Monday, October 31, 2011

Resetting Expectations

I met a CIO who was wondering what’s going wrong after having spent many successful years in his current position, working with the management team, implementing various award winning solutions, helping the IT team come out of the technology mindset to thinking business, and last but not the least making IT a business partner. He sought to unravel the mystery and find clues on what could be done to overcome the situation.

As the drinks continued to flow, I quizzed him on if he had made any behavioral changes ? Negative, he replied; everything was going smooth until recently and he had not made any changes to his modus operandi. So I dug deeper; where there any changes in the business scenario, industry, market position, anything that could have triggered the change ? He stayed silent for a while and then mentioned yes, the company had appointed a new CEO and thereby he had a new boss.

Every organization is dynamic and so is the team that makes the enterprise. Attrition is accepted as normal which brings fresh talent and leadership; in most cases new ideas and styles of management bring forward the strategic agenda of the company. When the new inductee is the CEO, there are always a lot of expectations by the stakeholders. The internal team(s) specifically the management team downwards has to make adjustments to new style, expectations and way forward. Few in discord decide to move on to greener pastures elsewhere.

However, there have been some exceptions where the company under new leadership has suddenly finds the management team not agreeing to the new direction. Most give the new agenda a try and work towards alignment. It is also possible that the CXOs may decide to move on citing working or cultural differences with the new leader. Rare instances also exist where the company floundered until the Board of Directors made corrections (we recently saw that for a large IT company).

As these thoughts ran through my mind, I realized that my friends’ company had seen good results in the last few quarters, which would imply that the new CEO was continuing the growth agenda. So I prodded the issue further; had his relationship with his peers changed since the new CEO took over reins ? Not really he quipped, they continued to work with him like before; his new boss seemed to have some strong relationships with some of his peers and transactional with others.

Opening up, he stated that he was being challenged on some of his decisions more rigorously than before; had to present a lot more justifications on any project, and was asked to review the IT strategy and its applicability going forward. The strategy was discussed and approved only a year back, so why the review again ? The CIO wanted to start polishing his resume again.

So I had to hit him hard with reality. If the new manager wanted additional details on initiatives, it would indicate that he wanted to update himself and validate assumptions. If he has to justify every project, why is he worried if due diligence has been done fairly and equitably with business participation. Every strategy including business strategy requires periodic review, so where was the problem ?

I believe that a dialogue is the means to build the relationship rather than see it as threatening credibility. No two people think alike; so to assume that past way of working will continue to yield dividends is foolhardy. It does not matter where you are in the corporate hierarchy, change is inevitable, and we have to learn to live in the rain.

Tuesday, October 25, 2011

(Why) Should CIOs be interested in LAN cabling or UPS batteries

I attended a CIO gathering which had an UPS battery manufacturer as one of the key sponsors. The presentation discussed the merits of one battery technology over the other; they offered a promise of higher reliability that matters to any CIO. So I started asking the half a dozen CIOs on my table if they knew which batteries their UPS in the data center or office premises used. Only one knew the answer.

A few days back a senior editor of a respected publication that also conducts small gatherings of CIOs asked me if I would be interested in attending a dinner sponsored by a structured cable vendor. He spoke in jest and wondered if he would be able to gather an audience numbering double digits. I kind of concurred with him as cabling was the last thing on my mind. I don’t remember when was the last time I reviewed cabling standards or attended a meeting with a cabling vendor.

I must have written many times on the new age CIO and the transformation over the last decade. I think that petabytes of information exists on this subject which any search engine will throw up. No event is complete without a discussion on what are or should be the CIO role or priorities. Everyone agrees that the IT leader is a business leader first and technology expert later. As a leader, s/he is expected to demonstrate behaviors no different from the CEO, CFO or any other CXO.

The CIO through his/her team gathers expertise on various technologies and related domains. These teams typically along with principal vendors, external service providers, and system integrators form an ecosystem that provides the basic and advanced solutions that enable and empower any enterprise. In every enterprise the deputies who form the IT Management and Operations team ensure that every day billing happens, manufacturing plants hum, goods leave the warehouse, call centers receive customers, sales people sell, finance teams collate figures, external partners get information due; in a nutshell, the world continues to move on despite random failures that occur at all levels.

