With the advent of the Internet two decades back euphoria around internet based business models exploded upon all of us. Predictions like “if you are not on the web, you will be dead or if you don’t have an internet strategy, you don’t have a business strategy” shook up everyone and pushed them towards limits of paranoia. Untenable valuations on shaky business models led to the dot bust that wiped out millions from budgets and zillions in market capitalization. Now digital is rivaling the din of the past and it has everyone scrambling again.
Some CIOs saw it coming earlier than others; creating awareness within their enterprises, they attempted to raise the bar. Initial reactions of cynicism and indifference led many CIOs to return to their comfort zones while the world around them flirted with the digital wave. As success stories started trickling in, it gave jitters to the disbelievers and created a flurry of disconnected activity. Every CXO wanted a digital project; everyone added the word “digital” in the headline; many ignored the CIO to avoid embarrassing discussions.
SMAC came the response from consultants, vendors and the IT folks alike; to get started on your digital journey, you need the skills, talent and a link back to the physical world that IT provides. Many CIOs reveled in the limelight of having been ahead of the game while the rest joined the confused ranks adding to the chaos with technology play. As individual pieces of Social, Mobility, Analytics and Cloud made way into various initiatives, the picture started to become clear that digital is not an option anymore; it is going to be a way of life.
Board room and management discussions on digital attempted to create correlations with revenue growth, customer service, enablement of suppliers and business partners, automation for improved process efficiency. Now the connections to enterprise goals are shifting the discussion from the likes of Big Data Analytics or Mobility to creating new business models or tapping new profit pools and outpacing competition. Everyone wants to be anointed with title of the CDO to be hailed as the hero when success arrives.
Competition from new age companies in some sectors like hospitality, retail, virtual collaboration, and travel and entertainment has disrupted conventional age old business models leading to a scramble to catch up. Industrial giants slowed by corporate inertia are waking up to new threat and opportunities. Willing to use their scale, muscle power and enormous resources, they potentially have the ability to devour the small fish while they establish new business models and reinvent their business, systems and leverage the digital wave.
Silos of digital initiatives will at best test a hypothesis, for enterprise wide impact, cohesive and integrated approach with CEO alignment is essential. Reality is, IT and business strategies are no longer separate, and they have become inseparable. With everything going online and “Internet of Things” creating an avalanche of hitherto unexplored data, enterprises are pushing the boundaries of analytical possibilities. Corporate and information boundaries are disappearing demanding democratization of analytics and decision making.
The oft repeated question to CIOs raises its head again on their position in this evolutionary revolution? IT teams need to focus on not just scale but also the new application ecosystem that requires IT teams to discard legacy and pursuit of monolithic systems and shift focus on agile built for purpose apps. This paradigm shift requires preparation for non-stop business in the interconnected world. Customers are challenging the business of incremental innovation and forcing companies to listen and co-create new products and services.
Digital is here and how! For most CIOs BYOD/T was a beginning, BYOW (Wearable) will stretch the already delicate ecosystem. Finicky customers expecting instant gratification threaten fragile brand reputations with 140 characters and less. Consumption patterns are shifting thereby forcing CIOs to rework corporate peer relationships. I believe that CIOs can reclaim lost ground by challenging existing digital alignments and build the foundation that will help the enterprise win in raging battle for revenue, profitability and the customer.
Your enterprise digital stance may be a challenge at the moment; culturally maybe the company does not enable open ideas or visible risk; it is up to you to decide whether you want to be a bystander while the world moves ahead or you want your destiny to be linked to the new world of digital enablement? Are you ready?
That was a big debate as debates go though not as big and passionate as the Business IT alignment or for that matter on the changing role of the CIO or the shortest trigger which is the CIO reporting to the CFO. Conflicting and alternative views were aired by those present; by the time the group broke up there was no consensus and everyone agreed to disagree in defining or classifying a “best practice”. The innocuous subject of discussion was how should the IT team and/or the CIO select a package or solutions vendor!
