Using IT spend as a percentage of revenue to figure out how to divvy up IT investments doesn’t work in many large companies. For one, most enterprises have varied business units and goals. One business unit might be in fast-growth mode and require more tech spending; another might be mature and held to a lower IT spend; and yet another might be going through a transformation project that requires a different spend. So picking a standard IT spend as a percentage of revenue for all of those units isn’t going to cut it.
And this pigeonhole of a metric certainly doesn’t reflect the ever-evolving and growing importance of IT investments in relation to a company’s ability to grow and compete. The run, grow, transform (RGT) model may be a better approach.
Read my CIO Matters column to see why Richard Hunter, vice president and Gartner fellow, recommends using a RGT model (and other more forward-looking metrics) for allocating IT spend, and learn about the real-life challenges CIOs encounter when using said RGT model.
At long last, we’ve successfully traversed the drudgeries of late winter and early spring and are poised to embrace those most rejuvenating unofficial first days of summer, otherwise known as Memorial Day weekend. Can you tell we’ve been looking forward to this?
As you reflect and relax with family and friends this weekend, we hope you’ll spend a little time with this week’s roundup. We kick it off with bits from the social media realm, including why your CEO is hurting the company if he/she isn’t living a rich social media life; a few reasons why Facebook had a thumbs-down kind of week; and why social media and silos don’t mix. Finally, we hope you’ll take a few moments to help out with important research at The CIO Leadership Institute by taking their survey on social media.
- Funny, he seems so bubbly at the company meeting. Forbes looks into a recent IBM study that claims a CEO’s lack of a social media life may be to the detriment of the company.
- Unless you count the release of its rather Instagram-y camera app, Facebook had a pretty crummy week. Blogger Nigel Cameron offers up three simple reasons no one seems to want to be in a relationship with FB since its IPO.
- It’s called social media for a reason – keeping it siloed is against its nature (oh, and a waste of money).
- What happened in Utah could happen anywhere, a simple little mistake cost millions of dollars, scores of data and a CIO’s job — so what can we learn from the little big breach?
- Still on the fence about bring-your-own-device, or BYOD? Ugh, just do it all ready, says Mashable, rolling its eyes and handing you these five easy steps to BYOD transformation.
- It’s a long weekend, so we know you have the time to take this survey from The CIO Leadership Institute — you can use the hand not holding the hot dog to tap the screen or click the mouse. Thank you!
A pair of winners was selected for this year’s MIT Sloan CIO Symposium Award for Innovation Leadership. Sharing the honor, announced this week at the 9th annual symposium, are Catherine Bruno, vice president and CIO of nonprofit Eastern Maine Healthcare Systems (EMHS), and Chris Perretta, executive vice president and CIO at State Street Corp.
The award honors CIOs who lead their organizations to pursue IT innovation and business processes that deliver business value. SearchCIO.com congratulates the winners and invites readers to dive a little deeper into what makes them leaders in information technology innovation. Perretta recently recorded a podcast with our Senior News Writer Linda Tucci about building a private cloud at State Street. And we hope you’ll stay tuned for a soon-to-be-released exclusive video interview with Bruno.
In her roles at EMHS, Bruno successfully developed information systems strategic plans and governance designs at three large health care organizations. She has implemented and integrated major clinical, financial and decision-support information systems, two of which received the Nicholas R. Davies Organizational Award, the nation’s highest award for implementation of a system-wide electronic health record. She is the executive sponsor for the Bangor Beacon Community and co-chair for the Leadership and Governance Community of Practice for the national Beacon Community program.
Bruno said being a CIO is about bringing out the best in those you work with, adding that the award also honors those she collaborates with in delivering health care services in Maine.
Chris Perretta has global responsibility for State Street’s IT activities, leading a team of more than 5,000 IT professionals in 29 countries. He oversees the IT strategic planning process, application development and maintenance, system architecture, global technology infrastructure and information security for the firm. Perretta is also the co-leader of State Street’s Operations and Information Technology Transformation initiative.
Perretta said the award is a great honor that underscores his organization’s ongoing work and commitment to using technology to deliver innovative solutions to their clients.
In a statement, award program co-chair Ray Chang said judges were pleased to recognize both Bruno and Perretta “for their strategic use of technology to significantly impact and improve business performance for their respective organizations.”
