IoT And The New COO Scorecard

Tom Raftery

“Real knowledge is to know the extent of one’s ignorance,” said Kong Qui, better known as Confucius. I doubt he had chief operating officers (COOs) in mind when he said it, but 2,000 years later, he still makes a good a point. The Internet of Things (IoT) is taking us into unprecedented disruption, opportunity, and innovation. Business models are fluid, existing processes are becoming less relevant, and for many, we don’t know what we don’t know yet. IoT is not only changing how we do things, but also the definitions of our roles and our measurements of success – particularly for COOs. If ever there was a time for a bit of professional navel gazing, it’s now.

In the same way that CEOs and founders need entrepreneurial skills to devise new business ideas and create a culture of innovation, COOs must also be somewhat “intrapreneurial.” But that remit is changing from operational to transformational. And not everyone knows how to get there.

In my last blog, I touched on the transformational effect of IoT on almost every division and line of business head in the organization. Here I’ll talk specifically about COOs, because they’re at the digital coalface leading this transformation.

Of course, business transformation is hardly a new concept for a COO, but the seismic impact of IoT has permanently raised the bar. A new playing field with unparalleled processes, potential, and performance metrics is redefining what success looks like.  So much so that IDC has created a scorecard for the new COO remit, giving actionable evaluation measures and advice on how to think and execute differently in the brave new world of digital transformation. (If you’ve not yet seen it, it’s worth a read for the success of your future career, not just your current role.)

As organizations digitally mature, the KPIs for COOs are becoming more closely aligned to the broader organizational objectives with subtle, yet critical, interdependencies. IDC’s COO Scorecard identifies five key dimensions for these KPIs:

  1. Operational vision. The ability to gain active responsibility for technology governance while maintaining fidelity to corporate IT standards and guidelines.
  1. Connected assets and processes. The ability to connect corporate assets to improve effectiveness (inclusive of efficiency, reliability, and availability) and to digitally connect processes, both intracompany and intercompany, to create a more responsive operating capability.
  1. Connected experiences. The ability to support corporate’s transformation initiative based on digitally connected products and services to enable higher levels of customer satisfaction and to unlock information-based revenue opportunities.
  1. Intelligent decision making. The ability to connect corporate strategy with operational decision making, down to tactical plans, on an organizational scale.
  1. Talent and culture. The ability to create an environment where people are committed and enabled to change, where employees at any level move in the same direction promoting the same shared values.

What we are talking about here is essentially changing the COO’s remit from a utility to a transformer – and mastering that change in the process. The real issue is not if a company’s business model will transform (competition and disruption will typically take care of that), but rather whether COOs understand how best to steer the ship while this is happening. I don’t just wish you success in your company’s transformation, but also the digital acumen for you to make it happen.

Check out The COO Scorecard for Digital Transformation to see how you’re doing in advancing your organization’s digital maturity.


Tom Raftery

About Tom Raftery

Tom Raftery is Vice President and Global Evangelist for the Internet of Things at SAP. Previously, Tom worked as an independent analyst focusing on the Internet of Things, energy, and clean technology. Tom has a very strong background in social media, is the former co-founder of a software firm, and is co-founder and director of hyper energy-efficient data center Cork Internet eXchange. More recently, Tom worked as an industry analyst for RedMonk, leading the GreenMonk practice for seven years.