By annie shum | February 12, 2010
CIOs need to redefine their roles and boundaries in today’s age of lean IT and customer-centric business.
By Bob Evans, InformationWeek
“IT’s become more of an obstacle than an accelerator. . . . Our CIO’s nickname is Dr. No. . . . Our IT department won’t support iPhones—they just pretend iPhones don’t exist . . . . Our CIO seems more concerned with not offending our vendors than with delivering what we need. . . . How is it possible that we spend 80 cents out of every IT dollar on internal stuff? . . . . Why don’t we just outsource the whole flippin’ IT operation and get far better service while also saving millions of dollars?
“Come to think of it, all this outsourcing and managed services and cloud computing raise a good question: do CIOs still matter?”
We’ve all heard these comments, occasionally misguided but often right on target, from our own companies as well as about other companies. Some of us took them to heart and set out to create a new mission for IT, a new sense of discernible business value and assertive leadership and intense business focus. Some of us, but not everyone.
Whether it’s fair or not, many CIOs and their IT organizations are now considered guilty until proven innocent: their colleagues, rightly or wrongly, have bought into the fairly brutal stereotypes outlined above in the first paragraph and therefore expect IT to be slow-moving and insular, defensive and expensive, out of phase at best and out of touch at worst, and a chokepoint rather than accelerator for the rapid movement of new ideas and innovative processes throughout the organization.
Again, it’s important to recognize that while some CIOs and their teams might richly deserve such reputations, many and perhaps most do not. That perception problem is then compounded by today’s financial challenges and technological innovations: bottom-line performance is more essential then ever, and waves of new high-impact IT stuff—from the cloud to mobile to open source to China’s rise as a global cyberterrorist—must be factored into IT strategies that are already crowded and complex.
So what’s a talented and diligent and market-oriented CIO to do: write letters to the editor? Get the hell out of IT and become a forest ranger? Consult the anti-bullying lobby?
I’d say there’s one and only one good course of action for you to take, and it’s the one that’s always been your best and most-effective approach: rededicate yourself to driving business value, to dazzling customers, to torpedoing bloated infrastructure and unproductive people, and to inspiring your CEO and your CFO to go to sleep every night thanking their lucky stars that you and your team are on their team.
In the past year, we here at Global CIO have pushed this theme in various ways because we continue to see the situation getting worse rather than better, and it’s our charter to help provide you with the ideas and analysis and insights to be as successful as possible at your incredibly demanding and world-changing jobs. And before offering my 10-point proposal for how you can give an unmistakably affirmative answer to the question, “Do CIOs Still Matter?”, here’s a quick list of four of our columns that have hit on this broad theme of The New CIO:
Global CIO: Welcome To The CIO Revolution: A New IT Manifesto
Global CIO: The Top 10 CIO Issues For 2010
Global CIO: JetBlue Genius And Hollywood Lunacy: 5 Essential Lessons For CIOs
Global CIO: Six Lessons CIOs Must Learn From Coke’s Dazzling Innovation
So amid today’s broadly unsettled business environment, and with particular focus on redefining business-technology strategies to drive unprecedented levels of business value, here are my 10 ways for CIOs to prove that not only do they still matter, but that they can be more vital and strategic than ever before: 1) Get out in front of the cloud. Cloud computing is happening, it will accelerate, and it will lead to significant changes in the ways businesses depend upon and leverage IT capabilities. So it provides exactly the sort of strategic issue for which CIOs need to aggressively take responsibility: educating and informing C-level peers on what the cloud is and why it can benefit the business; stimulating discussions on business breakthroughs and unprecedented potential a cloud approach can unleash; and connecting business leaders with top cloud providers to tap into that experience and hear first-hand what other customers have achieved as well as what problems they’ve encountered. DON’T wait for someone else to lead this parade—seize it, own it, evangelize it.
2) Showcase The Great 80/20 Back-Flip. As with the cloud, you and your team must aggressively and passionately lead the effort to gouge costs out of internal systems and operations to liberate precious IT funds for customer- and growth-oriented projects. Since the outcomes will benefit the entire company, engage the entire company to help come up with ideas and approaches for LTCOI: Lowering The Cost Of Infrastructure, and *show them* in unmistakable terms they can accrue. Set up an uncomfortably transparent internal website that let’s everyone see where the current IT budget goes, why that status quo is deadly, and how it needs to be reversed. Spread some sunshine in those damp and murky and buggy corners, and let the best disinfectant help you drive innovation and major change.
3) Explore And Exploit Key Internal Leverage Points. In one of the top business-technology stories of 2009, Coca-Cola introduced an extraordinary new beverage dispenser that’s jammed with leading-edge IT gear and abilities that combine to give Coca-Cola business customers vastly more high-value information than they’ve ever had before, while also giving consumers what they really crave: choice and customized options. Coke’s IT team worked intimately with the company’s R&D group for four years to develop and launch this breakthrough product, called Freestyle. But here’s the killer: it’s the first time in Coke’s history that the IT team ever collaborated with the R&D team! And something tells me that Coca-Cola is not alone in having this type of absurdly disconnected history—so be honest with yourself and identify internal groups with whom you could do great things together.