For business as usual application support, break-fix maintenance services, system or database administration, network management, data center and then the servers, storage or network devices, vendors are largely selected and managed by the IT team. In many cases the CIO is happy to let go and have his/her team manage these relationships, service levels and depending on the governance model, the negotiations. These all comprise operational IT which is essential to run the business and is only noticed when something breaks.
Enterprise projects or new initiatives represent a different set of dynamics; the heads of function(s) impacted their CXOs and their operating staff which will feel the change, most of them have a view on the right or the best or the cheapest solution. Industry benchmarks based on global industry and local market view and competitor information provide a starting point. Then there are favorites based on past experience or use in previous company that skews the selection process depending on the seniority of the person pushing it.
Most initiatives start with an internal discussion with internal stakeholders on solving a business problem or tapping an opportunity which culminate into documented requirements and outcomes. This is when business likes to handover the reigns to IT to find the most appropriate solution, negotiate, implement and deliver the outcomes. Technology CIOs love this though this hands-off approach “I know the business and you know the technology” has had its share of challenges with iterative development and delayed timelines.
The more formal process expects a Project Initiation Document or some kind of document prepared by Business and IT, which is then circulated and signed off to formally start the search. RFIs and RFPs follow resulting in colossal volumes of paper which no one reads; subjective and objective scoring of responses create a vendor shortlist who are invited to present to the group that sees diminishing participation over time. Final set of vendors are grilled and the winner is announced; such a process requires high level of maturity to sustain itself.
Research companies and third party assistance for independent assessment based on formally defined parameters was touted as the way to drive a decision transparently. This was accepted as the best and irrefutable methodology in the past though not too many had used it due to the cost of conducting such an exercise and the discovery of secret alliances such companies had created with vendors. Then a junior CIO murmured about a research company changing the parameters to put forward a vendor based on his boss’ choice and directive.
The view of many in the group was that users don’t know enough about the landscape and choices available; they should stick to defining the problem or articulating the opportunity; partake in the requirement gathering and participate in the testing, training and deployment. The counterview expected business collaboration through the project with equal ownership from concept to execution. Both camps spoke of their experiences – successes and challenges – which were in ample quantity to pick from.
As I see it there is no right or wrong way to select a vendor; in many cases the choices are not really choices with dominant vendor position for the process, function or industry. IT maturity, governance and credibility play a strong role in whether a unilateral or collaborative approach is best. Internal strife if any is best managed within; in either case, it is critical to not lose focus of the expected outcomes and project a unified view to potential vendors and partners. For CIOs to stay relevant as business partners they need to be adaptable.
It is our attitude at the beginning of a difficult task which, more than anything else, will affect successful outcome!
Over the years economic cycles have turned all conventional wisdom upside down; the new normal that became reality before the turn of the decade squeezed all the unnecessary costs out of every line item in IT budgets. Do more with less being the mantra, CIOs scrutinized operations and optimized them ruthlessly. Half a decade later and half way through the year, one of the resurgent themes with many CIOs is conservation of funds; revenue growth has been under pressure for some time, bringing costs back into focus.
In an informal gathering of CIOs this was the predominant theme with everyone attempting to figure out where do they get additional savings from ! Hardware refresh had eliminated maintenance costs for a few years, but now maintenance and support contracts are up for discussion for all the critical and non-critical hardware. Users now expect desk side support for all types of incidents and problems; with rising manpower costs, hardware service vendors and maintenance providers are demanding inflation linked increases.
Last time around there was a flurry of activity around license management; are people really using their allotted licenses? Thus software license costs were pruned down to the bare minimum required; number of users has gone up now and there is a need to buy additional licenses. Vendors pushed usage audits and attempted to enforce compliance to license agreements putting the CIO in a precarious situation; no one wanted to be non-compliant. Open source again became a discussion with limited success for some.