Chang noted that both serve as prime examples of how technology can drive business success and the important role of CIOs in organizations worldwide.
What would the CIO role be without all the hand-wringing over whether it will survive another minute? This week was the annual MIT Sloan CIO Symposium, “Piloting the Untethered Enterprise,” a one-day conference so crammed with provocation, bon mots, covert deal making and rubbernecking (who is that ready-for-TV techie in the next seat?) to make one’s head spin.
Of the sessions I was able to attend, the boldest one was the MIT academic panel, followed by an after lunch free-for-all on big data and analytics that was anything but a siesta. (Look for a piece soon on why CIOs might want to run away from big data.) The three MIT academicians who gave their take on the untethered enterprise are professors, but not exactly of the Mr. Chips variety — beacons of calm in the midst of unimaginable change. They were more like bomb -throwers, invoking all the forces — consumerization of IT, cloud, crowdsourcing, social networking, the voice of the customer, — that are blowing up the enterprise as we know it. In this brave new enterprise, agility trumps strategy and resilience trumps strength. Today, customers should be serving the company (think Facebook’s 800 million users generating content).
I was entranced. As I wrote in my CIO Matters column this week, however, I was also leery of — OK, confused by — how all this will impact the CIO’s role. There was some talk about how pruning and curating will be important as companies try out new things willy willy-nilly, so maybe the CIO role will be defined as master gardener. One of the profs mentioned a childhood friend now at eBay who does nothing but figure out the “checks and balances” between buyers and sellers. So maybe the CIO’s role will be akin to Founding Father. As someone who has done my fair share of time in the kitchen, I would only urge CIOs that the one metaphor you don’t want to embrace in this latest computing revolution is doing the dishes. Check out the column and you’ll understand.
CEOs — just who do they think CIOs are? Who do they want you to be?
Mobile may be on your mind. Perhaps you have your head in the cloud. That’s all well, good and important to the CEO, as long as you can show you’re adding value to the business and creating competitive advantage.
The theme of MIT Sloan’s 9th Annual CIO Symposium, held Tuesday in Cambridge, Mass., was “Piloting the Untethered Enterprise.” But the strong message coming from a panel of CEOs to CIOs was to make sure you’re firmly entrenched in the business — and all the better if that spot is between the business and the consumer. And, oh yes, that magical word everyone likes to invoke — innovation — came up a lot in association with the CEO’s preferred CIO.
It’s crucial that CIOs have a firm handle on new technologies and delivery systems. Object Management Group Inc. chairman and CEO Richard Soley pointed out that, as enterprises transition into this untethered age, the CIO has to be there to solve all the standard problems — security, for example — for the new wave. But if IT leaders stop there, so might their careers.
“What’s important is, are they involved in the CXO suite’s informal discussions and where the company is going strategically? And are they part of the decision of where the company is going strategically?” Soley said, adding that he likes the idea of CIO standing for chief innovation officer. “Standards are the basis for innovation, and that’s the opportunity for the CIO: to bring in standards both global and local and make changes to the organization.”
Jeffrey Markley, CEO at Boston-based Markley Group Inc., drew a comparison between the CIO and another C-suite member: the CFO. If a CFO functions as “just an accountant,” what does that do for the business? He’s doing his job, a job that needs to be done, but adds no unique value. What CIOs do is critical, but if they stick to the strict definition of the role, they’re going nowhere.
“It’s really up to the individual. We know people in this room who’ve gone from CIOs to chief innovation officers, people who are making changes in the organization,” Markley said. “I want to surround myself with brilliant people who are going to make our company stronger, better and get us into new opportunities and make our customers grow and be happy and want to do business with us.”
Scott Griffith, chairman and CEO at Zipcar Inc., based in Cambridge, Mass., got specific with his expectations. He used his own company as an example of why it’s imperative for the CIO or IT leader to have a seat at the C-suite table. With big-name rental companies Hertz and Avis poised to assert themselves in Zipcar’s business space, information is Zipcar’s biggest weapon in keeping its competitive advantage.
“We know more about our customer than anybody that’s going to enter this business. We did 4 million reservations last year, and shame on us if we didn’t mine all of the information out of those reservations and figure out how to become a better company and drive a better experience and be more profitable,” Griffith said. “Information is integral to all that. [The CIO role is] a seat-at-the-table job, and every company should be picking that up. The top information job is going to be more strategic.”
