Monday, February 22, 2010

Are Boards ready for the CIO ?

Every now and then, we come across the question, “Is the CIO ready for the Board? Can they do justice to a position on the Corporate Board?” This issue has been debated ad infinitum, as some CIOs have already made it to the boardroom — even as others continue to passionately drive the IT agenda within their enterprises. Although certain CIOs are yet to evolve to a level where they equal other CXOs within their companies, the majority of CIOs have already reached a level of maturity to directly or indirectly advise their management on strategic and operational issues that have a strong dependency on the IT systems that enable their company.

While addressing a group of CEOs in an event recently, Ram Charan, the renowned management guru discussed the purpose, functioning and effectiveness of Boards. According to him, the following characteristics differentiate good Boards:

1. Boards should be competitive.
2. They should review the external environment, and not remain inward focused.
3. Board members should know other CXOs within the company, as they drive the company agenda and deliver the company’s vision to the stakeholders.
4. Global Boards have to balance growth and resources equally well. Resource allocation is a key to Board management.
5. Boards should continuously review internal and external relationship building by CXOs, and ensure that the CEO also creates a pipeline of leaders.
6. Boards should have a very clear 12 month agenda, apart from a strategic roadmap.

Now let’s look at the typical CIO and the role that he plays in the company. He provides the information infrastructure that enables his business to interact and transact with customers, suppliers as well as within the enterprise. He also analyzes, presents, protects and disseminates information assets across the ecosystem. A day without IT is unimaginable across most business units (as well as industries).

The CIO is not just the information infrastructure’s custodian or provider. Today the CIO challenges business processes, influences outcomes, and works with all stakeholders across the enterprise to automate, rationalize, and optimize. The CIO’s view of the company has better breadth and depth than that of other CXOs. Their interactions and ability to switch from Marketing to Finance to Supply Chain with ease during different meetings demonstrates their comfort levels with multiple domains. This led to an observation by a leading thinker, “IT is too important to the organization to be left to the IT staff”.

Last week, I had interactions with two mid-market CEOs. A generation gap separated them in terms of age, experience as well as mindset. The younger CEO challenged the CIO and encouraged him to challenge other CXOs within his enterprise. This initiative helped in the CIO’s integration into the management team, as well as a position on the board of directors. His words were bitter-sweet music to the ears of the CIOs he addressed. Some CIOs wistfully wished that their respective CEOs quickly reach this level of understanding. The younger CEO’s enterprise used IT and information better than peer organizations — an impact demonstrated by the company’s financial metrics.

The older and much respected CEO (also on many boards, as well as the founder of an IT company) admitted that his CIO did not have a position on the management table, forget the Board! He put the onus of this challenge on the CIO, and did not believe that he was required to provide any impetus towards the CIO’s career progression. As this Q&A with the CIO gathering progressed, it became evident that the difference in mindsets (and thereby the organizational culture), would have made it challenging for any CIO to migrate to the management team. His contention was that Boards discuss people and money issues, but not IT issues. He felt that this was the result of how his CIO has not created visibility with the Board. He found it difficult to accept that most Board members appreciate the need to be aware of how technology impacts their enterprise or can provide unique competitive advantages.

Considering that experience and wisdom (that comes with age) plays a significant role in the Boardroom’s composition, a majority of directors or independent directors belong to the latter classification. Until Boards transform themselves and induct fresh young leaders who are comfortable with technology, use it daily for normal tasks, and worry when they hear about competitors implementing new technological innovations, it will remain an uphill task for the CIO to find a chair in that room.

Monday, February 15, 2010

The evolving IT service provider

IT service providers are evolving, and at quite a rapid pace. To take a case in point, I was invited to a gathering of more than 100 IT service providers and channel partners to talk to them about “How to sell to a CIO”. This is not the first time that I have spoken on this subject; earlier, it was to sales teams of large Indian and global IT companies, but it was different this time. The group comprised of mid and large sized companies who vie for business from the small and medium enterprise (SME), as well as large enterprises. This segment has to balance between different types of businesses — right from owner driven organizations with no formal IT organization as such, all the way to CIOs of large companies. And a lot of such service providers classify the SME business in terms of people, revenue and process.