Back then again contracts for running legacy and custom applications, and maintaining business as usual were trimmed; wherever possible the activity moved to internal resources. Onsite activities were offshored to the service provider’s premises; back office functions relegated to low cost locations in the suburbs. Contracts were examined afresh and brought down to a bare minimum. A few also took the tough step of letting some of their team mates go and reallocated portfolios stretching the remaining team. FUD ruled for a while.
So where do we look for new savings opportunities? How much more can we do with less lamented the group? The group had no bright ideas, nor any best practices to share. One of the CIOs present gathered sympathy for a 25% cut imposed on her capital investments as well as operating expenses and still expected to run projects as well as keep the lights on with no adverse business impact. Someone suggested that she conduct an open dialogue with her boss and ask him for ideas on how to implement the cut.
Systematically the group explored some of the options that vendors pitch in as cost savings measures. Is the Cloud with pay-per-use models a viable option ? Variability has been one of the promises from the cloud; but then the proponents of this model cautioned against if cost savings was the primary objective. If you moved existing loads to the Cloud, what would you do with the existing hardware? It would anyway make sense only if there was a need to increase compute capacity or hardware refresh was imminent.
Can and should total or strategic outsourcing be explored? That is when most vendors promise 20+ percent savings and projections are locked down for a number of years! Transfer the accountability and let the vendor figure out how. A couple of CIOs who had been there done that cautioned against it. They have had a harrowing time making some of the numbers in the spreadsheets stick in real life. Legal teams poured over contracts to find a way to make it stick; the CIOs ended up in getting the stick instead.
Most organizations which are driven by ratios and numbers resort to cost cutting rather than cost management in their attempt to keep the street happy. They want to look better than their competitors and keep the stock price high sometimes even at the price of damaging the DNA of the company. Consultants get hired to find hidden costs while they get paid visible money with diminishing returns. I believe that enterprises driven by customers don’t resort to cycles of cost containment and thrive in adversity.
A lone voice in the room asked, “Can we look at increasing revenue instead?”
Should I take up the new offer I have? It’s offering over 50% rise and a larger responsibility. The industry is the same and the company which is a recent entrant is growing in leaps and bounds. I have been in my current company and role for over 4 years now and it has a great work-life balance. So moving to the new assignment would entail moving to a new city, unknown people, unknown culture, starting afresh building credibility and gaining acceptance from the team as well as peers which would take a year or so.
The CIO was past his mid-life crisis and leaning towards his sunset years with about a decade of active working life remaining based on generally accepted and regulatory definition of retirement age. He was doing well in his current company having spent a decent amount of time managing process, systems and expectations. He had been successful though not overtly so, but consistent in his ability to deliver to promise and keep progressing. He was been headhunted for the first time and was excited by the prospects of the new role.
He was also heavily into work-life balance and an example for some of us on keeping the balance tilted towards life more often than work. While his demeanor suggested a laid back person, he was effective in managing tasks, projects, budgets, suppliers and customers with ease. Financially stable and well off, he was not driven by monetary incentives nor materialistically inclined. Thus I was a little taken aback with his meanderings considering that he was of a sure mind and rarely hesitated or consulted anyone in such matters.
Challenging him to listen to his heart rather than the mind if they were in conflict, I asked him what caused the dilemma? Was he unsure of the new organizations ability to succeed in the chosen industry or was it the comfort zone that caused the see-saw decision? It’s not like that he had spent a lifetime in the current company; why was he feeling discomfort by the thought of change? Continuous prodding finally brought out some interesting tenets for his inability to take a decision and it was not an easy one to solve.
Growth in current company would come over time; it was a profitable and stable entity where he had the freedom to operate. He knew the system and how it works; he had a good team and they delivered consistently. His family was well settled in the current city; wife working, kid entering last year before college, other kid getting to his first job in another city. He had just bought a house with a mortgage and done it up with a lot of care. Workplace being a stone’s throw, he enjoyed life to the fullest even after putting in the required work hours.