In today’s world where most technology components (be it hardware, software, or connectivity) find it difficult to differentiate approaching commoditization, choices are influenced by existing long-term relationships between enterprises or people, or a significant price difference. Quality of Service is the only other determinant factor. New disruptive paradigms in the last few decades have kept every CIO on his/her toes to keep the enterprise competitive and current. But then there are some who haven’t.

So coming back to our battery vendor and the cable manufacturer, are these critical and high on the list of priorities of the CIO to demand his/her attention ? Should s/he undertake strategic meetings with the Management or Board on kind of cabling is being laid or the merits of one battery technology over the other ? What would happen if the battery bank failed and servers went down or storage disconnected due to a loose patch cord ?

I believe that the IT Infrastructure Head and his/her team under the CIO are tasked and are or should be empowered to deal with this. The ball however always stops with the CIO being answerable. But then every CXO depends on their teams to deliver and does not necessarily get down to micro-management. On an analogous note, is the CMO in trouble if lights on an outdoor hoarding go off ?

Monday, October 17, 2011

Judging CIOs and being judged by them

As a recipient of the award myself a few years back, I had the privilege of being invited as a jury member for the Global CIO awards organized by a global industry publication. It was a big responsibility to shoulder when almost all the nominated CIOs were friends who shared a drink or a joke in the past. I felt unsettled about it wondering about the impact it may create on the relationships shared. At the same time I was excited about it with the honor being conferred to be considered for this big task.

This was not the first time I have been on any jury; there have been many instances where along with industry veterans, global luminaries and celebrities, and academia I contributed to the selection of award winners. In most cases the nominees were upcoming leaders; in a few cases where the subject was the CIO or a CEO, other jury members by virtue of their seniority carried the process well without pressuring the junior members. Many of these awards recognized companies and not individuals thus making it easy. This was the first time that I had this wonderful opportunity and I was nervous.

The process was fairly well laid out with well-structured data and defined evaluation criteria. Each jury member selected from different backgrounds and was provided the same information to analyze and independently create the list of winners. The common list with validations would be then declared as the final winners. So far so good !

Listening dispassionately to each pitch without clouding influence from past interactions is difficult. Spread over a fortnight the discussions left me richer with new insights that I could imbibe, a benefit rarely possible with otherwise guarded conversations on challenges and tactics used to overcome them. My respect multiplied for most of the contestants with the learning gained; my achievements suddenly looked insignificant in comparison. On the designated evening as they collected the awards, the new bond shared with the winners created warmth to be cherished for a long time.

Recently, I too was subjected to peer judgment in another open list being compiled by an industry association which sought to recognize “Most Respected CIOs” in India. Self-nominations were not allowed and neither was CIOs reporting into the individual in case of group responsibilities; it was a selection by peer CIOs who were asked to nominate others. With open ended questions and selection based purely on votes, the contest was wide open to anyone.

I believe that peer recognition especially from high performers is difficult to achieve when the starting benchmark is own performance for the person judging. People observe behaviors and form opinions that are difficult to change. The foremost element that matters is Trust which in turn over a period of time builds Respect. It does not happen overnight but can be lost in a moment. It was gratifying to be voted to the list and staying there as the voting progressed.

Investments in sharing, learning, coaching, and mentoring pay rich long-term dividends; it is important to give as much as it is to receive.

Tuesday, October 11, 2011

Metrics that matter

I bumped into an angel investor in a social gathering organized by a company funded by him. Discussing a range of subjects, he was interested in understanding how customers of his funded company used technology and traction with the Management across different sectors. Acknowledging the fact that all his invested companies used IT as a competitive differentiator, he queried the metrics used by CIOs in India. In the discussion group were CIOs from Banking, Insurance, Manufacturing and Retail.

