Over the years CIOs and vendors have worked to forge relationships that go beyond transactional and contractual obligations. This decade-long trend has strengthened some bonds in such a way that irrespective of the companies that the CIO or the vendor representative worked for, they continued to do business over the years. I have heard the adage many times, people do business with people.
CIOs in new assignments replace vendors with their preferred partners from the past based on comfort and the proposition that they know the people within the company; they are comfortable with the management hierarchy and the finer nuances of the organization’s way of working. However, such changes are occasionally disruptive to the enterprise as well as the incumbent vendors who may have enjoyed good relationships and business with the earlier CIO.
A lesson in humility
An interesting situation happened when the sales head of a large hardware vendor moved to the larger competitor; the customer used the solution of the earlier vendor and the CIO was planning an upgrade or replacement. The sales head had to come back to the CIO to work in her new avatar to sell the competing solution. Earlier as a customer of the smaller company, she had advised him of the demerits of moving to the industry leader’s solution. The predicament switched over a weekend close to signing the deal created some amusing but discomforting moments for both the CIO and the vendor.
While they enjoyed a great relationship, the CIO demonstrated maturity with fair evaluation and technology taking precedence in the decision making criteria. In the end, the CIO did buy the competing product but with a clear message that the decision was fait accompli before the movement of the sales head. It was a lesson in humility for her being a large order from a marquee customer for which she could claim no credit.
In another case I found that business to business connect was stronger, surviving the changes in relationship managers over the years. The foundation was built on long standing relationship though the delivery was of acceptable quality. This relationship sustained itself with the sales team only facilitating renewal of contract and extension of service.
Why do some relationships survive beyond people or organizations? What makes some shift while others stick to the tried and tested? Does one have merits over the other? What happens when the sales team starts taking the business for granted? How does the CIO break the chains of inertia or comfort keeping the business interests over individual comfort?
I believe that relationships are fragile; they sustain themselves in a symbiotic way when the end result is win-win. When the CIO is in a position of compromise, survival instincts will drive the path ahead. This may result in breakdown of existing relationships. Vendors need to keep a watch in such signs before they reach a break-point; go beyond transactions to engagement. The CIO on his/ her part should constantly engage in an open dialogue with service partners to provide feedback and discuss challenges and opportunities. It is almost like managing internal teams.
Status quo is not an option.
Everyone agrees that business priorities define the IT agenda for any enterprise; the starting point is the organization business strategy, in the creation of which the CIO participates and then gets down to formulating the IT strategy that is aligned to the business objectives. It is also well understood that there are no IT projects but only business projects enabled by IT. There is no disagreement to the fact that if there is business ownership and buy-in, initiatives have better success rates when compared to projects owned and led by IT. Companies working in this framework claim higher business IT alignment or BITA.
In the current context with disruptions and changing business paradigms driven by technology, social media, mobility, every day brings new challenges and opportunities for every CXO. All of these link back to IT in some way and the responsibility rests on the CIO to help unravel the quagmire. Referentially there are many instances of wins though they do not provide the same results when replicated by others. So where is the gap?
A recent survey on the balanced scorecard of the enterprise cascaded to CXOs revealed that in mature organizations it was difficult to differentiate between the CMO, CFO and the CIO scorecard. They appeared to mirror each other with the collective agenda being customer acquisition and retention, growth, and profitability. There was appreciation of core competency but there were no silos. Everyone had to work together to create success.
What’s the right recipe for success?
Then is the hypothesis on alignment above still relevant? Why some of the innovation does not work with copy and paste? What makes some organizations successful and some challenged? In the past some of the scenarios were termed cultural or political and brushed aside; sustained success is a function of how the management team works together to support each other. When any of the functions is perceived to be first amongst equals or of lesser pedigree, then the effort required for success multiplies.
CIOs leading from the front can drive new business opportunities and models. In the case of FMCG industry, the solutions transformed the way orders were logged into the system from the field; the pharmaceutical industry gained prescriptions using planning, targeting, and reporting by the medical representatives on the field; retail and airlines improved customer service with queue busting. These are just a few examples of innovation driven by IT. I do not in any way take away the credit from others–without their collaboration this would not have worked.
