June 5, 2012 7:26 AM
Posted by: Arun Gupta
, CXO relationships
The relationship between the CIO and the CFO has been discussed with adversarial undercurrents as the general perception about the CFO portrays a beanie counter. This is analogous to the CIO remaining the EDP Manager, but the prototype has stayed stuck; in a similar vein where the belief continues that the CIO has not evolved and is still the Chief Technician who fixes Boardroom projectors and the Boss’s email.
Recent time, with the resurgence of social media, has seen the emergence of another debate about the CMO cornering a large proportion of the IT budget. This news which could be based on some data points in a survey in a small geography for a sub-segment of a domain, the conclusions depict the CMO usurping the CIO chair; a real stretch of imagination, but which has a group of CIOs vehemently opposing this purported trend. Some discussion groups even want the CIOs to confront their respective CMOs and assert their power over the IT budget.
The CEO factor examined
So when I had an opportunity to partake in a CEO get together, I was looking forward to clarifying a few assumptions and doubts. If you are wondering what this has got to do with the CFO and the CMO, well along with the CIO, they all typically report to the CEO who is expected to mediate in case there is a conflict within his team. The above presumed conflicts will sooner or later end up for arbitration or follow the general trend where the CIO backs off.
I love interacting with CEOs (including my own CEO); they are the better barometer of IT progress and use within their company than the CIO is. As the primary leader of the enterprise, s/he sets the behavioral norms and culture of the company. Their belief system percolates down the spine of the company influencing processes, process discipline, technology deployment and use, risk behavior and finally the cohesiveness of the Executive Committee that runs the company.
Since I knew most of their CIOs it was easy to create correlations: big manufacturing CEO used social media extensively, his CIO is well known for success; mid-pharma CEO who thought of IT as a cost center had high attrition in IT; a diversified group’s young digital native CEO had the CIO soaring high from success to success. You get the trend; the CEO is the lead indicator of how the job of the CIO is likely to be in a company and where s/he will stand in case of a conflict with other CXOs.
The reporting structure
If you benchmark companies with CIO reporting to CEO versus other CXOs, the comparison set clearly demonstrates the ones with the CEO fare better even when the CEO is not necessarily IT friendly. In the control group which ranges from 30-80% (CIOs reporting to CEO) depending on the geography and industry, the next differentiating factor is the CEOs appreciation, tolerance, averseness or indifference to IT. It is evident that the CIO directly or indirectly influences the success of the CIO.
Should the CIO be insecure about the span of control, budget, or technology disruptions? Most CIOs aren’t but the hype created by various factions would make you believe that the CIO is shivering with fear uncertainty and doubt (FUD factor) on his/her future. Reality being diametrically opposite, I believe that CIOs should stop reacting to rumors and instead start proactive communication on the contributions to different parts of the enterprise in making the CMO or the CFO successful. Let them be at the receiving end for a change!
May 29, 2012 12:01 AM
Posted by: Arun Gupta
, CXO relationships
, Meeting customers
A recent edit in an IT publication discussed the pitfalls of the CIO going out on the field meeting the end customers of the company’s products or services. It highlighted the fact that most CXOs wanted the CIO to stay away from the customers and not encroach on their territory. The CIO meeting customers was seen as disruptive and a threat to their relationship and the final moment of truth with the consumer. This observation was believed to be consistent across industries as well as size of the company.
A call to the Editor resulted in her portraying the reality she had witnessed on the discussion table that included some heavy weight CIOs. They were tentative in their approach to reaching out to customers; this was not viewed kindly with heavy brick-walling. A casual interaction was fine, but not continued engagement that may result in a different reality for the sales / marketing teams. Of course, there were a few outlier CIOs who did systemically meet the customers and shared insights with their teams.
My reality being different from the majority, I decided to chat up with some CXOs to determine if reality was indeed that grim. I picked a few high-touch industries like retail, banking and airlines, and added some low touch ones like pharmaceuticals and FMCG where the end consumer is largely faceless. Then I started searching through the good old visiting card rolodex, my connections on social media and professional networking sites; finally adding some with help from industry bodies.
I had some apprehension if I will get candid responses, so I decided to use the research envelope which does normally get open answers; you know researchers are perceived as non-threatening since in a statistical model, there is no identity. The modus operandi worked well and my research was successful in capturing reality with high fidelity. The correlation to industry or size of company was not decisive, the general trend was however quite evident.