It was interesting to observe that the audience comprising largely of CEOs and heads of sales (or service), listened with rapt attention. It was eerie in a way — there was absolutely no cross-talk, buzzing of mobile phones, or anyone getting up during the hour long talk (I am used to, and also guilty of, such behavior during conferences). The audience could associate with most references to vendor behavior — their wins and losses, joys and frustrations, ups and downs. It was as if their lives were being subject to scrutiny, at a scale never done before.

On the flip side, the participants had many questions on why CIOs ignore them, and at the same time want the CEOs to visit even for a small transaction. According to many, the CIO egos were a big put off. There were also many questions around the lack of transparency in decision making, the inordinate negotiation timeframes, and then expectations of how the services, goods or solutions should be delivered in super crunch time.

As I made an attempt to answer some of these concerns, it was evident that the CIO’s evolution is still an ongoing process. Not every CIO has evolved to a level of maturity where almost every business transaction is a win-win situation (or every interaction is looked forward to). There are no universal answers that can be applied to every situation, since the CEOs agreed that there is a serious need to impart skills within their teams in order to more easily manage the situation.

Governance applied to IT procurement was another heatedly debated aspect. While vendors like to work with the CIO towards long-term relationships, being the lowest price vendor is not the best criteria for selection in such a scenario. According to the vendors, value additions offered as proof of concept, training and education, post implementation handholding, and technology advisory should be given due weight while taking a decision on awarding the business. The channel partners also expect clear decision making cycles, so that they do not end up in the hands of “purchase departments” who measure only on the basis of savings over the initial offer or budget.

The relationship between IT service providers, channel partners, and the CIO is at best, symbiotic. We need each other to be successful, in our quest for achieving our objectives. A partnership built on shaky ground will not withstand the travails of time and pressure from internal as well as external forces. Trust has to be built upfront and sustained, for each others’ success. To quote my favorite management thinker (at least in 2010), “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself” – Peter Drucker.

As the IT service providers and channel partners evolve to understand their customers, the industry in which they work, the opportunities open to their customers, and work towards creating success for the CIO, it will be a challenge for some CIOs to now engage with them at a new plane of maturity and understanding. It the CIOs fail to achieve this, they may alienate themselves into a situation that will make success difficult.

Are CIOs up to the challenge? It still remains to be seen.

Tuesday, February 09, 2010

Irrelevance of vendor presentations

Let me start with a quote from Peter Drucker — “There is nothing so useless as doing efficiently that which should not be done at all.”

Last month, I was invited to a a marquee publication house’s three day offsite CIO event to discuss the coming year’s IT agenda. Topics on the agenda looked good, the attendee list was glowing, and a long standing relationship with the Editor propelled me towards attending this event. So I packed my bags and decided to give it a shot.

Almost all such events invite a couple of CEOs and thought leaders to share their insights and provoke some thought within the audience. And the CEOs did not let down on that promise. They had the audience eating out of their hands, listening with rapt attention to every word, absorbing it, taking notes, discussing with their neighbors, and in the end asking a lot of relevant questions. The act was a tough one to follow, but the CIOs were charged.

As a result, they (the CIOs) did not mind a few vendor presentations. To their credit, the CIOs did attempt to follow these sessions, but it was a difficult proposition to keep the lids from drooping.

The following days had everyone unanimously wondering what hit them. The torture began with inane presentations ranging from the usual suspects — virtualization, green data centers, cloud computing, outsourcing, intelligent cabling systems, network rationalization, and so on. A few consultants tried to revive the audience by raising questions about CIO reporting and their efficacy. The audience was too numbed to be provoked, and let it go with a mild reprimand similar to “Don’t disturb my sleep”.

The icing on the cake was a presentation on “What is a Data Center”. Yes, men are from Mars, and in a predominantly male crowd, by association CIOs could be classified to belong to Mars. But telling a CIO about what a data center is like is rather akin to teaching Michael Schumacher how to ride a car! I wanted to insert an analogy on Golf, but decided against it.

Without exception, every sponsor had a slide deck (with a minimum of 30 slides) to be displayed to the captives. They ranged right from very basic elementary stuff and all the way to one which wanted CIOs to learn how to move virtual partitions across servers. To be subject to such a score of presentations over two days beats the torture that even the famed Nazi inflicted on their poor captives.