Unless you’ve been living in outer space (or on MySpace), it’s impossible not to know that today is the day Facebook drops its privacy settings and friends the NASDAQ. News and analysis abound, but we think we’ve picked up a couple of more interesting tidbits on the whole big deal. And, if you’ve got Facebook fatigue, we also bring you some serious stuff about Security and Exchange Commission (SEC) guidance on cybersecurity and not-so-serious stuff about how an app becomes a star. Hope you “like” it.
There are plenty of opinions on what the Facebook IPO will mean for the company’s employees and investors (bigger planes? personal islands?), but this story suggests it could also benefit the data center industry.
Facebook’s tentacles — um, arms — reach every corner of the globe, but who embraces it most? Statistics show Brazil and Bangkok are major fans, but the U.S. still “likes” it best.
And now, for something completely different, and a lot more serious: security. Blogger Richard Bejtlich’s take on why SEC guidance on cybersecurity is “a really big deal.”
Have you ever wondered just how popular an app has to be in order to make it to the top of the app-store heap? Wonder no more. Now if we just had a metric for Tootsie Pops.
And, finally, you think you’ve got big data? That’s not big data — this is big data.
Very bad things happen when security protocols are neglected. Just ask Stephen Fletcher, the now-former CIO for the state of Utah. Fletcher was fired by Gov. Gary Herbert this week over the March data breach that compromised the personal and medical information of about 780,000 Utahns. Two of Fletcher’s former employees are under investigation in connection to mistakes that led to the breach.
Somebody fell asleep at the switch — or server, as it were — allowing hackers in Eastern Europe to slip right into the state’s Medicaid database. They slipped out with hundreds of thousands of birthdates, names, addresses and social security numbers, among other useful tidbits. It’s believed that, by exploiting an unchanged default password on the user-authentication layer of the system, they were able to bypass multiple layers of security controls. Yes, a default password cost at least one person his job, more than half a million people their privacy and millions in taxpayer dollars to clean up the mess.
Herbert said he sought the CIO’s resignation because Fletcher lacked “oversight and leadership.” Ouch. Maybe this wouldn’t sound so bad if, as several accounts suggest, Fletcher weren’t so good. Since he was named the state’s CIO in 2005, Utah has emerged as a leader in government tech and innovation, and Fletcher has been credited with leading the state to successful enterprise-wide IT consolidation and centralization. He’s a past president of the National Association of State Chief Information Officers and a past recipient of Government Technology‘s “Top 25 Doers, Dreamers and Drivers” award. But now a default password overshadows all of that.
Fletcher told Government Technology that the incident was preventable and is an example of why more funding is needed to protect government IT systems. In just the past four months, he said, cyberattacks on the state’s technology system have spiked 600%. But Fletcher also bemoaned the fact that this would overshadow all of the good work done by his department — the cost savings, the consolidation, the presence of more than 1,000 online services for residents.
Whether Fletcher is personally at fault is still under investigation, but he certainly has taken the fall. One would hope security protocols at least existed — if not, the blame surely lies at his feet. If they were in place and employees simply didn’t follow them — well, the blame still falls on Fletcher. In the end, he is the leader in this scenario, and unless it can be proved his team members maliciously left the server vulnerable, it’s his job to make sure they do theirs.
Certainly, this is an extreme example of what can go wrong when security protocols are not adhered to (or are possibly nonexistent), but nonetheless one worthy of every CIO’s attention. Handling security and compliance is a balancing act and a team effort. Stories like this one are sobering reminders that, while it isn’t easy, steadfast attention to managing information risk has value beyond measure.
I spoke with a CIO years ago who went around his data center and randomly shut down servers. He did this for two reasons. For starters, if no one noticed that the server was off for a week, it obviously wasn’t needed.
The other, more important reason? He wanted to see how his IT staff reacted.
It’s not simply that they don’t have disaster recovery documentation, but if they do, people can’t understand it.
In one recent instance, a CIO ran through a disaster recovery scenario, and it went off smoothly, thanks to one all-star on the staff who knew how to recover everything off the top of his head.
“I asked, ‘What if he’s sick of on vacation?’” Kirvan said.
His point is that the documentation has to be simple enough and consistent enough for anyone on staff to be able to step in and recover a system — so simple that, even if your IT staff can’t perform the function for some reason, a non-IT person could.
