During a recession, it’s all about business process efficiency (cutting costs, while maintaining or improving quality of services). If successful at reducing process and cost while maintaining or improving quality, higher profit margins are realized once the recovery kicks in. Streamline. Leaner and meaner tomorrow. Period. That’s my opinion.
CTO/Enterprise Application Developer
I’ll echo John’s sentiment, and extend it to say that his answer is applicable to the CIO of any company and not just in tough financial times.
Remember: the CIO is responsible for developing and implementing the processes with sufficient lead time such that the company is able to execute on the future strategy developed by the CEO. The use of technology is just the means to an end, since IT (when used properly) can yield much greater efficiencies than the same processes executed manually.
The point is that the role of the CIO is not one that is necessarily firmly entrenched in the use of IT. IT is simply used to accomplish the goal of allowing the business to execute more efficiently, thus increasing the shareholder value since margins will grow as a result.
A CIO’s role is very unique in a company because it’s the only position where the person needs to understand technology and new trends as well as understand their buisness. I think a lot of past problems in companies stemmed from CIOs (or anyone in a C role), being highly technically saavy but not having the “hands on” knowledge of their buisness. A great example is health care. How can a CIO make a positive impact on technology choices within a health-care system if he/she hasn’t had sufficient exposure to to health-care technology? I believe that the future of CIOs will be more area-focused, where people will “toot” their own expertise in their chosen IT path. I think the days of a general computer science degree or MBA are going out the window and hands-on relation to a field as well as technology that adapts to it are becomming more of a demand.
Sales and Marketing Manager – Tanis Technical – Validation, QMS, Electronic Records Management
We all know that is easier to retain a customer than get a new one. Every strategy needs to be focused in maximizing the yield of a customer (cross-sales), making him/her feel good, giving him/her better rates, better chances to do businesss with us. Each strategy needs to be expressed in terms of financial and operative risk. So the asnwer can be, the knowledge of risk management and cross marketing. Technology is just a must-have!
CTO (TI and Operations) at FinLaguna S.A. de C.V. SOFOM E.N.R.
Good CIOs understand that IT is NOT the means to success for a business, but can certainly help or hinder an organization’s financial prosperity. If anything, CIOs in struggling industries need to be exceedingly critical of technology in general, and avoid investing in new products that might not lead to real productivity improvements. In fact, there are times when it makes sense to make short-term IT decisions to conserve capital that might not make sense from a long-term view.
As an IT manager at a small startup that had cash problems in the early ’90s I found myself canibalizing parts from some PCs to repair others, and nursing along old mini-computers that really needed to be replaced simply because we didn’t have the money to buy the things we needed. It was better to waste my staff’s time keeping the old systems running than to make an up-front capital outlay that would keep us from making payroll.
It is also important to be willing to consider technologies and solutions that you may otherwise have ignored when money was looser. Take another look at open source, or online alternatives to traditional expensive applications.
Heck, IT managers can even get very creative in utilizing the labour force for a lower cost. For example, there are plenty of unemployed IT professionals willing to do volunteer work, or internships, just to make contacts and keep up their skills (I myself have been volunteering to do free IT work to improve my skills). Why not bring more of these free labourers into your organization to reduce your costs even more?
Marketing Director at IntranetSites
Look how IT change can affect an organization. Too often we see paper processes just replicated and put on computers. You should examine not how things are done, but how they can be done more efficiently.
In addition to the financial know-how and the ability to run leaner without sacrificing quality, these conditions will expose the skills of a CIO to manage his peers. During a financial crisis, IT comes under increased scrutiny as a cost centre, and well-intentioned “interference” from other BU heads can hamper IT’s ability to deliver. This is even more highlighted in a financial services company where money is not just the bottom line, it is most lines!
The ability to harness the right business sector expertise in selecting financial services IT applications that provide a competitive advantage is critical.
It is also very important in such times, though, to address IT risk as it affects the whole organisation, and again, financial services is all about managing risk effectively. You want to know that your CIO is a promoter and perhaps leader of ensuring up to date business continuity plans are in place. This is the time when you can least afford a disaster with no plans. The predators will pounce.
Finally, this is potentially a time of change for IT organisations and their customers. Therefore strengths in organizational change are vital for all CIOs. The heavy-handed approaches of the last century have been shown up as not the best way to manage times of change. So a CIO needs to either have those strengths themselves, or, in medium to large organisations, they need the ability to select the right “support crew” or “assistant coaches” (i.e. his direct reports, consultants he/she engages) to supply those skills.
Director of Consulting at Silversix (IT Performance Improvement Experts)
If this CIO was waiting for a global recession before developing and IT strategy you have a problem already.
Any IT strategy would need to be a product of business strategy. There should be a business strategy in place as well so there should as a consequence be an IT strategy.
The CIO should constantly be reviewing with the business leadership what the business strategy is, how has it changed, what would they like to explore, etc. Then take this back to the shop and analyze it and understand what IT direction and changes would need to be planned to align there. In IT that means CTO, Enterprise Architecture, Infrastructure, PMO, etc., to define the changes and required strategies to meet business expectations and requirements.
Getting the best bang for the buck should be a daily process and not just a strategy for a CIO. By default, every senior manager under the CIO should be addressing this point.
You may also add external consultants and supplier reps to the list as you shop ideas around to see what is and what is not possible, and the costs involved.
Executive Technology Management