of finding and adapting ideas and techniques from outside the organisation.

Engaging with Stakeholders

Next, Afaq engaged extensively with all stakeholders across the Group to understand their pain points and identify how IT could be leveraged to address these issues. The goal was to gain information that would help align the ICT strategy with the needs of each business entity.

“We are engaging in extensive discussions with all business stakeholders to identify their pain points and understand how technology can be leveraged to address these issues. Our goal is to achieve a tangible ROI by measuring the impact of IT solutions in terms of cost reductions, manpower optimisation, and other benefits. This detailed analysis will take at least two quarters to complete, ensuring that we thoroughly assess the needs of each business entity and develop targeted IT solutions that drive value,” he said.

IBRS recommends a new CIO undertake an exercise to achieve the best possible understanding of the critical business functions that the ICT underpins. As a minimum, find, read, and comprehend legislation that impacts the authority of or operation of the organisation. 

A useful tip for new CIOs is to review the organisation’s last two annual reports, and the current business strategy and corporate plan. New CIOs should also determine the ratios of expenditure across the organisation (HR, front office, ICT, etc.), the cost of operating the business and the cost of running ICT as a proportion.

Armed with a documented understanding of the organisation’s business focus and operational finances, CIOs should take the opportunity to speak with and visit the organisation’s shopfront (whether that be a bank, an industrial complex, or a government office) to verify their understanding. As demonstrated by Afaq, gaining an understanding of staff pain points as well as uncovering where ICT can either be improved, or improve the business processes is the ideal way to engage with the organisation early in the ICT planning phase. It not only provides valuable input for the strategy, but also builds stakeholder support that is essential.

Prioritised IT Governance

Afaq also recognised, early on, the need for robust IT governance processes, including cyber security, data security, data retention policies, and data loss prevention (DLP). He began a program of work to strengthen these areas. This demonstrated his commitment to ensuring the security and integrity of the group’s IT infrastructure.

According to IBRS, prioritisation is a key governance capability supporting sound decision-making and allocating limited resources effectively. Organisations must commit to the concept and realise that it is a competency that takes time, reflection, and adjustment to get right. Maintaining commitment and improving the process and outcomes will deliver enormous benefits. 

Organisations needing to evaluate proposals and allocate limited resources should consider:

1. 1. Aligning governance approval for the concept, the criteria, and how negotiations will occur to ensure that prioritisation efforts are not abandoned at the first hurdle. 

1. 1. Reviewing the business case culture of the organisation. Initiatives that have high value but have not been successful in the first round of prioritisation should have support to strengthen the benefits or returns and/or reduce the risks to ensure they are ready if funds and resources become available as the result of a review or initiative cancellation.

Communicate Return on Investment (ROI) and Benefits

Afaq emphasised the importance of effectively communicating the value of IT initiatives to management. He implemented proof-of-concepts (POCs) to demonstrate the potential of IT solutions. He ensured that once management was clear about the ROI, they were willing to invest in proposed solutions.

Afaq’s actions again here align to IBRS recommendations for new CIOs. They need to quickly and clearly articulate the expected business benefits of their ICT plans, such as increased revenue, cost savings, improved productivity, better customer experience, or competitive advantage. Quantify these benefits as much as possible using metrics that matter to the business. 

Importantly, craft the value proposition for each audience, emphasising the specific benefits that are most relevant to them. For instance, the CEO might be interested in financial impact and competitive positioning, while department heads may care more about operational efficiencies and meeting their KPIs.

IBRS also recommends making sure ROI benefits can be audited. If you are going to input a benefit into your ROI analysis that says you can reduce headcount by 20 and by when, it is essential that you can audit the benefit for results. That requires knowledge of how long it takes people to do their jobs before the project starts. It should also mean the inclusion of a 20-person headcount reduction into the operating budget of the eprocurement group and making the successful reduction a part of the bonus rewards for managers and employees in the unit.

To further cement the concept of ROI, Afaq is planning to create a centralised dashboard that will provide a comprehensive view of data across each business entity. This will enable senior management to visualise each business’s key performance indicators (KPIs) and metrics, allowing them to make data-driven decisions and track progress accordingly.

To ensure a seamless transition and avoid any disruption to business operations during upgrades and implementations, Afaq intends to employ a well-planned cut-off transition strategy. This will involve running the new system in parallel with the existing one for a short period, ensuring stability and minimising risks.

Conclusion

Afaq’s initial months with KCT Group are an excellent example of the steps a new CIO takes in order to:

1. 1. Understand the scope and nature of their role 

1. 1. Gain the support of not only executives but also departmental stakeholders 

1. 1. Plan and demonstrate a positive impact on the business 

Based on information gathered from CIO insights and advisory over two decades, IBRS has catalogued the key factors and actions needed for executives undertaking their first CIO role and those moving to a new company. These are available through the IBRS knowledgebase under the CIO Handbook research program for IBRS clients. A complimentary consolidated CIO handbook ebook is also available for download.