I believe that the era of alignment is passé; many CIOs have already moved beyond focusing on alignment to creating new business opportunities. It is not about how IT can solve a problem but about the next leadership step driven by IT and business adapting to the new paradigm. Business no longer drives IT alone; IT has broken free of the age old postulate and is now also leading business direction. BITA and ITBA are two sides of the same coin. It does not matter which side you look at, the value remains the same.
Exchanging notes with some old friends, reminiscences of long drawn ERP or similar projects and some quick wins took us on a rollercoaster ride. Everyone had been through a couple of implementations that stretched patience and planned deployment timelines that now seem unreasonable. In those days a five-year multi-geography deployment was acceptable; after all, the first implementation had to stabilize and learning imbibed before taking the next steps. Baby steps before running, you know!
The long and the short of IT
I remember my first ERP implementation almost two decades back that lasted almost a year; that company was the size of today’s small-medium enterprise. But in those days, business agility was measured in years and not in quarters or months, or for that matter, weeks. A decade later I was involved in a global deployment of a large back office system; we were at the tail of the global project spread over five years. Since the business impact was considered nominal, no one saw any issues with the five-year cycle.
A debate then ensued attempting to answer the question that in the current uncertain world how long is long indeed and untenable? In the age of SCRUM and hyper time sensitivity towards every change in business process or new business idea, what is an acceptable implementation plan for a project that spans multiple countries? How long should it take to replace an ERP system or a financial accounting system across, say, 50 locations, each with some variances or country-specific regulations or statutory reporting? No easy answers here, I have not come across a less than three-year plan for such deployments.
It is an acknowledged fact of IT implementations that they bring about change; when we look at large scale projects, the change is always disruptive (the level of disruption varies from positive to extreme negative). The subject matter experts from the business end up with pressure of maintaining existing operations while dividing their time to project led improvements. Setting expectations and constant communication that is the hallmark of large projects rarely finds its way into the smaller innovation projects. But can this be sustained over three to five years?
What about systems that are created with urgency portrayed by the business but languish in their use? Many times IT organizations work under undue pressure to create solutions deemed critical towards continued success or to react to competition, but they end up as ‘shelfware’. Unanimous in their reality this thread triggered reactions on or lack of sign-offs. Can the CIO in such cases cite past instances and refuse to toe the line? Probably not, the backlash of such behavior would be extremely negative to IT.
The fear factor?
When cloud-based solutions deploy new releases, some offer customers options to use earlier versions for a short while. Not so in the case of consumer apps; when a change occurs, everyone is impacted and learns to live with the new. Why is it that we are willing to accept the change in our personal space but abhor it in the corporate environment? Is it because that the stakes are higher or the risk averse nature of the corporate world?
I believe the answer is in our ability to switch off and move to another in the personal space, which is not even a dream in the enterprise. If the production planning or financial accounting were to face issues post an implementation or change / upgrade, our ability is limited to rollback and not to explore new options at that time. But I am hoping there will be a day when what applies to our personal needs will also be good for the enterprise. Then the CIO will have to work harder to stay in the same place.
Last week I was at a CIO conference with 80 odd CIOs representing junior and senior CIOs across verticals. Amongst other sessions, fun and networking, some vendor sales pitches, the big draw was a small contest run by the organizers titled, “My success story”. It was more than elevator pitch but less than a full presentation with each CIO allotted six minutes to talk about their learning on value creation, innovation, strategy, transformation, BITA, leadership lessons, or anything else.
The breadth of options provided enough latitude to the participants to choose anything they would like to talk about, the idea being that success has no one formula but everyone achieves success in their own way. The participants had to send in their briefs in advance with a panel for shortlisting six CIOs. Given the average work experience being over 20 years, the audience anticipation level was quite high. Selection of winners was based on an audience vote.
The second (I will come back to the first) one got off the ground talking about leadership and teamwork stressing on the qualities the CIO needs to imbibe. He acknowledged team contribution but stressed that the CIO makes the difference. The key message a good team with a bad leader will fail where a bad team with a good leader has a better chance of success. Ahem. A credible start with a weak finish sans examples did not get him many votes.
