CIO Performance Metrics

In the last few weeks there has been a lot of publicity and visibility on the fact that CIOs are being or going to be measured on business metrics, many of which they do not control or influence directly or indirectly. This sparked many a debates on various forums that attract CIOs, social media sites and groups that are dedicated to IT leaders. Not that anyone tried to contain it, the fever spread globally very quickly with reactions that spanned the spectrum of emotions.

Traditionally IT was measured on three aspects; operational efficiency, budgets, and delivery of projects. The connected world also added information security. Disaster recovery and business continuity surfaced and made it to the dashboard. Somewhere business benefit crept in and then projects were also reviewed from a business angle. Regulatory compliance required significant IT support and thus edged in. But revenue, profitability, customer acquisition or retention, product availability ?

How does the CIO influence any of these ? Can better IT deliver additional growth ? Will technology drive profitability ? What can the CIO do to acquire new customers or retain existing ones ? And what about product quality or availability ? If cash flow is an issue, how will systems ease it ? Competition has a better and cheaper product or a great marketing strategy, can IT or the CIO counter it in any way ? If the answer to one or more is no, then why link performance or compensation to these measurements ?

I know some of the CIOs who have been there done that, evolved beyond technology and/or taken additional business roles will say that the CIO can indeed contribute and influence most of the measures above. This is achieved with systems that create operational efficiency, business process management, information visibility, business intelligence and analytical models, and even enabling new models of engagement with the new trends and hyped technology troika, Big Data, Mobility, and Social Media. Cloud and Outsourcing are passé; everyone has done it or is doing it

It is evident that this piece of news has many people worried, and not all of them are CIOs; they are propagating the message that if I cannot control something, I should have the choice to determine if my performance is likely to be impacted. Fair point if the organization worked in perfect silos. In business and life uncertainty is certain and thus even the metrics that seem to be under control have dependencies – internal and external – which are beyond one’s power of influence.

Does the CEO control how the industry will behave ? Can the CFO control interest rates or liquidity crunch ? If the customer does not buy, what can the CMO do ? Rhetorical questions ? They are not helpless, but there is a limit to their ability to influence the outcome. They do play a role and they depend on the rest of the CXOs to work lock-step in achieving success. CPO (Chief People Officer) has to help hire and retain the best talent, CIO has to ensure information availability to key stakeholders for decision making and analysis. That’s what the C-suite is all about.

So if the CIO stakes claim to the table, it comes with a set of obligations and responsibilities; it comes with the territory; all CXOs are jointly and individually responsible for the success of the enterprise. It is not about “I have done my part and now you go figure”; I believe that CIOs should and does actively seek this responsibility and then works with others in shaping the future. The C-suite has to take this variability risk. Only then can the CIO aspire to take a position on the Board or become a CEO.

The Power to say No

Over the years for the business dependence on IT has grown to reach a state that it is unimaginable to think of any business running without IT. I am sure that we can start creating a list of exceptions which may be different by geography or economic classification, but predominantly every business operation uses IT to sustain, grow, diversify, improve, analyse, and a lot more.

Over the years the IT Head also transformed through the journey working lock step with the demands of the organization providing the necessary solutions, sometimes wildly successful and challenged, delayed or unsuccessful. Through the era the IT leader kept moving outward from the glasshouse to the factory, warehouse, corporate office, and field and wherever the internal customer was present, and then beyond to where the external customer lived.

Over the years as the transition occurred to the CIO, the discussion changed from the nuts and bolts, three letter acronyms, servers, routers, hardware, software, networking, to business process, order to cash, procure to pay, customer analytics, increasing revenue, strengthening the bottom line, creating competitive differentiation, managing supply chains, collaboration with the suppliers and customers, new business opportunities, until the difference with other CXOs started blurring.

Over the years one characteristic that has not changed is the acceptance of demands = reasonable or otherwise, requirements - rational or not, time pressure to deliver - urgent or not, budget cuts - downturn or not, accepting everything business desired, spoke about, or demanded. The IT function was expected to stay subservient to cajoling, coercion, ransom, threats, with the proverbial sword hanging inches from the neck; if you cannot do it, we will find ways outside to get it done a la shadow IT.

IT was not expected to challenge, they were expected to deliver; whether it is a report that no one sees, a quick fix that stays in UAT for weeks beyond the deadline, systems that saw usage drop faster than the stock market in the downturn, one liners or vague or assumptive requirement definitions, or in recent times consumer devices to be connected to corporate networks. A challenge or denied service was sacrilegious and a pile of turndowns could lead to “lack of alignment” to what business wants.

With increasing comfort with business, conviction, and communication, CIOs have looked the other in the eye and engage in a non-confrontational debate which has germinated into acceptance of the CIO viewpoint and its intent only to the best interest of the enterprise. It’s a newly discovered facet that boosts confidence and fuels itself; the spark is now traveling virulently. CIOs have created the freedom to say “No” to the unreasonable and ill-defined.

When any discussion is based on data, facts, and sound logic, the outcome normally takes predictable route. The acceptance of the CIO into the “Inner Circle” is happening; the retention requires practice of democratic principles. CIOs should exercise this power judiciously and use it to create a better solution or paradigm that encompasses hitherto unused tenets. It takes some wisdom to differentiate between the need and the want and not play favourites; it is always a bad time for dictators who can be overthrown quickly.

Go and exercise this choice, you will be surprised !

How to overcome a recalcitrant staff member or Wally like behavior ?

CIOs often come across situations where they realize that certain individual(s) in their team are unable to deliver even basic results. Typically, such individuals may have survived multiple bosses, or been in the company for a very long time like Wally (from the famous Dilbert series). All efforts to bring about change may have yielded microscopic results. Let me use a couple of examples to illustrate such cases.

You go into a management meeting along with some of your team members; the expectation is to gain consensus on the way forward on a difficult project. All is going well, till silence falls with uncomfortable stares. Or the meeting is halted because one of your team members blundered and lost all gained ground.

Another case is a review meeting with the CEO on what IT is doing. You get started, and then get hit on the head—one of your staff members has not kept promise despite reminders and follow-ups. It was something that you did not focus on, considering the task’s facile nature (which any idiot would find difficult to go wrong on). But then, you are now at the receiving end.

In both cases, you may feel like strangling the person. But, that’s not the corporate way of dealing with frustration!

So the first response seems to indicate that you “fire” the person. That’s an easy solution, but should be the last resort. Instead, here are some other alternatives that you could review:

1. Assign a coach to the person with daily/weekly feedback without holding anything back.
2. Give the truth as it is, along with advice for improvement.
3. It could be professional arrogance (“I am better than others”) that translates into negative attitude. Introduce him to others who are better and show him the reality.
4. Put him on a PIP (Performance Improvement Plan). Make it clear why he is on PIP—that it’s not because of work, but attitude.
5. Assign him away from the “critical” nature of the work, which works at times to demonstrate that he is not irreplaceable. It may moderate his behavior.
6. It could also be a genuine case of incompetence. Try training.

If all these steps don’t work, then the choice is obvious. But that’s also a difficult act to execute!

It’s important to take action sooner than later, as you may risk polluting the contributors and good staff. Delay will encourage the person to continue his (mis)contributions to the department. I have observed procrastination becoming the nemesis of many CIOs, so all I can say is, ACT NOW !