Posted by: Arun Gupta
BITA, IT budgets, IT Metrics, ROI, role of the CIO
The other day I was in a gathering of CIOs being addressed by an eminent editor who was unraveling research conducted by his IT publication. The research surveyed a large number of CIOs who provided their priorities, challenges, opportunities for the year ahead and some numbers (budgets, compensation, and longevity in a role). Based on their frame of reference the audience agreed and disagreed with the data points. This was followed by a discussion on some of the inferences and the qualitative feedback. Then all hell broke loose.
The discussion, like always, touched upon some favorites like business it alignment (BITA), measurement of effectiveness of leaders, and the most debated one, TCO/ROI. Everyone had an opinion on everything and rarely did opinions converge. Some felt that BITA is a non-issue while others still struggle with it; it was opined that the CIO, by virtue of taking on additional business responsibilities and participation in business discussions, has already demonstrated leadership, and TCO/ROI matter to almost everyone except when under the guise of “strategic projects” the issue is sidelined.
The role of the CIO and its evolution from technology to business was justified with the fact that technology evolution and usage patterns within the enterprise have driven newer expectations and thereby the change encountered by the CIO. Alignment need, lack or existence was challenged and treated IT on par with finance and HR or marketing. Contextually, depending on the incumbent CIO and the industry, these are real trends.
Learning from the discussion
Who justifies ROI and who should be tasked with the calculations? Is Post Implementation Review still in vogue? No one had done any and neither did any enterprise go back to review the expectations with the reality. Those who did create business cases with ROI agreed that ROI is now passé. Interestingly a few promulgated that they use the cost of not doing a project and losing on growth, customers or position in the industry. The learning from the discussion could be summed up as follows:
1. BITA is largely dead; it is not about alignment anymore but about working together and solving real business problems. Gap, if any, is the perception that vendors and consultants want to fuel.
2. In the same spirit, ROI or any financial metrics is co-created by the CIO along with the function or business impacted. The justifications focus on incremental revenue or cost savings and are shared between the CIO and the business head.
3. Projects are also being sanctioned with strategic intent focusing on not just the new capability and its impact, but also on the potential disadvantage faced when the capability is missing.
4. The discussion around the table is no longer on the technology, but the impact and outcomes which have to be enumerated using the positive or adverse impact to customers and employees.
5. There will be enterprises that get it and some who don’t. CIOs will jump ship where they remain challenged for too long.
I wonder what is the need to continue berating the role in which we are, the CIO? Can we stop talking about it and get on with IT? Are we creating self-fulfilling prophecies propounding the need for alignment, or the evolution of the CIO role, or at the basic level pondering on how to justify budgets?