The new entity had expanded fast and planned high growth in an industry which had a lot of promise but not too many made money. There was a lot to do for the next couple of years and he would hopefully grow with the company. The new company had a frugal mindset and culture vis-à-vis his current one. Work-life balance would become a memory with pressures in the company, a new entrant in an industry requiring deep pockets. Success would come but require far more effort; comfort versus challenge!
Would you sacrifice work-life balance and family over career? How do you prioritize and determine where you should focus? At which life stage should life takes precedence over career or career over life? When do you reach a point that you get off the treadmill? Many have given up careers to pursue their hearts desire or become entrepreneurs on reaching financial goals; some remain hesitant with fear of the unknown. It is easy to stay in the comfort zone until life gives you a push to get out and start afresh.
I believe there is no right or wrong, no good or bad decision. The inflection point varied by individual; open a restaurant, write a book, teach at B-schools or colleges, the calling has varied for some of my friends. My recommendation to my friend was to take a few days off and introspect for the future and find what keeps him going every day. If you can dream it, you can also make it possible. I for one have been conscious of comfort zones as they give me discomfort. What would be your advice or what would you do?
The flood of resumes was overwhelming; I was surprised by the numbers wondering if there was a crisis out there with people wanting to leave. Maybe it was the company and its reputation that created a pull of sorts that the applications found exciting. Or it could be that the economic situation has resulted in uncertainty in their current positions and thus they sought a comparably stable environment. Anyway the problem of plenty was a good problem to solve which gave us the option to choose from the best and the brightest.
Sifting through the lot it was difficult to shortlist probable candidates; everyone appeared to have been there done that, a menu card of technologies that they professed to know and work experience that would make you want to hire them right away bypassing the process. Discounting spelling errors in favor of experience, the final list of interviewees was drawn up. The list was not as short as expected, but then we did not want to miss out on deserving candidates just because they had turned off spellcheck or had bad grammatical mistakes.
Not having conducted so many interviews at a go, they had to be spread over 3 days with almost 20 candidates. In tow a HR colleague and the functional lead who wanted to evaluate technical skills, armed with a formal assessment sheet to capture impressions, we started the process; questions were divided to suit our respective functions. HR would break the proverbial ice, settle down the person, my teammate tossed difficult technical questions and I looked at attitude and confidence. The days passed by in a whirl and we had a winner!
We have been taught to keep our demeanor friendly and suppress emotions while conducting job interviews; it was difficult to hold on to sanity and control laughter in few occasions. The journey to the end was excruciatingly painful and frustrating; the candidate with the perfect resume turned out to be a disaster. She had put in all the right keywords, technologies and projects; she had been in projects with the technologies in a role that barely gave her basic understanding. Scratching below the surface revealed no substance.
Another one believed that he scored 10/10 on every skill mentioned in his resume and that he had reached the pinnacle of learning. He was stumped on most of the questions which led to his quick exit. One candidate kept repeating that the information about the projects he had worked on was classified and that he was under NDA and thus could not talk. One person narrated the long story of her life for about 30 minutes immune to any attempts at interruption. We thanked her for the enlightening moments and heaved a sigh!
The quality of most discussions made us wonder about current state of knowledge and expertise; or is it that the unwanted and incapable having realized their shaky existence decided to seek newer pastures. Are these the types who find themselves on the left side of the traditional HR performance bell curve? My HR colleague mentioned something about finding the right talent through references and not an open process. Junior and mid-level hiring filtering done by executive search companies and headhunters is typically based on keywords.
The selected candidate did not have all the skills required for the position; he was short on qualifications though the experience was relevant. Knowledge on technology was above average with understanding of his own limitations. He demonstrated how he stayed abreast of current trends and could articulate how he worked in teams. His enthusiasm and candid responses had all of us liking him; his can do attitude clinched it in his favor. We exchanged notes and everyone was in agreement; so we made him an offer.
