Gather the typical left-brain, articulate, umm-less group of CIOs around a conference lunch table and, guaranteed, the talk will eventually turn to reporting relationships. You answer to whom? Since when? How is that working out?
CIOs, as I take the editorial liberty of saying in my story today on SearchCIO.com, tend to scrutinize reporting lines like entrails or tea leaves- a portent of how well they’re doing and where they’re headed.
Any CIO I’ve queried on the topic thinks it’s best to have a direct line to the CEO. Makes sense. Sure, you’re turning somersaults to please the business, and likely with a polite smile on your face — who can you escalate to, if the CEO is telling you what to do? But better to have the ear of the head honcho than not.
The Forrester study of 503 IT execs by analyst Bobby Cameron pretty much bears this out.
CIOs who report to CEOs have the largest budgets, as measured in terms of percentage of total company revenue. Your job comes with a centralized planning function and so you are more likely to manage IT through centralized offices — PMOs, vendor management. But – and maybe this is a function of playing in the big leagues by big-league organizational rules – you’re a little down on IT’s ability to be a game changer for your business, unlike your counterpart who reports to the COO.
Woe to you who report to the CFO. I feel your pain, right through the measured tones of Cameron’s data-filled summary of the survey.
By the way, the CIO-to-CEO reporting relationship now constitutes the largest cohort, while the number of CIOs reporting to the CFO has shrunk over the past three years. As business becomes more appreciative – and, yes, knowledgeable – about the impact IT can have on the company, Cameron says he expects to see another shift of CIOs reporting to operations officers.
Check out the story for more details.
When I caught up with Cameron on his cell phone last night, he told me a couple of interesting anecdotes about CIOs expanding their reach. (Like most Southerners, he’s a natural story teller.) At Jet Blue, for example, the CIO owns marketing. Hewlett-Packard, for a time anyway, put the CIO in charge of supply chain. He sees the trend continuing as IT makes the transition that Forrester has been pushing for years – to BT, business technology.
Let us know to whom you report, and the plusses and minuses of that reporting relationship.
SAP AG sends word today that it’s putting subsidiary TomorrowNow, which provides third-party support for Oracle and other applications, out of its misery.
The German software maker said it will wind down the operations of TomorrowNow, ushering the firm’s current 225 customers back to the Oracle fold for maintenance by Oct. 31.
For non-SAP/Oracle aficionados, the Bryan, Texas-based subsidiary is the target of a high-stakes lawsuit filed nearly 18 months ago by Oracle Corp., accusing the third-party maintenance provider of practicing “corporate theft on grand scale.” The alleged crime: using passwords of former Oracle customers to download information “outside the purview of what the customer had licensed.”
SAP admitted that some of its TomorrowNow employees inappropriately downloaded Oracle materials. For an excellent chronicle of the legal battle, skirmish by skirmish, go to SAP’s website.
The TomorrowNow closing marks the end of a three-year boondoggle for SAP, which bought the firm in 2005 following Oracle’s $11 billion or so acquisition of PeopleSoft Inc. Started by former PeopleSoft engineers, the firm promised cheaper third-party maintenance for all those disgruntled PeopleSoft customers. SAP said in November that it was putting the subsidiary up for sale but determined that a sale would have been “an extremely complicated transaction for both the seller and the buyer.”
Our gloss for CIOs
When the suit was filed, we thought the 43-page complaint carried a message for TomorrowNot CIOs as well, namely to exercise all due care when moving from one maintenance provider to another. To read more about why the topic of third-party maintenance is so sensitive, go here.
For a provocative take on the trials, tribulations and merits of third-party maintenance, go to my interview with Seth Ravin, co-founder of TomorrowNow. Ravin sold TomorrowNow to SAP before moving on to start Rimini Street and recently passed up the opportunity to buy the company back.
Last week was a busy one on SearchCIO.com, and that’s why I’m here to help you zero in on any of the stories, videos or podcasts you might have missed!
- E-records management moves up the state CIO agenda – E-gads, there are a lot of e-records to keep track of! As the business of running a state government moves increasingly to electronic form, e-records management moves up the CIO agenda. NASCIO offers help as well as firsthand accounts from state CIOs.