4) Create The Unbalanced CIO Scorecard. No, that’s not a description of your mental state; rather, you have a VP of IT infrastructure plus individuals directors for network operations, enterprise applications, mobile business, and security. So you don’t need to be The Infrastructure Guy and you don’t need to be pulling cable in the new server room and you sure as heck don’t need to be spending more than 3 hours a week reviewing SLA compliance. But you do need to know more about how better IT engagement will delight your customers, and you do need to have a plan for wringing 15% of the cost and latency out of your supply chain, and you do need to be able to deliver a thorough and business-centric review of your company’s security and privacy capabilities and exposure in these times of China’s unprecedented cyberterrorism. Your outlook is currently unbalanced due to too much emphasis on IT; swing it back to the other side by redoubling your efforts toward technology-enabled business growth and customer intimacy.
5) Stop Being A Historian And Start Seeing The Future. Too many businesses today stumble into trouble and devastating consequences when they reveal their institutional blindness toward what’s coming, what’s over the horizon, what’s around the corner. When it comes to telling you what’s already happened—to rationalizing the past—they can paper you over with document stacks a mile high, but are clueless when it comes to foreseeing what the future is most likely to bring and enabling good decisions based on that foresight. Predictive analytics is becoming a white-hot field in 2010 and, as with cloud computing, if you’re not in position to be a primary driver for your company’s strategy on how to harness that power and which tools and tools and partners to choose and how to assess the new capabilities that a forward vision can bring, then what do you think your CEO will answer when asked, “Does your CIO still matter?”
6) Drive Transformation, Not The Status Quo. Some CIOs have spent the past 15-18 months locked in their offices with the curtains drawn, feverishly finnessing spreadsheets to comply with the CFO’s demands for cost cuts. And within the overall CIO universe, this portion—and while we can hope it’s down to about 25% or less, that’s still far, far too high—has not given any thought to longer-term strategic consequences as long as the CFO target was met. Short-sighted, scared, and selfish, these CIOs have squandered a great opportunity to spark meaningful change across the IT organization because they were most concerned with job preservation and kept repeating their mediocrity-loving mantra: “give the CFO more than he asks for, make no waves, take no chances, keep the head down and the door locked, and maybe just maybe I’ll survive this.” To me, this is the most deadly of all CIO sins, and the way to redemption is by setting an example for how a radically transformed IT organization can not just reflect but greatly amplify other significant changes from across the organization.
7) Lead The Social Upheaval. Social media aren’t the solution to every problem and, yes, they introduce some additional complexity. But you know what? You can say the same for PCs, and for Blackberries, and for spreadsheets and everything this side of stone tablets. The argument must center on what is taking place out in the market and among your customers and prospects and not on what will make life less complicated for admittedly short-staffed IT teams. So don’t fight them—embrace them, lead the effort, and jump in with both feet on Salesforce.com’s new Chatter beta—it will change forever your view of social media as silly toys.
8) Be A Business-Model Buster: Oh, sorry—are CIOs not supposed to be involved with business models? Are CIOs supposed to just sit quietly with the other back-benchers until told what to do? Is your job limited to strictly “supporting” the business rather than helping to drive it, change it, shape it, and grow it? Well if that’s what you think, then please change your title to IT Director and step out of the way to make room for a real CIO who’s interested in applying deep-domain industry and and IT knowledge to pricing models, distribution channels, new partnerships, new logistics possibilities, online promotions, product packaging, and more. If you don’t think this is part of your job, then you’d better have a time machine handy to take you back 10-20-30 years, because this is what CIOs will be made of from here on out.
9) Revise Compensation For The Entire IT Organization. Tie all discretionary income—not 2% of it or 40%, but all of it—to business outcomes: revenue growth, profitability, customer engagements, product rollouts, customer loyalty, etc. SLAs are and will be important but they are not strategic—they’re just not, and you need to stop treating them as such. When the IT team is paid according to a whole different set of metrics than the rest of the company, is it really a surprise that everyone else treats you as detached outsiders who are disconnected from the core business?
10) Expand Your Executive Sponsor Role. Like the other C-level folks, you’ve got a couple of customers for whom you serve as the executive sponsor, the first line of contact for serious issues. But think back to 2009 and evaluate what sort of job you did for those customers: on your list of your top 5 priorities, where they #14? Were you a passive sponsor—answering questions and complaints as they arose, attending the opening of the new facility, going golfing a few times—or did you have your top web-operations person spend a week with that customer offering suggestions and feedback? Have you gone deep with them on how tighter IT-enabled connections could lower their costs or increase their speed or, heaven forbid, get them to spend more money with you? CIOs who matter will be aggressively and deeply engaged with top customers—make this a priority.