To help get your staff on the same disaster recovery documentation page, Kirvan suggests checking out disaster recovery software, plan templates and guides, a list of which has been compiled by fellow industry expert Phillip Rothstein.
As we head into another weekend, we’d like to send best wishes to our readers who are also mothers. Come to think of it, being a CIO or IT leader is a lot like being a mom: Every day brings new challenges and changes, you’re constantly trying to keep everyone satisfied, sometimes you just have to say “no,” and you’ve got to be vigilant about keeping the “household” budget.
This week’s roundup of tidbits from around the Web touches on a few of those aforementioned changes: in what IT is investing in, in the data center development cycle and in mobile strategies. Still, there are some things that it seems will never change: A floppy disk means “save,” kids. Why? Because we said so.
More proof that your mobile strategy touches pretty much everything you do, and underlining the importance of the CIO’s relationship with the chief marketing officer and the business: Thanks to social media and mobility demands, investment in CRM (customer relationship management) software has jumped from No. 18 to No. 8 in a Gartner Inc. survey of CIO and CEO priorities.
Still not convinced of the importance of a mobile strategy? Even within the slow-grinding gears of government, the call for “mobile first” is gaining traction.
Blogger Greg Ness opines on how the commoditization of network hardware could drive a new data center development cycle.
So, maybe she doesn’t always give you the best directions or particularly accurate weather forecasts. Did you ever think maybe Siri is just meant for a higher calling? Forget the neoprene case — get this lady a lab coat.
It hadn’t occurred to us until we saw this post that, for some computer users, the floppy-disk icon is not “the floppy-disk icon” — it’s “that thing you click on” to save stuff. It says something very interesting about the evolution of culture and language, yes, but mostly it just makes us feel old.
Call it the triumph of consumerism, or just common sense. Mobile computing is on fire in the enterprise — apps, middleware, tablets — and the proof is in the pesos, pounds, the pieces of eight. Mobile is where the money is, reads the headline trumpeting the new Forrester Research 2012 IT spending report published this week. Mobile spending grabs the biggest share of the rather-modest overall 5% budget increases planned by IT in 2012, according to the report:
- 45% of firms plan budget increases of 5% or more on mobile apps and mobile middleware, outpacing business intelligence (43%) and security (40%), the other two top spending priorities. That’s a measurable change from last year’s survey, when between 36% and 39% of firms planned to boost mobile spending on apps and middleware by 5% or more.
- On the hardware side, increased spending on tablets was on the agenda for 44% of firms, just ahead of storage products (43%) and server hardware (41%).
The figures are based on responses from IT executives and technology decision makers at 3,752 enterprise and SMB firms surveyed by Forrester from October to December 2011.
There are other signs that mobile is where CIO minds are at these days. Despite the ongoing hype around cloud, spending on cloud-based services like SaaS, Platform as a Service (PaaS) and Infrastructure as a Service (IaaS) accounts for less than 5% of IT budgets. Full-time IT staff continues to take the biggest chunk of IT budgets (27%).
The report notes that the increased spending on mobile software and hardware is not just about the money. Mobile computing and consumerism signal a major shift away from IT departments as the commanders-in-chief of technology to the rising role employees play in tech decisions. According to the report, 23% of the IT leaders polled said their business groups wanted to be more involved in IT decisions about technology in 2011, compared with just 6% who saw a decrease in business involvement.
Frankly, based on our reporting on mobility and the consumerization of IT over the past two years, that 23% seems low. CIOs like Rick Roy, just to name but one of the mobile pioneers profiled in our CIO Innovator series, caught the shift early. His meticulously plotted strategy to mobilize CUNA Mutual Group included developing 18 different personas to pinpoint the mobile needs of the insurance company’s 4,000 employees.
What piques my interest lately is not mobile spending, although it is always useful to follow the money. (Or, for that matter, how employees are influencing tech decisions. Old news.) I want to know how CIOs are using their mobile dollars to transform business models at their companies — and in the process maybe even rendering the competition’s models obsolete.
Mobile computing is disrupting tried-and-true business models and centuries-old establishments. The seeds are being planted right now. The decision by Harvard and MIT to offer courses available to anyone who has a phone with an Internet connection is just one recent example. I’d like to hear how you think mobile spending is going to shake up your business. Let me know.