Marketing and Sales have over the last few years faced uncertainty due to the global economic uncertainty and the impact it has had on consumer sentiment. Corporate as well as individual spending has seen a general holding back. Do we really need to spend? Do I really need the latest gadget? Such decision points have resulted in pressure that has everyone looking inward more than outward. Natural reaction has been to hold on to the fragile relationships. What if the discussion turned away the customer? What do you know about customers anyway?
Mr CIO, you have no business to …!
One of them quite paranoid went on to state that IT has no business prying into relationships; he had advised his team to keep everyone at bay like the pirates; auditors, information security, anyone who asked for data was turned away. Even the BI reporting was curtailed lest it be used by someone to create different conclusions. The company in question was struggling for growth though doing better than some of their competitors. In the high growth era, they were the leaders, now that appeared to be chapters in a history textbook.
Can the CIO change this behavior? Being an optimist, I would say, probably yes! Is it worth the effort? Many would say, certainly not! And I tend to agree with the collective wisdom though with a caveat. I believe that CIOs are always at the short end of disruption; so they should not back off in the face of this push back but continue the dialogue while getting others behind the cause. Different perspectives have always created new opportunities. After all, you cannot expect different results if you continued doing the same thing over and over again. I have lived by this maxim and I am still alive.
May 22, 2012 12:01 AM
Posted by: Arun Gupta
The IT industry has many types of vendors; some focusing on niche solutions, some specializing in specific technologies or domains, some who offer a menu of products / services ranging from infrastructure to applications, and then there are large diversified companies who do everything from consulting to implementation of technology solutions or packages backed by support services in a local, offshore or multi-location model. The big guys manage all kinds of requirements and bring to the discussion table a comprehensive long-term engagement model.
Different vendors set different expectations on what they can deliver; the niche providers do not promise a breadth of services, they stay focused on their expertise. The big ones claim to have expertise across the legacy to contemporary and cutting edge; they have industry practices and business consultants who profess incremental to transformational change capabilities. You name it we can do it; even if you cannot put a name to it, we will find a way to do it!
Complexities in governance
The large one-stop-shop engagements typically begin with setting of scope and expectations on delivery, timelines, and quality of service, rewards, penalties, force majeure, arbitration, cost, escalations and a lot more. The larger the scope, or the longer the time period of the contract, the governance becomes complex. We know that Total or Strategic outsourcing can cover everything; in recent times though the number of such deals has been dwindling.
So it was an interesting debate when a few CEOs on a panel berated the one-stop-shop companies giving it a new twist. Consider you wanting to reach a far-far away destination and the only option is to go by bus. Every bus gets you there, some are slower than others, some offer many comforts through the journey; the cheaper ones just get you there. Depending on what you can afford, there are many options to choose from. Caveat is once you have bought a ticket, a change is difficult and painful.
When someone advertises ‘one-stop-shop’, the conventional understanding is that I get from where I am to the final destination with no stops with the advertised and agreed comfort. Reality as we know is not always as advertised. A CEO remarked on his journey with one of the global biggies; he signed up for a long journey wanting to focus on his business. Very quickly he was on the discussion table with the bus driver, conductor and the entire fleet management company.
Why is my journey so excruciatingly slow? Why is the transformation promised not happening? When will I see any impact to my employees, stakeholders, customers, or for that matter any efficiency to business operations? Whatever happened to the pre-sales promises made by the various function heads of your company on various domains and technologies? Pat came the answer, “we are a one-stop-shop company; we go one stop at a time. This is what we promised; we did have a driver change and a breakdown; that is part of the contract. We meet defined service levels.”
Devil lies in the detail
Both are right in their frame of reference; so where is the problem? I believe that any such engagement should have common definition of reference points with clear understanding of step-by-step process, impact and governance. Otherwise the semantics of the one-stop-shop can be painful for everyone involved, the deliverer and the recipient. The bus is still moving but not in the way that makes the journey a pleasure. CIOs will be at the receiving end if there are such gaps.