We were pleased with our find and wanted him to join us expeditiously. He accepted our offer and promised to revert on when he could be part of our company. Weeks passed and HR kept following up on his joining date. One day I receive an email: “I thank you for your offer and opportunity to work for your company; I have carefully considered it and after much deliberation and discussion, I have decided to stay back with my current employer. I wish you all the best and hope our paths will cross again in the future.”
Life is tough!
It’s more than 20 years now from the first collective industry recognition (Energy Star ratings) and the desire to do something about reducing power consumption by IT equipment. The cycles of heightened awareness and hype coincide with economic cycles or at times a paradigm change brought about by new technology or use of existing technology like virtualization or cloud computing. So when one of the organizers asked me to talk about Green IT, I was perplexed on the unexpected resurgence; or was it a red herring or just a slot filler?
Researching the market beyond personal experience to understand the current traction and prominence of Green IT, I started talking to CIOs to understand their journey or milestones on the subject; I was hoping to use some of the insights in my presentation to an audience of CIOs. Thus over the next few weeks the data points that I gathered did not focus on public or private clouds, but to understand if Green was still a discussion in different industries and industry leaders or has Green fatigue set in?
Less than a decade ago carbon credits were a boardroom discussion and some people made a lot of money trading them; then they just vanished. Data Centers started touting Power Usage Effectiveness (PUE) or Data Center Infrastructure Efficiency to demonstrate how Green they were. Overhead non-compute power usage for cooling and other uses ranged from typical 80% to highly efficient 10%. Power used by servers and computers for the same task has been reducing almost linearly over time challenging PUE.
CIOs finished fixing the data center quite early and also created efficiencies for end compute devices with power management policies and improved awareness. From there on they focused energies on office infrastructure, ambient lighting and temperatures, electronic documentation, communication and as a result saved trees. A few also took control of energy usage monitoring with embedded and targeted sensors linked to BMS (Building Management Systems) and reduced power consumption in good measure.
The question is, with so much getting done and almost every enterprise reaping the benefits over the last decade, is Green still a relevant discussion? Who if anyone is tasked with overall enterprise Green initiatives? Is it only about controlling power used or creating a movement to conserve natural resources? Is Green an integral part of decision making explicitly mentioned in evaluation parameters or implicitly used in every decision making? Have people stopped flying around for meetings and embraced Video Conferencing? The answer is yes and no.
I don’t believe that CIOs are measuring and reporting metrics around Green. None of the CIOs I met did, but there is a discussion around power efficiency and overall cost of running BAU or keeping the lights on. CXOs are not enamored by earlier conventional solutions which are now basic hygiene as are new LEED certified buildings. Reality is that for technology and compute power, the bar keeps shifting every 4-5 years; what was green in 2000 or for that matter even 5 years back appears archaic when compared to currently available hardware.
At the conference the audience engaged in a discussion and debate on the relevance, challenges and opportunities; one of the participants sought suggestions to break the cultural vice around personal printers which gave his global centurion company a person to printer ratio of close to one. Someone shared extreme automation to switch off lights and air-conditioners when there was no movement resulting in hilarious and occasionally dark and sweaty situations while people were in the room working!
Green is here to stay and awareness of the new generation brings new opportunities. For CIOs it is important to seek avenues beyond the conventional interventions of the past. Cloud computing is shrinking the data center and mobility is driving the workforce out of offices. Power generation is focusing on renewable energy sources which reduce the global carbon footprint. Some of the power hungry enterprises are going to embrace these as the world works towards creating a better tomorrow.
The role you play in this evolution is up to you!
“You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new.” So said the most iconic leader in the IT industry and stuck to this philosophy as his company built some of the most vied for products; the success that followed remains unparalleled though the bull run has slowed down a bit. Everyone wondered exasperatedly on how they can replicate this model as it is contrary to conventional wisdom and what they were taught in B-school.
Until not too long ago the software industry churned out products with features and functionality based on internal discussions on what the customer may need or in some cases based on what their initial customers asked for. With generic solutions not fulfilling the expanding needs, over time they started hiring industry domain experts to create vertically aligned solutions. This did address the gap partly for a while and then customers started demanding better aligned solutions for their specific problems and opportunities.
