What do you do when post negotiation the offer is declined ?

Business teams wanted the solution badly as it gave them a capability that none of the competitors had. So they worked with the CIO to conduct a thorough analysis of the options available along with validation from an independent IT consultant who had no bias towards any solution provider. The final conclusion was no different from what the business had intuitively arrived at on their own. The excitement was palpable and everyone waited for the budgets to be defined and approved to get started with what would be a project of a lifetime.

The business head along worked along with the CIO to prepare a business case for implementation that was put forward for review by the Executive Management. Discussions turned into debate and ended with clarifications sought from the team on choice of technology and associated investment. Patiently the CIO, vendor, and the business head addressed all open issues to be given an approval of a much reduced budget to get started with. It was a stretch and a difficult ask; everyone knew that but decided to give it a shot.

The negotiation started in earnest with local vendor team who threw up their hands escalating to the regional office; the regional limit did not allow for the expectation from the customer. The local team did not give up as it was a high profile customer and the CIO had brought significant transformation; they knew if they won the business it would be a high visibility win. The defined scope was large and by virtue of this the order value even at a high discount would be worth the effort. So the negotiation was pushed to the global headquarters to manage.

Head of Global Sales arrived at the customer office to close the deal. He was hopeful that he should be able to close in a couple of days. Back and forth it went tugging from one end to the other each waiting for the other to bend, none willing to yield ground. He realized that the customer knew their position and were willing to wait it out to get what they wanted. In a typical world it was a huge discount which they had not done for a long time now. The war of wills had the business head pushing for closure citing business value loss with the delay.

With the Purchase head reporting to the CFO who was unwilling to come down from his high stance it appeared that there was no way out. The CIO was cognizant of the fact that there was business value to be captured which was well articulated and presented by the business head. He called the vendor CEO giving them an opening to break the deadlock and suggested the same to the CFO. The customer and vendor accepted the solution and everyone sighed with relief and shook hands bringing to an end the long drawn battle.

Everyone shook hands and the approval process was to complete in the next few weeks to get the Purchase Order released. Timelines were agreed to on the start of the project, resources were to be allotted from the global talent pool. Life unfortunately does not always play fair. With a twist in the story, in the elapsed time dynamics had changed; the Company had just finished the annual budgeting cycle and the project was about to spill over to the next year. The Executive Committee suggested a review of pending projects.

Left hand unaware of what right hand was doing ? Or did the project become a victim of circumstances ? Was it communication gap between the Executive Committee and the stakeholders ? The Business head was present in the meetings that discussed the company’s results and priorities. Or was it just a case of lackadaisical attitude from the Finance and Purchase team that left the Vendor, Business and IT high and dry ? Can Internal politics drive the investment agenda ? So what caused the project to be abandoned after the long drawn negotiation ?

The vendor did not know how to react to the situation which had taken huge time, effort and resources that now came to a naught. They received curt messages from the Company on the deferment; the vendor CEO reached out to his ally the business head and the CIO. Reality was indeed perplexing and to some extent juvenile with one person’s ego becoming larger than life. Vendors abandoned their quest for business from the company rather than be subject to similar treatment arbitrarily that lacked basic professionalism.

The company is slowly rolling back into the past !

That rogue app

We need IT support and expertise to scale up the application; there are a few enhancements and some bugs that need to be fixed. For us it has worked well for the last year and we believe that it can deliver similar benefits to other parts of the company. You know the efficiency it has given us has helped meet our targets and we now measure favorably on most KPIs. Can you organize for the resources at the earliest ? Thus started a discovery of an application that had gone business critical !

The company had engaged a big name consulting firm to help in a business transformation. The project had been announced with big fanfare and branding that had everyone excited with the potential outcomes. The initiative took off quickly with key process identification and definition of measurement criteria. Review meetings began with the realization to promise while dashboards sprung up all over the place. These charged up everyone and the movement spread quickly.

Everyone applauded the effort which was cascaded to a few sites with the same level of success thereby ensuring that the model was robust and scalable. The consultants had created a working spreadsheet model that automated the critical process chain and helped improve the decision making. It worked well for the select set of users who proudly displayed the results to anyone and everyone who wanted to know more about their success. People moved on to other things and soon this was forgotten.

The CIO had no inkling of the spreadsheet becoming mission critical to the unit and the slow virulent spread of the solution. It did not cross the business teams’ mind to move on to an integrated and scalable formal application that would integrate with the data sources rather than continue taking data dump and manipulating to get to where they wanted. No one challenged the process as it slowly crept on until the data size became unwieldy and a few locations wanted to tweak the model.

That is when the CIO was approached to rescue the situation. They wanted a technical resource to help fix and deploy the solution. It was a precarious situation for the CIO whether to push back or fall in line and support the business critical application. There was pressure from the stakeholders and some CXOs to support the solution. The easy way out was to let go; after all, the project did have visibility and everyone knew about it, so why make an issue. But that would have set a precedent !