May 15, 2012 12:01 AM
Posted by: Arun Gupta
Changing role of the CIO
Almost a decade back I remember a company that after spending a large amount of money with consultants going through the whole nine yards and then some more recommended rechristening the IT department as Business Technology. It was a move driven out of the aspiration to stay ahead of the crowd and differentiate. The BT group was different from Corporate IT and a few other IT groups within the enterprise; they were the elite. This was in the era when IT was just beginning to gain acceptance.
This large and diversified company was written about; the bold move spawned research papers and everyone acknowledged that the future belonged to Business Technology. Slowly over a period of time the internal customers of this group started asking the question, old wine in a new bottle still tastes the same; where is the change in attitude, delivery, partnership, innovation, all the good stuff that was promised and expected. Whatever happened to the Vision and Mission? Interestingly the leader retained the title of CIO and not CBTO. Maybe she did not want to tell a story.
Twist in the tale
Then I met another IT leader of a successful company who gave me a twist in the story. He had named his function STT. With me lost trying to decipher the TLA (three-letter acronym), he proudly unveiled the mystery with the logic: we create solutions; they are a lot more than hardware, software and networks. However whatever we do has a common underlying Technology framework. Solutions are holistic and do not constrain the thinking process. So our team is aptly known as Solutions & Technology Team. Ahem! Many years later the poor chap is lost in wilderness; he stressed more on the middle T than the first S.
In recent times there have been many discussions and debates on the changing role of the IT leader; some of them concluded with recommendations that the title CIO is no longer relevant and the role as it stands today will no longer exist in the next XX years (fill in whatever number you like). So, the name should be changed to reflect the new reality. Suggestions cover the entire alphabet soup with rationale based on not the CIO but the proposer’s frame of reference.
What’s in a name?
Does it matter what the function is called? Do semantics make a difference? Will the reality be different for the involved stakeholders depending on the nomenclature? How much does the name contribute to reality and success? Can an IT department transform itself with a new name? Is a change required with every changing technology trend and business evolution (would you like to be called Chief Cloud Officer)? I am not proposing going back to the historical EDP, but IT today represents to a large extent the sum of the parts that make us.
Success is a result of great attitude and not the other way around; I believe that individuals and leaders portray themselves based on past track record and the engagement that they are able to create. The IT team collectively mimics the behavior of the leader. This paradigm is true for all functions and no different for IT. CIOs should stop getting distracted by these irrational and irrelevant thoughts and focus on what matters to them, their teams, their customers (internal), and their customer’s customers (external). After all the best measure of success is success itself.
May 8, 2012 12:01 AM
Posted by: Arun Gupta
, software licenses
, Vendor relationships
Last year was a very difficult year for most software companies with slowdown in new license sales that brought in a negative trend in new business revenue. This happened very quickly after the globally experienced slowdown a few years back compounding the issue. This had all software vendors almost like acting in unison deciding to engage their existing customers in license audits. If you cannot get new revenues, let’s squeeze some juice out of existing lemons.
So these engagements began to look all over the place; the data centers, servers hidden under tables, desktops converted to servers for a simple test or proof of concept, users created though inactive, resigned employees not deactivated, it did not matter what the event was, if there was a user identity or a database, or an instance of the application, it needed to be licensed. Office automation and other fringe app vendors joined the fray and added to the already harried CIOs’ blood pressure.
No debate that license compliance is non-negotiable; licenses for software or product or package used for the enterprise that in any way impacts a business process. Most vendors allow disaster recovery to be set up at nominal or no extra investment as long as it is not used conjointly with the production environment. That looks like a good principle though some complicate matters based on number of days used even when the primary was down and not operational.
The ways of the vendors
Some also allow test and development instances to be set up; interestingly, most do have a licencing policy that charges the customer, however, most sales teams shy away from highlighting this fact during the pre-sales discussions or even when the purchase order is received. Instead, they give the CIO a fine printed legal document to sign without pointing out to the salient points that the customer needs to be aware of. I don’t know of CIOs who read those wonderful documents; it’s like pressing “I accept” when we enrol to a new website or app.
So far still so good as each instance expects the customer to get into an engagement with eyes and ears open; the principle being we gave you the full documents, you read and sign or you don’t read and sign, that is a choice. The discussion gets interesting when new or additional licenses are required even if a line of code is changed or added to any screen, form or report or an add-on deployed. This now attracts additional investment, sometimes a lot more than bargained for. Now that is hitting below the belt!