Some companies recognized the need early and started creating Customer Advisory Boards (CAB) with CIOs of their large customers to participate in the product roadmap. This was extended to include some of the innovative adopters of their solutions though they may not have been high revenue customers but brought value to the discussion. The ensuing engagement, discussion and debate influenced the prioritization of new features and in some cases the positioning of their solutions resulting in a win-win situation.
Some of the services vendors took the cue and hired from the industry to strengthen their industry practices; consulting companies followed suite thereby changing the discussion with their customers. They determined that the need was to embed the resources internally and not limit to an advisory role. Now the software industry is going through a transition with even mid-sized companies thinking of CAB to gain the benefit of customer connect and better alignment of their product features and evolution to what the industry wants.
Interestingly hardware manufacturers have remained disconnected; they continue to launch products with the philosophy of the icon attributed with the famous quote. Past practice of customer focus groups has largely been discarded by marketing teams. Faster processors, bigger, brighter and higher resolution screens; consumers love it and they do more of the same. Then they have attempted to push the same products to enterprise customers and wondered why it is not gaining traction the way consumers are lapping them up.
CIOs are not excited; what else do you want has been the lament? Over the years the clear message from many CIOs to the IT industry enamored by all things mobile (phones, tablets, and applications) has been that the faster, better, cheaper does not connect with enterprise use cases. Enterprises need manageability, serviceability backed by service levels, and reasonable (measured in years not months) longevity. Consumer devices require additional investments to make them work in our environments.
Consumer applications and games are great; couple of apps on the app store for some customers or pilots on industry specific use cases does not make you an enterprise ready development partner. We don’t want to explain everything from the basics to your team; how are you going to fill in the gap between what we say and what your team understands. Do some homework and more than anything else listen before you start crafting solutions; you have an advantage over your big competitors, use it well.
The question is then, is CAB the way to go for companies who want better traction of their solutions or services in the enterprise space? It is a model that may work for the larger IT companies; how does a smaller outfit get the benefit of the experience? In “Scaling Startups” (http://cio-inverted.blogspot.in/2014/03/scaling-startups.html) I had referred to a mentoring model and role that CIOs can play; maybe it is time for IT companies to embrace CIOs to help them forge ahead. What is important is the change in mindset and philosophy with internal agreement on the new way of working. I hope IT companies understand this sooner than later.
As a CIO, are you up to the game?
The country is going through the most complex exercise of voting for and electing new representatives to the government. Selecting amongst the candidates is difficult; some of them are easy to disregard as they have no visible credible experience to stake a claim to the seat. Handfuls have relevant experience and on paper they look like good options. References to past work demonstrate their ability to deliver and execute; a couple have the backing of their respective political parties who lend the promise of a collective manifesto.
Every 5 years this process repeats itself, sometimes a little earlier if the incumbent government is unable to serve out a full term. Soon we will have a new government, a new head, a set of ministers who will vie for the most visible and high profile ministries. The correlation between portfolios and core competencies is always a good thing to do; however many a times that does not happen. Bureaucrats and the staff within the ministries does not change much, they follow the new directions set by the ministers irrespective of expertise.
Running an enterprise is very much like running the country, especially a large diversified group with interests in varied businesses. Each company and function has a head that is selected from outside more often than inside. The selection is most of the time purportedly on core competency and merit. The difference between a government and an enterprise is normally the available options from which a candidate is chosen. In a government, the candidate is from the elected party, in the other case almost everyone can apply.
Government portfolios are presumably distributed by the head of the winning party and head of the country collaboratively. Most often decisions are based on seniority, past experience, credibility and interest. Cross functional movements are the norm and it is expected that the person would do equally well in the new function too. The rationale here is that a leader need not be a functional expert; the team has adequate skills to advise the leader on the best options when taking a decision. We know how well this process works.