The next set of CIOs took a different approach. They struggled to create the magic moment and talk about their winning formula; everyone knew that all the speakers had achieved reasonable success in their long and illustrious careers. So where was the disconnect? These CIO leaders presented specific project success stories, a point technology solution in the recent or distant past that they were proud of.
Few were almost like a vendor sponsored case studies. Slide after slide talked about technology and benefits accrued from the projects. Can the implementation of unified communication, or video surveillance, or for that matter, business process management, even if it contributed to savings or productivity enhancements, be classified as ‘great success’? The stories faltered to bring out leadership aspects of the individuals and portrayed them as good IT CIOs falling short of the benchmark business CIO. They failed to capitalize on the opportunity.
The first speaker
So let me come back to the first speaker with no slides or presentation; the CIO spoke with a conviction that had the audience in attention. He spoke about a journey through the years graduating from IT Manager a long time back to the title of the CIO. He discussed many milestones crafted with the help of the teams, not just IT teams, but business and vendors too. He provoked the audience with questions. The extract below based on my notes from his speech is given below.
Over the years I decided to let go, the team was given responsibilities that helped them grow; in their initial years they needed handholding, or feedback, or just a bouncing board to help them understand how they were doing. Not all initiatives succeeded, the team took the learning and shared across to fail faster. This approach has seeded many leaders who are today successful CIOs in many companies across the globe. I can count more than a dozen such team mates who worked with me who have been able to also pass this learning within their own teams thereby multiplying the talent pool.
Success is always a result of teamwork; the leader needs to give the team freedom to take decisions. When they succeed credit goes to them, when they do not, the leader takes the responsibility for lack of success. Such teams rarely need to be reminded of what matters, they rarely let the leader down. My legacy today lives with most of such team members who are shining bright.
No guesses for who won the contest. Maybe everyone is doing this; however, we need to be better story tellers.
Every so often I read about the CIO role becoming redundant or the exigent need to adapt to the changing world. These thoughts and hypothesis are triggered by some disruptive trend in enterprise IT or conclusions arrived at by some research house or professor based on their data. A lot of discussion and debate ensues with many CIO rebuttals and an equal number running scared to save their positions. Is the CIO placed in such a fragile footing that can be dislodged with such ease?
So I started some research of my own reaching out to many peers to find out if they know anyone within their circles extending all the way to the famed six degrees of separation who was ousted due to any such tech or social trend which creates the hoopla. Spanning the globe and attempting to create correlations between technology lead trends and CIO movements, over the last year I have not yet found even one occurrence. My conclusion was that there could be two hypothesis based on the data.
The irreplaceable role?
First, the CIOs took the challenges in their stride and integrated the disruptions in their own ways into their ecosystem. Depending on the industry, geography, size, market standing, profitability to name a few attributes, the CIOs adapted to the change and created equilibrium. Not too many CIOs of today are from the COBOL / Mainframe era, but many have traversed from Client-Server and 14.4 kbps modems to the current multi-screen hyper-connected mobile world.
The second hypothesis is that all the propaganda is created by attention seeking paranoid people who either want to make some money out of selling prescriptions to cure the nemesis or just hate the CIO. Umpteen attempts are made to sell their version of snake oil; and unfortunately a few end up succumbing to the FUD factor. This adds fuel to the noise until a new black swan is found and the cycle repeats itself.
An invisible evolution
Every role evolves with times; the triggers differ depending on the role. In the same period in which the CIO role evolved, the CFO role too changed from pure accounting to treasury management, compliance, and investor relations. No one discussed ad infinitum expectations or created models for change. In fact, some CFOs also transitioned to becoming CEOs and so have a few CIOs in recent times. The factor by which pages have been filled with advice for the CIO to the CFO would surprise even the most outrageous guesstimate.
Darwin’s theory of evolution applies to every species; the same applies to a role or function too in the corporate world. Everyone has to adapt to change; for survival the species has to learn to embrace the new environment. Like the CFO did, the CIO has learnt to thrive in the chaos, sometimes revelling in it. Recent economic upheavals endowed the role of change agent on many CIOs. A few exceptional ones who did not live up to the challenge withered away into obscurity.