Killing with the fine print
If I may add, the same vendors participate during the pre-sales gap analysis and bid and quote for customizations through their consulting arms vying for implementation business. But no mention that if the customer did end up customizing, then … This aspect of licencing is rarely discussed if at all and mostly comes up during license audits leaving the CIO gasping for life. The management demands that the CIO know all this as it is his/ her job to know and manage the vendor.
Page number XX, clause YY, sub-clause ZZ in the sales agreement is cited as the reference for the new demand. Read it and if you can figure it out differently let us know; else here is the bill of material and the timeline in which you need to buy. Consequences you know are not something you want to talk about. Sheepish acceptance and wows to be more careful and read all the fine print is normal behavior; the management takes a not-so-kind view but goes ahead with the devil’s choice.
A global issue?
Why does this charade repeat itself globally with many vendors, some more than others? It does not matter which industry, which country or geography, size of the customer (in fact the bigger the better as they are averse to the publicity it draws), this is becoming one of the relationship breakers between the impacted CIO and the vendor. Stories of these are rarely published by publicity shy individuals and enterprises. Is there a way out?
I believe there isn’t an easy way out; negotiating from a compromised position does not get any great deals; neither does it do wonders to CIOs’ careers. Whether they like it or not, CIOs have to get more diligent in their approach to legalese and contracting. As the markets saturate and mature, read changes to changing end user contracts and / or licensing terms. You never know what impact it has on your company.
May 1, 2012 12:01 AM
Posted by: Arun Gupta
, Time management
I was recently reading a survey on how CIOs divide their time between activities; internal customers, external customers, vendors, management and business meetings, staff review meetings, fighting fires, responding to emails, learning new technologies, and attending a host of IT events. CIOs are a busy lot, they have to balance all this with some time also to be allotted to their families.
So I started talking to a few CIO friends to understand what keeps them busy through the day. It was an interesting revelation; the CIO keeps business running as usual, the networks, the servers in the data center, distributed architecture in many cases, information security, and plethora of applications that keep the business alive, new projects that business wants and some that the CIO feels are necessary even when business does not care. There are, of course, the urgent yet sparsely defined requirements for changes, the IT team and finally the IT vendors.
I am not even getting into new trends that promise disruption to the existing landscape; the flavor changes frequently. Not in any particular order they have been the Internet, Business Intelligence and Data Warehousing, Mobile Computing, Thin Clients, Work anywhere, Cloud Computing, Social Media, Big Data, Virtualization, Advanced Persistent Threats, Mobile Commerce, ad infinitum. Educating and managing expectations across all the hype along with running IT operations; all in a day’s work!
So one of the pet peeves that I heard is that there is no time for any discretionary work, little time to sit back and think about the strategic direction IT should be taking, no time to engage with other CXOs and end customers to work on the innovation agenda, no time to mentor/ coach the team which looks up to the CIO for direction, no time to educate self on what could be the next disruption to their business. No time for the stuff that they enjoy.
Are CIOs any different from other CXOs who also have to balance variety of similar but dissimilar tasks? Every leader within the enterprise has to stay abreast with the industry, the economy and how it impacts the company’s market position; what interventions will make a difference. At the same time they are expected to manage internal and external perceptions while leading and managing the team to create success. Successful CIOs I know do this every day.
A very large conglomerate’s CEO abhors the lack of time cited by every busy executive; his group of companies are well respected for their market leadership and value creation. Almost everyone in his companies leaves the workplace before the sun sets. His mantra? If you cannot complete your work within the stipulated time, then either you are incapable, inefficient, or your manager/ boss does not know how to allot and divide work within the team.
In many companies, busyness is also a well fueled perception; culturally these companies encourage activity and spending time beyond working hours. It then becomes a race to be seen late evenings and even nights to say I was busy; don’t leave before the boss is a way of life. Perpetual state of motion does not guarantee outcomes. Don’t tell me how hard you work; tell me how much you get done. I have lived by this maxim and it has worked for me.
I believe that every leader including the CIO needs to empower, delegate and let go of tasks and focus on outcomes. In the end what matters are results! Manage time and don’t live by the clock. Prioritize the important and the urgent based on the impact. Your becoming indispensable to the company is bad for you and the company. It will stunt your growth opportunities and also give you no time.