In the corporate world the skew is more towards functional expertise while selecting a person. Cross movements do happen at beginning and mid-careers; moving up the ladder, these are rare. Leaders at the top take on additional responsibilities at times; lateral moves occur but are not frequent. Success rates are higher in comparison as everything is expected to be time bound. It is not a sure shot recipe for success; we do observe failures across the board, many attributable to the leader not being effective or fitting in.
It is not necessarily the interviewer or selectors inability to assess that result in a bad selection. Drawing parallels, it is evident that the best person does not always get selected for the job; favoritism and at times other factors like past workplace association, belonging to same religious sect or geographical area, been to the same school/college, having the same ideologies, result in suboptimal choices. While not always avoidable, enterprises do watch out for such hires critically lest they end up with unwanted baggage.
It is relatively easier to replace a person within an enterprise as compared to the government; performance appraisals even though many a times skewed do elevate non-performance. On the other hand, recently observed citizen activism has its place in creating change. Cabinet reshuffles however move the problem from one area to another; this is rare in the enterprise though not unheard of. Are there learning that can be applied to enterprises to not follow the same path that ails many parts of the government?
I believe that when we choose an elected representative or a new hire, in both cases rigorous due diligence is essential. Our choices can come back and haunt us not just in the short-term but also in the long-run. Both impact our lives and future; we tend to spend more effort in our workplace due to impact proximity and blame bad decisions to the ill choice of others. If we want control of our future and destiny, we have to exercise our rights and influence outcomes. Can we afford not to?
You decide, you have a choice!
Not too long ago one of the consulting companies’ classified people by their digital proficiency and created three groups; digital dinosaurs, digital migrants, and digital natives. This was picked up by many people who used this classification to target their solutions or services to their respective benefit. The resultant divide did not matter to the bourgeois or the elite, they anyway continued to demonstrate behaviors that they did; the world continued to evolve, and gave way to a new species, which is gaining ground.
Characteristics of the first three categories were quite easy to comprehend and evident with their names. The Dinosaurs are the people born before the advent of technology (today’s 60+ generation) who use basic technology to stay connected. Migrants (born before 1990 or thereabouts) embraced the new technology wave sometimes a bit uncomfortable, but more or less adept. The Natives are born into the new world and do not know of a life without social media, mobility, ubiquitous connectivity and instant gratification.
As is with all kinds of evolution, there are genetic mutations, exceptions and the differently abled who do not partake in the normal. They have all the means, the environment, the facilities, the stimulus, the desire; they show a lot of promise and demonstrate a stray spark of brilliance. These individuals are mostly found in the cusp of the natives or wannabe migrants (migrants who believe they are better natives than the natives themselves). It does not take too much of an effort to spot them, they are visibly obvious.
In a digital conference with average participant age less than 24, we tried spotting the pseudo natives; one of the sparsely haired speakers in mid-40s was desperately trying to impress the audience with his knowledge and investments into digital startups. A mobile cloud, take it anywhere you go; make 2G work at 3G speeds; family only social media, were some of the references to his invested concepts which he believed were ahead of the evolution curve. No one had heard of his ventures but the crowd humored him to get his wallet share.
A corporate 20-something CDO (Chief Digital Officer) reveled in the fact that he was ahead of his peers having already achieved the pinnacle position in an industry which was always in the forefront of digital technology. With an MBA from a prestigious institute, he strutted around to the envy of others who wanted to get there. He was on stage being interviewed on his vision and predictions of where the digital world was headed. Not that he wanted to entertain the audience; his responses had most people snickering.
His stated digital strategy for the company revolved around leveraging an existing portal which had lost traction with customers. Is mobility part of your strategy? Off course, we are deploying apps! How do you plan to differentiate? We are looking at global trends! Do more of the same, do it a little differently; will it change the world or bring around a revolution? As the Q&A progressed, the audience became restless wanting to be rid of the listless conversation. One anonymous listener shouted across the room, “Get off the stage, you…!”