Starting with IT budgets, the range observed was 1.5% upwards all the way to over 10% for a Bank. I am referring to percentage of revenue, one of the metrics everyone uses and is portrayed as a reflection of the seriousness of IT investments globally. Angelically he disagreed with this norm as Capital and Operating budgets should not be clubbed into one IT budget. Echoing the thought a few CIOs stated that they separated the capital investments moving them to the business units since new initiatives have to be what business needs and wants.

Investors have a way of getting their viewpoints; he asked if separating the capital investment and operating expenses helped. The answer to that was a vehement yes. The CIO actively controls how the existing IT setup is managed and thereby can optimize capacity and support. Investments are always linked to new business initiatives and outcomes. A great system or the best technology does not create a recipe for success if business fails to utilize it effectively. When the investment impacts P&L of the business, the ownership and contribution equals the effort put in by the business and IT.

The discussion veered to CIO dashboards and what were CIOs monitoring daily, weekly or monthly. The responses varied from health of systems to active budget tracking and key projects that IT was involved in. Only two mentioned that there dashboard was no different from the other CXO dashboards but included a few IT metrics too. Considering that the CIO is in most cases an equal partner in the business, why should the dashboard be different ?

Active projects with large investments require monitoring and communication to provide visibility across the enterprise. Success is measured not just by on budget or timeline, but effective use and business value that may have been spelt prior to the project. Like the CMO would monitor marketing campaign effectiveness or the CFO tracks treasury, the CIO has his/her business IT projects.

Lastly the IT Strategy and long-term plan tracking is the most critical one. As the owner, the CIO must track and report periodically progress made, issues and challenges, new opportunities and finally business impact delivered. It is a living plan and not something to be created, approved and locked up. What gets measured normally gets done.

The investor benevolently nodded to the maturity of the CIOs and their success in managing perceptions and that they get it.

Monday, October 03, 2011

Engaging the Board (of Directors)

If you want to get a seat on the Board of Directors, then you have to think like them; understand what drives them and how they take decisions. BoD is not interested in the micro details of various initiatives or specifics of the technology solution. The discussion is about how IT furthers the strategic direction and helps the company achieve its long-term goals and objectives. Does it improve revenue or bottom line such that it creates shareholder value ?

So went the discussion to which I had the privilege of being invited that was debating the need, process, and models to engage the Board of Directors by the CIO. The panellists comprised a consultant, a CEO, and a couple of CIOs. The audience of CIOs were keen to learn from the experience of the panel, tips, insights, any pearls of wisdom that would help them forge ahead. So what does the CIO need to do to get the attention or when s/he needs to present a new initiative, how to make a case compelling enough to attain approval quickly ? Do BoD really get into the detail ?

Over the last decade or so I have observed that they do balance the strategic and the operational. Depending on the context, they have a tendency to drill down all the way to the transaction or root cause; the next discussion could be about the next 5 year growth or an acquisition. The latitude of debate varies; the composition of most Boards is normally diverse with complementary skills to cater to such swings. So is there a checklist that helps in getting an audience to begin with and then a permanent invite ? Is there a timeline that can be cast ?

Few insights that did come across were that in new age high technology companies the CIO is indeed included by design. Younger CEOs are more likely to invite the CIO to the table considering their familiarity and usage of technology. Conventional and old age industries with a legacy or history are less likely (there are exceptions though). Despite constraints that may be cultural, evolutionary, or due to lineage, there are steps the CIO can take which are listed with some input of my own.
  • If you report to the CEO and s/he is not tech challenged, then take his/her help to get exposure with the Board
  • Engage with other CXOs who are already working with the BoD
  • Cultivate relationships with one or more Board members who are sympathetic to IT
  • Create an IT Annual Report that is also circulated to the Board
  • And the obvious one, talk about business and not technology even if you are the CIO of an IT company
 Despite this it is likely that your Board may be bored or uninterested in what IT is doing or how you the CIO plans to transform the business. You are walking the talk, you could keep pushing hoping that the message will get through or you convince your CEO make the pitch. But if none of this is happening, start looking where the grass is greener or be satisfied with what you have, you can always make lemonade out of it.