Despite being advised against it by the organizers and post event feedback by the audience, it beats me as to why vendors insist on subjecting CIOs to repetitive presentations with nothing new to talk about, and preach their version of religion. To top it all, these activities are dished out by sales and marketing folks, who are not even subject matter experts (these people could potentially be challenged by the listeners).

The last straw (in a few cases) is the substitute junior staff member reading out slides with no eye contact with the audience. Such a person is typically in a hurry to get off the stage in order to avoid any cross-questioning from the few members who suffer from insomnia. I would rather withdraw the slot than be the subject of “How to reduce your exposure to this vendor”.

Has the IT vendor become a slave to these habits? Has their thinking has become clouded (a side effect of cloud computing?)? Is the scene so bad that IT vendors are unable to explore alternatives to engage their prime customers — the CIOs? Whatever happened to good old case studies, panel discussions, and interactive sessions in the form of a Q&A? Are vendors unable to stand tall without the crutches of slide decks which no one wants to see? Why do vendors continue to alienate themselves from their customers?

I guess it’s time to get back to basics. To quote Peter Drucker once again, “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” Will a publishing house donate some Peter Drucker books to all the Marketing Heads of IT companies?

Monday, February 01, 2010

CIO Publications have yet to evolve !

On an average, I receive more than 100 email newsletters every week from various publications and sites that focus on CIO agenda and leadership. These newsletters are expected to help me keep abreast with what’s happening around the world in the domain that I made my career with, which is Information Technology — now almost always referred to as IT. My mailbox has been full of such messages for as long as I can remember, maybe a decade or so now.

A decade back, the IT leader — now referred to as the CIO — focused a lot on applications, infrastructure, new technology innovations, and business process improvements. In a few cases, the CIO also participated in discussions that were indeed strategic in nature. Contributions to ideas and products were happening even then, as they are the norm today. Ten years back, emails were not as many as they are today, pure-play content sites were few, and not too many sent daily updates. The focus was typically on the nuts and bolts that make up IT infrastructure, the wrapping around it, the database, middleware, presentation layers, and packaged applications which were replacing legacy custom coded programs.

The CIO’s role started transforming in the early part of this millennium. This was driven with the expectation that if a CIO has to retain his right at the table, he has to become more business savvy and leave technology to partners and outsourced teams, as these skills became commodity. IT teams reorganized themselves around business functions and avidly pursued learning of, and about the business and processes. The focus was on how IT teams could contribute towards achievement of common corporate goals and objectives. Vendors and consultants changed their pitch to the CIOs talking about business issues, measuring the efficacy of the CIO’s business knowledge, and how they applied this towards solving real business problems.

Thus CIOs started to attend executive development programs, speak about business technology, scavenge management books, and debate with management thinkers. It was suddenly about how to challenge CEOs and other CXOs on how they can contribute to the business. A few expanded their roles into other parts of the business.

All along, CIOs continued to stay in touch with their roots through various newsletters, magazines and online publications. These media channels continued to feed them with latest happenings in technology, vendor landscape and case studies of how someone leveraged technology investments (in a few cases). IT-business alignment was one of the much debated subjects.

But guess what? Media continued to push technology content down the throats of CIOs who were not really interested in that stuff anymore. Yes, awareness of trends, innovation, new gizmos, and collaboration technologies was important, but not to the level of detail that is being published. That is stuff for IT managers, the doers, and the technical teams (outsourced in many cases).

And that confused the CIOs on whether they should retain the level of in depth technology expertise which is being thrown their way. Most weaned themselves off such content, to make the move towards domain, industry and softer issues that a CXO has to manage every day. Content for such learning is rarely available from even marquee publishers — offline or online.

Such disconnect between expectations drives home the point that the evolution of information givers to the CIO is still incomplete. Media has lagged behind the role that they themselves have created for the CIO by egging them away from the technology stuff towards what matters. We are thankful for that, and hope that CIOs will no longer be subject to tips on how to configure a listener for a DB or resolve malformed IP packets or even look at performance management tools for networks!

By attempting to address a range of audience which spans mid-level managers to executive directors and senior vice presidents, the upper segment is being alienated. And if the CIO is indeed the focus, then a major transformational change is required.

The solution to this for the CIO is to diversify their reading habits and include a large portion of business publications to make up for what their daily bread and butter is lacking in.