I believe that irrespective of the theme of the month, season or year, the perennial skill that will always stand good with every CXO is dexterity with business. Whether it is the internet, mobile, social media or commerce, micro- to nano-blogs, fads will come and go. Enterprises and businesses will acclimatize to some, sidestep a few, and struggle with the rest. The adaptive CIO will endure the onslaught, the unyielding will fade away into ignominy. The choice is there to make.
The poor fellow was looking harrowed after week long meetings sans his CIO with the big global IT services company with whom the company had entered into a long-term strategic services contract. Six months having passed since the signing of the contract, he was wondering whether the decision can be changed or penalties levied for not meeting commitments, the contract protected the vendor in the transition phase. The presales team which was a permanent fixture in the office earlier was now trying to avoid coming to the meeting very well knowing the situation not being favorable.
Over a year of courting, discussions, negotiations and going over a long legal contract, it was a sigh of relief for the vendor and the enterprise when they did sign off the deal. As all strategic sourcing deals go, there was an expectation of maintaining business as usual with improved efficiency and lower cost; then move on to transformation driven by tools and technology which was the investment promised by the vendor. Over the decade of relationship, it was expected that there would be efficiency of scale, savings on the table, and investments in innovation with global benchmarking.
The big team arrived soon enough to transition services and fit or change existing processes into their framework, which they managed with some difficulty. Within a few months, unable to scale up to diverse needs across locations, changes in the management team were enforced and that brought welcome improvements though not commensurate to expectations. The first big review meeting was a shocker for everyone. Some milestones achieved, lot of work in progress way past due dates, a few endpoints seemed a long way off; the CIO who was well known for his patient handling of crisis lost his cool.
Opacity in contracts
To begin with, the interpretations of clauses done by the execution team were in conflict to understanding while drafting them into the contract. Stretched timelines became super-stretched timelines; senior consultants attempted to provide solace with no Plan B in case success eluded the team. The ‘high tension’ meeting resulted in change of pace and ‘compromise’ in favor of the customer. With new timelines cast, the pressure was on everyone; avoidable pressure as agreed by everyone present.
Why does delivery rarely match presales promises or timelines? Are sales teams preconditioned to sell unreasonable timelines or commitments to bag orders from unsuspecting and gullible customers? No, I am not calling the CIO names, but admiring the ability of the sales teams to sometimes get away with untenable contracts. I am also bewildered at the ability of delivery teams to squarely make a hash of even normal service delivery expectations. What causes history to repeat itself in almost every engagement?
A communication issue?
In this case, the CIO summed the case up with one phrase: “lack of consistent communication across the ecosystem”. The presales team did not spend adequate time taking the transition team through each and every clause and expectation. The delivery team found significant differences on the ground to their assumptions which required change. The project lead busy fighting fire every day forgot that consistent communication is essential to setting expectation, managing perception and finally success.
I believe that it does not always matter what you do; what matters is how you communicate what you have done or planning to do. No news is not good news when everyone is expecting some change. Otherwise strategic sourcing will become a big tactical pain where real life experience defines success.
The number of IT professionals taking on to consulting after multiple changes is increasing. A lot of them were considered high potential when they worked within corporate IT functions. Some of them were also CIOs who chucked their cushy jobs to explore entrepreneurship. I started tracking down some of them to find what made them take such a step. The answers were surprising and not so surprising when analyzed rigorously.
Now consider that in recent times the lament gaining popularity is the inability to find good talent; with global competition and willingness to relocate, good professionals are always in demand. And the good ones always find it easy to bag the next opportunity. That being the case, why is it that the CIOs are struggling to hire and retain good talent?
Every manager or leader has one key benchmark when interviewing people: themselves. We hire people based on our own competencies. Most (fortunately, not all) managers want to hire staff with equal to or lower skills than themselves especially for senior positions. Maybe, it is their perception of threat to their own positions; maybe, it is a low risk model when you know that the person will not be disruptive by challenging the managers’ decisions. This manager wants to know everything and be part of every meeting thereby becoming the bottleneck to progress. S/he feels insecure when new solutions are presented by others which impact his domain.
A great way to maintain status quo or to keep the lights on, in this case, the CIO will perennially be challenged and discuss BITA (Business IT Alignment). The team at best delivers mediocrity and is relegated as a support function with limited participation in activities outside of their function. Organization culture too contributes to this state compounded by the CIO not reporting to the CEO. I have seen good CIOs get out of such companies as soon as they could.
