Analyst Outlook: Beyond operations to contribution

It should not be so, but a CIO’s success or failure is often based on peer perceptions.

Control those perceptions and you control your right to a seat at the executive table.

It boils down to being able to effectively articulate your contribution to your peers. By investigating the practices of 20 CIOs, we’ve found that successful CIOs use a combination of tools to achieve this.

It starts with the use of a four-part scorecard covering various areas of contribution: operational, individual, IS, and enterprise. What follows are examples of how contributions can be measured in these four areas.

Operational contributions. Operational budgets need to be an agreed percentage of revenue, most likely between two and four percent. Spending on capital projects needs to be directly proportional to the amount of revenue expected from the investment, most likely calculated as return on investment, with the return being in eight months to two years.

Response time is also important. It’s generally construed as a key indicator of operational efficiency against revenue generation. And system availability also rates a spot on the scorecard. Simply put, if the system is not available, revenue cannot be generated, and the business is let down.

Now here’s the hard part. You must also ask yourself, “What else do I need to do? How can I develop my organization? How can I communicate our successes better?”

Individual contributions. After the CIO has signed off mentally on contribution and knows his or her credibility is still intact, successful CIOs focus relentlessly on their interpersonal communication and collaboration skills.

Most CIOs interviewed said that they had long struggled with communicating complex business/technology issues to their colleagues. Practicing feedback analysis and understanding how your peers learn will enhance your ability to communicate complex topics.

For example, if the executive vice president of sales learns by “talking it out” rather than by reading a memo, the CIO can dramatically improve the quality of collaboration with this EVP by “talking things out.”

IS contributions. Generally, a CIO’s reputation is built by the IS staff, so the CIO needs to be a leader in IS staff contribution development. CIOs can track this leadership on the scorecard.

The project management office (PMO) was used in a number of cases to provide a collaborative environment for IT staff and business representatives. This environment provided proof of contribution, mainly along the lines of time, cost and quality. It also provided independent progress reporting and expectations-setting via monthly issues and problem resolutions reports.

Satisfaction surveys topped the list as a key metric. While such surveys might be viewed as an operational set of metrics by most, successful CIOs read between the lines to discern trends in staff development needs, and hence CIO leadership towards contribution.

Deliberate daily, weekly, monthly and annual staff interactions are key practices in IS staff contribution development. They also provide a key learning feedback loop for the CIO to assess what’s working and what’s not working from a contribution perspective.

Enterprise contributions. After considering their personal and IS leadership skills, successful CIOs focus on enterprise contribution. Specifically, they hone in on translating IT metrics into business-contribution language, and ensure that all IT initiatives are aligned with corporate strategy.

Bringing business solutions to the enterprise, whether or not they contain an IT component, is important. These solutions will most likely be business process based, and extend enterprise competitive advantage.

A clear articulation of the CIO’s contribution to the bottom line serves to educate the CEO and board about the transformational value IT has brought to bear on the business.

The contribution scorecard is not a silver bullet, but it can provide a jump start for CIOs facing the need to demonstrate their personal and organizational worth.

QuickLink: 068780

–Andrew Rowsell-Jones is vice president and research director for Gartner’s CIO Executive Programs.

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