Titles aside the general enthusiasm around digital everything ranged from wearable technology to esoteric business cases; the general feeling was that if you are a migrant, there’s a generation gap, if you are older, why are you here? You don’t understand our language; you don’t belong to this new wave. Don’t slow us down; we know where we are going. While some oldies tried to moderate the irrational exuberance reminiscent of the dotcom era, the young believers retaliated with cries of frustration with the dinosaurs.
I think that giving some latitude to sprouting innovation connect to real life use cases is the need of the hour. It would serve the well-wishers to espouse the cause while staying out of the way of the emerging digital tsunami. The velocity and variety of change challenges legacy thinking; to understand and appreciate the thinking process of the new generation entrepreneurs requires unlearning and new mindset failing which the older generation and some from the current too run the risk of being alienated or being labeled Digital Morons.
In the beginning of the year CIO surveys depicted an upbeat mood with redefined priorities, business bouncing back, economic situation getting better and last but not the least IT budgets going up. This was the global optimistic view portrayed and shared by many CIOs that I spoke to also; and everyone wanted to break into a spring dance and celebrate the return of the good old days. Few CIOs enthused about significant increases in their budgets not betraying the fact that they had the benefit of a low base; 100% increase in budget sounds better!
Every organization big or small goes through an annual operating planning of budgeting revenue and expenses. All CXOs play the game with their promoters, headquarters, Board and whosoever is the negotiating and approving authority. Revenues are understated, expenses inflated and the commentary is all about how tough the environment is while we need to invest for the future. Projects get labeled strategic in their quest for approval; expenses become unavoidable, while market conditions constraint growth which is linked to past mediocre performance.
The situation predictably repeats itself annually like clockwork with an element of distrust on either side built out of past experiences. There is an air of wasteful irresponsible spending that needs parental control which needs to be exercised by the approvers. Chastising the minions, the numbers are adjusted amidst protests to reluctant acceptance. If the normalization has been prudent, life releases the brakes and moves the organization into top gear; when the negotiation is unrealistic, then starts the frustrating process of out of budget approvals.
So when I met a large number of CIOs on the unveiling of one such report, I tried to validate if budgets had really gone up; majority in the room had participated in the survey which brought exuberance to the sponsors and vendors in the room as the details unfolded. The dipstick brought in mixed results, the percentage was lower but there was indeed a group which had seen an increase in their budget. The quantum of increase was also a bit lower than illustrated in the report with a higher inclination towards variability.
Deeper analysis revealed increases factored in inflation apart from business expansion or higher levels of dependence on IT with newer technologies taking up a lions’ share. Business As usual (BAU) spends is under pressure and requires rethinking; there is an expectation of lean thinking but willingness to spend for innovation and quantifiable business value. CIOs are engaging the rest of the company in prioritizing the allocation of funds and challenging status quo. The number of non-participative CIOs is dwindling and that is good news.
I did not hear much about the earlier big discussion on open source towards cost reduction; open source is now a viable alternative for some technology stacks. Expectations of free software reducing costs have withered away with experience of engaging teams to sustain such solutions which require a little more effort, specialized skills and lenient service level agreements. In specific segments the uptake was large and benefit quite visible. The push towards open source personal productivity tools has taken a back seat.
Everyone likes good news! And budgets going up after a while is indeed good news for everyone. The moot question is how much of this will be discretionary to the CIO, or will the strings be pulled by the business? The shift of project budgets to business has been gradual but consistent; the perception of lack of control has created many conversations fueling the insecurity of some CIOs. Though rarely observed now, it is also a check on some not to run away with technology ignoring the best interests of business.
CIOs with strong business connect will continue to innovate and create enterprise value with whatever budgets get thrown at them as they have already aligned the business to what is required and in almost all cases they do end up getting what they wanted. CIOs with patronage of a board member may in the short-term get endorsement, but will be under pressure to deliver more than the first set which is business aligned. So if you have an increase, either way, live with the good fortune of funds availability until the mirage lasts.