Challenging the status quo
Now, when you look at high performance teams, the leader acknowledges the need for diversity and challenging status quo. S/he has always hired different skillsets and encouraged open innovation. One of my observations was that these leaders define the direction and then get out of the way leaving the teams to soar to new heights. They do not micro-manage, they facilitate and encourage the team. Making mistakes is acceptable, repeating them is not. Attrition is normally low.
I believe that to create a winning team and not an also ran, the CIO needs to balance command and control with empowerment. Everyone does not need close supervision; neither can everyone be left to do their own thing. Delegation is good; however delegation does not imply abdication of responsibility. Incorrectly delegated work can lead to challenges and success denied; the CIO should own up to equal share of success and failure. After all you cannot be the father of success and know no failures.
An old adage — “People join organizations, people leave their bosses” — holds true today more than ever. It is not an Oscar award speech but many leaders acknowledge their teams as the reason for their success when felicitations come the way of winning teams. The team too holds no grudges against the leader who is held high in trust and respect. The new age CIO is making these choices, are you one of them?
For most companies that got started with their IT journey in the era of the mainframe, their journey through the evolution of technology created problem of the plenty. Client-server was a favorite for department apps, and the browser made proliferation easier beyond the department. With X-base, it was easy to create small specific-purpose apps; even users could churn some code that soon turned mission critical. The ERP attempted to consolidate all processes and apps, but most survived the onslaught citing unaligned ERP processes or mission critical status. The cloud now adds to the complexity by making it easier for new apps to flourish.
Maintaining legacy apps
Every company thus maintains consultants (sometimes ex-employees who developed the apps or maintained them before retiring), vendor relationships, or deadweight to sustain the process these apps enable. Esoteric technologies requiring some antiquated infrastructure continually escapes the axe whenever renewal is discussed. Proportionately, larger the company, bigger the number of apps it has. Examples that I have observed include more than 40 instances of core ERP; another proclaimed build-up of 8,000 apps over a 25 year legacy. Many did the same thing for different people using different technologies, but neither wanted to change to the other.
How do these apps defy all attempts at eradication and survive even the strongest attempt to weed them out? Their patron saints are strongly entrenched in the corporate labyrinth and any change is touted as disruptive to the business. The CIO after a few attempts gives up in favor of bigger battles to fight with higher business impact, thus leaving the long tail of applications wagging the IT function, more often than pleasant. Thus, many people within the enterprise continue to exist to keep the machinery chugging, despite options of a better way of life.
Replacing a redundant app
An interesting phenomenon was recently narrated to me by a much acclaimed CIO of a well-known and progressive company, when his users started defending a not so good a system. This app was a sore point for the functional owner as well as the IT folks because of its unusable interface and complex execution of processes. Everyone hated it and it attracted jest and ire in every management meeting. With no change being pushed from the function heads, the CIO finally decided to do something about it and started an initiative to replace the solution. This is despite the fact that the new proposed app was offering a significantly superior experience and ease of administration.
Is this only about change management or is the issue much larger? I believe that the CIO should delegate the task of systemically going behind the hidden long tail of apps and wiping them off, to some of his/her team members. When they are working, no one is complains; they give sleepless nights to IT when they fail. Is there an easy way out? No, so keep on pushing, nothing good came out of staying put and maintaining status quo. Change is always difficult, but change is the only constant.
If you don’t like something, change it; if you can’t change it, change the way you think about it.
The craze for new gadgets and devices appears to be growing day by day. Emotions run high for some iconic devices and brands, where people are willing to endure cold nights and mornings, waiting for the store to open. The queues are visible across countries, so it is a global epidemic. These are normal consumers vying with the technophiles to be the first to own the product!
I own multiple devices including a few from the company in discussion, but never stood in queues to be amongst the first, though I know a few who did. I have always waited for a couple of revisions or generations to pass by before acquiring the new iconic device; the primary purpose seen seems to be displaying it prominently or announcing it by the footer in the email.
