CIOs never really have it easy. They may not have the influence of a CFO or the authority of a CEO, yet when things go awry, as they so often do, they are frequently the scapegoat.
According to Keith Powell, ex-CIO of Nortel Networks and head of Keith Powell Consulting, it is time for CIOs to take more of a leadership role. He gave this advice recently at the Informatics 2000 conference in Toronto. Fortunately, today’s CIOs have the advantage that information requirements are growing exponentially, as e-business raises the understanding of the strategic value of IT, he said.
“Technology leadership is really tying to creating business value for the organization, and I think that has to become the CIOs agenda,” he stressed.
“The challenge that we all have as CIOs, I believe, is changing and that responsibility is shifting to becoming a first mover in the implementation of new technology,” he said. “We can no longer sit back and think that we can be a follower.”
Powell said if CIOs are not the first mover somebody else in the company is going to step in and take that role from the CIO.
He cited his experiences at Nortel as an example of a more proactive role to create a successful relationship within the organization. “The CIO and the senior executives in the IS organizations must become the leaders for IT for their corporation.”
As companies move toward information and knowledge management, Powell said this “is where you really start to create the dollar impact to your organization.” Though this is not always easy. User communities are sceptical of the risks introduced by bringing new technology to the table, he said. Many CIOs have experienced overrides in budget as they try to drive new technology into the business process. But giving a dollar value to an initiative is often difficult.
“I think it becomes very difficult sometimes to measure a business case on [successfully bringing in new technology],” he added.
Powell outlined four case studies of IT implementations at large technology companies, starting with his former home, Nortel.
The challenge there was what he called strategic redirection, establishing a common infrastructure around the desktop.
“This was very important because up until that point the IS organization didn’t have a lot of credibility,” he explained. The common infrastructure was the first phase and Powell found the business people at the company had trouble buying into the idea until the IS organization proved it had the capability to move forward on the plan. That hurdle successfully overcome, phase two (still ongoing) is to move on to common data and processes. This phase had a clear business agenda. By consolidating the IS service and collapsing the infrastructure, huge cost savings were driven out of the organization.
Regardless, it was a process that required a first mover. “The corporate push for data networking demanded that somebody step up to the plate and take on the role from the corporation’s perspective,” he said, adding that this is the job of the CIO.
And like life in general, “each success really does set the stage for being able to move forward to the next stage.”
The challenge at Sun Microsystems was slightly different. “This was an example of test bedding and implementing a product that they themselves have actually developed,” he explained.
The development was Sun Ray, a corporate thin client vision. The goal is to serve 10,000 of the company’s 35,000 employees with Sun Ray. The business case was the savings to the IS organization in terms of reduction of support costs while an added benefit was strengthening the partnership between the Sun IT organization and the internal organization that was developing the product.
Here too were image hurdles to overcome. Many at Sun thought Sun Ray was too lightweight to do the work of a full PC, but the cost savings (both in capital an support) eventually won departments over.
Linking IT with products
Hewlett Packard’s situation was almost the opposite of Sun’s. Its implementation was a sophisticated print management system gained via a corporate acquisition. The technology allows many applications to publish directly onto the Web. “It wasn’t a whole-world HP solution so it ran into a lot of resistance around that and because of its decentralized nature, [backers] really struggled with moving forward with the implementation,” he said.
This case also had a silver lining. “Building a strong linkage between IT and product development again was one of the results that came out of it and helped the IS organization in HP build their credibility,” Powell said.
The final case study was Microsoft Corp. The company’s Redmond, Wash., campus is introducing a wireless infrastructure to about 70 per cent of the population.
“Employees of high technology companies want access to the latest technologies so, to them, access is equal to credibility and the IS organization, in order to maintain credibility, had to step forward with this kind of technological innovation,” Powell added. “So it is really a case where the IS organization was much more focused on employee satisfaction and driving productivity as opposed to looking at it as a cost savings around a business case.”
It is still a work in progress, but it has given the IS people a chance to better understand the performance and security requirements surrounding this sort of implementation, he said. “The biggest thing that they found is user education and support is an absolute key to deployment of any technology like this,” Powell said.
And the lessons learned? Number one: delivering basic service is critical, it is what gets you your credibility. Powell also saw the need to reign in the cottage organizations within the company. And, of course, securing the CEO’s commitment is paramount.
Finally, the last lesson is based on culture. IS organizations need to create the right cultural mind set around IT activity by letting employees know that part of success comes from pushing the envelope, but in doing so there are going to be occasional problems. Powell added that IT must live up to commitments but also be prepared to take some of the heat when things go down, as they are prone to do.
And remember “business has to be the driver for process change, IS can be a supporter to help but it must be the business that makes that happen,” Powell concluded.