My friend was not known to be politically correct and ready to take a stand on principles; for him that was the only way to do things. And that’s what he did; he asked the team to submit the documentation of the system based on which the team would determine whether the program could be supported or redevelopment was the way out. He went on to deplore the situation with the CXO responsible and instructed his team to follow his diktat. Reconciliatory moves to find a compromise were brushed aside brusquely.

This was not a typical case of rogue or shadow IT that ignored the IT function or the CIO intentionally. It was never expected to become a business critical solution to be deployed across locations. Every function uses spreadsheet to address simple data capture, analysis or sometimes address tasks that conventional solutions are unable to fulfill. Quick and dirty spreadsheet or other out-of-the-box solutions are typical to any company today. They crystallize the need which IT is able to qualify and address.

I do not believe that there is a singular way to address this situation. All approaches are correct in the context of the situation and the reality of the involved stakeholders. It is important to address this tactfully without burning bridges. My friend knew the boundaries in which he could push back and where he needed to take a step back. Post acknowledgement of the issue, he asked the team to support the scale-up of the application in an integrated framework that had everyone move ahead.

What would you do in such a situation ?

CIO Trilogy: last brick in the wall

Recently, a respected publication’s edit piece on CIOs highlighted the enterprise’s changing expectations from a CIO. This insight was gleaned from “CIO wanted” advertisements as well as discussions with headhunters or executive search companies. Some of these headlines were on the lines of “CIO with ABC ERP implementation experience”, “Full lifecycle ERP experience is a must”, “Should have worked in discrete manufacturing”, and “Strategic CIO with operational experience reporting to CFO…”. The last one especially is a paradox!

After an oscillating experience between East Asian and Indian leaders on their perceptions of the CIO this month, changing expectations from the enterprise brings up an important question, “Is the CIO role changing subtly by taking a direction divergent from where current and future CIOs want to be?” Yet another passionate discussion revolved around enterprises hiring CIOs from outside the IT functions. This trend may be positive or negative based on your frame of reference.

Enterprises have faced challenges in the execution of large cross-functional (or high-end technology) projects. Many of these adversely impacted operations or delivered limited value commensurate to the effort. Some were possibly due to oversell by the IT organization which led to inflated expectations from these investments. However, a large number of these projects have observed no correlation to technology (as has been consistently reported by the Standish Group in their tracking of IT project success over a decade). Instead of technology, management involvement has remained the primary influencing factor in these projects. Even if it seems irrelevant at this point, the final buck for effective technology adoption stops with the CIO. Thus, this has given rise to the hypotheses that “forget the strategic part of IT, let’s get someone who can fix the operational pieces first”.

Outsourcing of the support services, changes in educational structure, and consumerization of IT has demystified the technology black box. The new workforce has grown up with technology. As a result, they are unafraid of exploring new frontiers that current set of leaders and managers in their 40s and 50s may not always be keen upon. With the continuous thrust on Business IT alignment (BITA) and many commentaries on “IT is too important for the enterprise to leave it to techies”, the new business leader is emerging from non-IT domains. More importantly, he is reasonably equipped to get started on the journey towards becoming a CIO.

The current generation of technology professionals (either CIOs or those moving towards the role) must pay heed to this new trend. As is evident, the minimal expectation is to ensure operational efficiency from all projects and meeting of baseline business expectations. Industry knowledge now supersedes technology expertise for the leader, but well rounded experience matters at the next level.

After all, if the enterprise continues to remain challenged on effective usage of technology for any reason, even if not attributable to the CIO, the role will be downgraded to the position of an operational IT manager reporting into the CFO.

IT failures ? Business' challenges

I recently read about the global annual cost of IT failures wherein the author based on certain assumptions puts the figure at US$ 6.2 trillion. It’s almost half of the US GDP number and that is indeed something to think about. Never mind the assumptions or the math behind the figures, the reality is that this humungous number is being labeled as IT failure. The Standish Group report on reasons behind the lack of success in projects with significant IT components indicates that IT contribution to unsuccessful projects is less than 10%. So in reality the number would be closer to US$ 620 billion. And that is about half the GDP of India !

Knowing a bit about IT, I would label this as a business failure to capitalize on the potential that IT could have offered to them. Why does every initiative have to result in painful change management that the IT organization has to drive ? What prevents the business users from embracing new technology solutions despite their vocalization of the requirements in some form or other ? Lots of questions, are there any answers that provide the holy grail to impact the crazy figures out there ?

My Oh I See moment happened many years back when my obstinacy to not start a project without a signature from the business leader delayed the project commencement by 11 months. And when we did complete the project within the stipulated time of 6 months, it was like water to the desert weary traveler who has even stopped believing in mirages. So don’t push hard to implement the next SCM, CRM, or whatever TLA (Three Letter Acronym) technology you believe will make the difference, because it will not if no one uses it.