I get carried away; this is not about new devices or the long queues, but about rotten eggs. In China, fans threw rotten eggs at the stores when the company announced to the teeming crowds who had queued up for long hours that they will not be selling the much awaited device. The decision, as the announcement proclaimed, was taken for the security of the customers who turned up in large numbers. Did those customers come armed with eggs waiting for the store to open?
The incident triggered many wild thoughts. Is the idea extensible to other irritating behaviors, from, say, IT vendors who take the CIO community for a ride? What if every time there is a breach of trust, can I shower the vendor sales or support teams with choicest tomatoes (I am a vegetarian, you know!)? Is this a feat worth emulating when projects do not meet timelines or when misunderstanding of basic requirement by ignorant consultants becomes a change request?
It does have finality to the statement it makes: If I don’t like the outcome, I am going to demonstrate my ire. S’il vouz plait, it may aggravate the situation, but it does create a warm, fuzzy and a lighter feeling to have vented out the frustration and anger. Will the slinging match create a better relationship between the CIO and the other parties?
Last week, while working on a few post contract changes to some service delivery benchmarks, I had an urge to pelt a lot of stuff on the negotiating party. My primal fantasy had to be suppressed to stay within defined corporate behavior and work on the issues step-by-step, steering it towards desired outcomes. Civilized acceptable behavior does not provide latitude to hurl objects when events do not take the turn we desire; even when the consumerization of devices brings unwelcome distractions.
Relationships are built over a period of time, but they can be strained for a long time in an unguarded moment. This applies to any relationship, peers, bosses, team, vendors, family, and friends. CIOs forge relationships possibly with a larger set in comparison to some of their peers. Success is highly dependent on setting and managing realistic expectations. Service delivery and change management are key tenets of the IT agenda.
After all we don’t want to be at the receiving end of the rotten eggs.
Kids ask the most interesting questions; they make you scratch your head and think. I had this experience recently when interacting with a gathering of B-school kids. The occasion was an event organized by the students with the industry exploring insights and networking. One such session was around the challenges and opportunities for the CIO. The CIOs present were heartened that the role is one of the aspirational careers.
The question that stumped some of us went something like this. CIOs take decisions on IT strategy and architecture thereby setting the foundation of the technology that will enable the enterprise for a long time. So when selecting an ERP or similar system what are the criteria to select one over the other considering that once a specific technology is chosen, it will stay for a really long time. It’s like a lock-in because no one changes ERP systems normally. How do you then manage cost escalations and support?
ERP implementation and all that follows
Now, as I know, the question is largely an accurate portrayal of reality. At the time of selecting an ERP, every enterprise painstakingly reviews most options before assigning the family jewels to the solution. Such magnitude of projects is always launched with fanfare, with senior management speeches and project naming ceremonies. Committees are formed with best intent and sooner or later the project goes live. I am not getting into the success or the challenges that typical projects face; that’s another story.
Over the years, with increasing licenses and customizations, the sustenance cost starts to hurt; CIOs find ways to reduce support costs or squeeze licenses deployed to keep operating expenses low. The thought of replacement is rarely tabled and considered impractical. How can such a change be ever executed? Who will drive this? Change will be disruptive to the business. The cost of replacement will be extremely high and not worth the effort.
The perils of ERP replacement:
I am sure that these reasons have some echoes for every CIO. Change is indeed a herculean task when it impacts almost everyone in the company; especially so when the change will have the biggest impact on the IT organization. Apart from the change that every employee will have to go through, the IT teams will have to get out of their comfort zones and drive the change from the front while keeping the lights on and business chugging along as usual. So is ERP replacement the peak that no CIO wants to even attempt? Or is it only for the few brave expedition leaders akin to climbing the Mount Everest? Yes the biggest peak has been climbed a few times and so has ERP migrations done with sparse frequency. Why this reluctance in proposing the change or embracing the challenge to climb mountains?
I believe that the vendor lock-in created around the difficulty of ERP change is to some extent promulgated by the CIO. It is time to abandon this myth and start exploring new horizons in the new world being created around us. We can be part of the creators rather than accept status quo irrespective of whether we were part of the original decision or not. Every decision taken is based on facts at the time and is largely a correct decision. Should we allow this to constrain the future? After all, if you keep climbing smaller mountains, no one rejoices with you as much as if you did climb the Mount Everest!