April 24, 2012 12:01 AM
Posted by: Arun Gupta
, Changing role of the CIO
, IT budget
I liked the rhyme in the words as I read the headline; it is poetic in a way and in contrast many research companies that are telling us, the CIOs, that one of your top five priorities is to save cost. I still cannot figure out who collates the results and what kind of solutions they use to determine the results, there has always been an outlier that no one agrees with; this includes many who participated in the survey. So when I saw the news about business wanting to spend on IT, it was like an oasis and the heart wished it was real and not a mirage. After all, many businesses I know have been investing extensively.
Over the years we have been hearing the maxim, “Do more with less”, almost to the extent that it has become “the normal”. I cannot remember a year when the CEO and/or CFO did not repeat the phrase chiding the proposed budget for being irresponsible. The banter is part of the negotiation between the CIO and the custodians of profitability. The underlying assumption was and now in some cases still is that CIOs are far removed from reality and they leave stuff like profitability and ratios to other CXOs.
Reading through the lines it was evident that the data points that went into the writers’ hypothesis were of strong foundation. She had industry slices and geographical splits with numbers that were plausible. Interviews with stakeholders validated her statistical inferences citing willingness to invest in IT solutions that provide market advantage or capability needed for growth or to stay where they were. Melodious music to ears with slowly creeping nagging cynicism; if it is too good to be true, then probably …
So I dug deeper, followed the links, unearthing the evidence that has continued to elude respectable research companies professing the contrary, save or die. Having got conditioned to a message, it was hard to believe that there someone has been brave to talk about reality the way it is. The sample size more than adequate to withstand scrutiny, the data irrefutable; some may wonder if she connected with CIOs and CEOs from another planet?
The conclusion was associated with a reasonable set, there were many who still lived in the old world of cost. Progression of CEOs showed IT investment trend line going north. The winners subset depicted converging thoughts between CEO, CFO and CIO, the bulging middle some alignment, and the laggards a big divide. The number of believers in IT is growing and they are happy to talk about their success. The author had decided to focus on good news with a positive bias that was growing than the statistically larger group which is shrinking, albeit slowly. Hallelujah!
We all live under the same sky but have different horizons. Over the last decade and more across industries surviving a roller-coaster economy, many CIOs have been able to create a perceptible shift in thinking wherever they go. These are the business savvy, technology aware, articulate and confident set of CIOs who bring success like the Midas touch (if you prefer a more contemporary analogy, I would compare them to X-Men). The tribe of these outliers is increasing; shortly they will be the majority and it is evident they will shape the future.
Are you a part of this assertive movement? Come join the joyride!
April 17, 2012 6:04 AM
Posted by: Arun Gupta
, Oh I See moment
, Shadow IT
It was a conference of supply chain heads who had gathered to discuss and debate their collective future. The themes revolved around agility, efficiency, constraints and opportunities; all in a day’s work for a CSCO or a Chief Supply Chain Officer. I was invited to talk about IT lead supply chain innovation and why CSCOs need to partner with their CIO to be successful. It was a good feeling that other functions are looking at IT and their CIO to help them win.
The conference agenda was similar to what CIOs typically see in an IT event; a few vendor sponsors who want to sell their wares, in this case warehouse automation solutions; select IT vendors pitched in to discuss Warehouse Management and Transport Management Systems. Then there were a couple of luminaries from the supply chain world who were looked upon as beacons of success to share their winning formula. And finally a few odd men like me not from the domain to talk about collaboration and synergistic success.
The half-day ended quickly enough, which happens when you are having fun, with the evening transitioning into an informal gathering of the speakers and the participants. CSCOs are a smart lot who know what they are doing and how to get there. They also acknowledge internal and external dependencies that aid or curb their success. IT is one of the key tenets to their capability to execute; thus there were a lot of questions to probe how CIOs perceive the partnership.
A mixed bag
We all know that most CIOs are always willing to partner with other CXOs to create change; when there is equal or more commitment from the other side, it is a recipe for a winning team and results that matter. As the discussion unfolded, I heard some good stories and some filled with angst and agony. A mixed bag if there was one with fingers pointing in all directions. So I started digging deeper.
A CSCO began narrating his journey towards creating improvements in warehouse processes with some IT enabled automation; the journey took twice as long as promised and thrice as long as expected. He also talked about his struggle in getting his CIO to agree to evaluate a warehouse management system. The CIO kept throwing back questions and never took the steps forward to understand the challenges on the ground. He had almost given up his quest to use IT for competitive differentiation and then budget not being a constraint started creating shadow IT organization to fulfill his need.
Another one talked about his CIO being the best partner creating quick and dirty solutions to solve every business challenge despite budget constraints; he praised the IT team’s pragmatism and alliance with the supply chain team and warehouse managers to improve inventory turns and reduce labor required. Analyzing the situation with some additional questions, it was evident that the two CIOs approached the opportunity differently.
Apart from everything else that includes alignment, business understanding, etc. that everyone talks about as qualities that a CIO should imbibe, the risk-taking ability of the CIO has direct correlation to how often s/he is able to create a ‘WOW!’ moment. Everything safe equals no risk; and no risk also means that innovation takes a backseat. As long as the CIO plays safe, s/he is bound to slip on everyone’s perception. Business will find a way to overcome; the CIO can decide to be a part of it or will sooner or later find him/herself relegated to the background.
I believe that CIOs should give up inertia and work on their risk ability to stay successful. I close with a collectible quote from Keith Johnstone: Those who say ‘yes’ are rewarded by the adventures they have. Those who say ‘no’ are rewarded by the safety they attain.
April 10, 2012 12:01 AM
Posted by: Arun Gupta
I don’t know how I stumbled across this blog and hundreds of comments but it had me thinking with a gaping and wide open mouth. Not that the scenario I read about does not play itself ever so often in the corporate circles; it was an open discussion on strategies to entrap the CIO to meet the next target, to close a deal, to shorten the sales cycle. There were experiences shared, discussed, fortunately no names mentioned of the vendors or the CIOs. I did pick up some good recommendations on fine dining though.
Balance of power
Trappings of power bring with it responsibility; with large budgets and the ability to decide in favor of one against the other, the CIO sits in a position where every vendor, big or small, attempts to find the winning formula to gain a good book and business. The exalted chair is expected to make a fair decision (the loser may think otherwise) to award business to the deserving and not be swayed by the drama or influenced by ill means. CIOs I know across this globe practice unshakeable integrity in decision making.
From time immemorial, those wielding financial power have been sought after for favors. In the old days, after the technical evaluation, the purchase executive could turn down a decision and no one could challenge that. The power of veto was a feared weapon. Over time driven by trust and increasing penetration of IT, a shift occurred with the CIO empowered to work independently. Economic cycles shifted the decision making to where the monies lie, and the elastic nature swinging it back and forth to equilibrium quickly.
Queasy means, easy deals
So as I read through post after post, it was an uneasy feeling to see tips and trick that have worked to snare a deal. Golf course priority bookings, tickets to matches, free vacations, gourmet dining, you name it, they had tried it. Some more than others, they found what works for whom not leaving many who resisted all temptation. Feeling queasy about this, I called a few old colleagues to chat and discussing this with them, one toppled my wine by adding anecdotes of his own.
Are decisions so easily facilitated with the lineage and vintage of wine determining the steps and time required to close the deal? Is this working at the conscious level or the sub-conscious even when there is no coercion? Is it wider in its reach and influence than we believe it to be? Are we becoming slaves to a system without realizing it? Or have we become immune to the system and now factor it into our decision making criteria?
The CIO insights?
I love my red wine and some good food to go with it; I have enjoyed many evenings out with friends and family. Occasionally vendors seek relaxed meetings “outside of workplace”; I know many have been careful to take a few colleagues along for comfort and keep the meeting a strict business one. It keeps the discussions easier and the environment lighter with no obligations being created on either side. A few CIOs also pick up the tab rather than leave even an iota of doubt. I would assume that each vendor would have classified data on what works and what does not for every tagged CIO.
The play now is universal; every vendor uses some leverage or other to go beyond the normal decision making cycle. Direct or indirect, these influences are here to stay as long as there are multiple vendors offering similar solutions or products. Wine and dine is part of corporate culture, the CIO and for that matter other CXOs have to work the fine line between undue influence and socially acceptable behavior keeping their personal and corporate values above everything else.