- Firms building websites with global reach – CIOs, we’re not in Kansas anymore. Corporate websites today must speak to people all over the world. So how do you keep your message from being lost in translation? It’s a balancing act of leveraging local and global needs.
- Vendor management advice for CIOs - Who hasn’t hit a snafu with a vendor at one time or another? In this expert video, learn from Forrester Research Inc.’s Christine Ferrusi Ross.
- Compliance and offshoring best practices for the CIO – This expert podcast, courtesy of Forrester Research Inc.’s Khalid Kark, offers tips on how to offshore and still be in compliance.
- Outsourcing uptick result of slow economy - Economic uncertainty apparently has companies rushing to outsource, pushing the volume and dollar amounts to record highs in the first half of the year, according to advisory firm TPI.
How’s this for a headline: “Meet the Millionaire CIOs.” In a study of the filings of the 1,000 biggest U.S. companies and their compensation, 47 top technology executives were listed at the top 1,000 companies. According to the latest SEC filings, these 47 earned $112,651,463, with an average salary (excluding bonuses and other compensation) of $435,200.
Excuse me for a moment as I sit here and mourn my comparatively meager journalist-sized paycheck. … OK, I’m back. I’m reminding myself that these are the very highest-tier CIOs. According to our salary survey last year, which polled nearly 1,000 IT professionals, the average salary of senior-level IT executives at companies with more than $1 billion in revenue was $144,440 in 2007.
Want to let us know how you rank, and how the current economic climate is affecting CIO salaries? You can start by filling out CIO Decisions Media’s 2008 Salary and Career Survey!
Also, I need an excuse to direct you to my colleague Zach Church’s excellent post on the SearchCIO-Midmarket.com CIO Symmetry blog about the San Francisco IT chief who is being held on $5 million bail after locking the city out of its own computer system and refusing to yield the password. The IT chief in question, Terry Childs, reportedly made a base pay of $126,735 last year. He also had another $22,534 tacked on because – get this – he’s on call for emergency situations. Oh, the irony. … I guess being paid comparable to your peers doesn’t necessarily buy job satisfaction.
The videoconferencing industry grew about 30% in the past year, according to The Boston Globe. One analyst estimates conferencing technologies factory revenues totaling $8 billion in 2008, and projects that they’ll grow to $10 billion in 2012.
Thanks to those rising fuel prices you may have heard about, more and more organizations are looking to trim travel costs where possible. I’m curious whether CIOs are seeing correspondingly more requests to look into these sorts of videoconferencing technologies? Will they save your business money? Reduce your carbon footprint? Other advantages?
Question: What do CIOs and rifle heiress Sarah Winchester have in common?
You’re haunted by ghosts and can’t stop building, says Phil Murphy, principal analyst with Forrester Research.
Phil was a keynoter at our CIO Decisions Conference last month, a gathering of some 200 CIOs in Carlsbad, Calif. Before giving CIOs a primer — and detailed scorecard — on how to sort out the many competing demands for IT dollars and get the most out of your IT investments, he began with the cautionary tale of Sarah Winchester and her 160-room Victorian mansion.
Winchester was heiress to the Winchester Repeating Arms Co. business in New Haven, Conn. Her only child died as an infant. After the death of her husband in 1862, she was left with an extraordinary income of $10,000 a day and an unshakeable feeling that the family she had married into was cursed. She sought guidance from mediums, one of whom obliged by saying the Winchester family was indeed under a black cloud — cursed by the spirits of the people killed by Winchester rifles.
To break the curse, the widow was told to move to California and build a house for herself and all those spirits. If she stopped building, she would die, so work continued 24 hours a day, seven days a week and 365 days a year for the next 38 years.
And the resemblance to CIOs and IT platforms? You can listen to Phil spell it out in this blogcast excerpt from his keynote.
Meantime this tidbit from the Wikipedia entry on Sarah’s building boondoggle gives you the idea.
Due to the lack of a master plan and constant construction, the house became very large and quite complex; many of the serving staff needed a map to navigate the house. The house also features doors that open into walls, staircases that lead nowhere, the recurring number 13, and windows that look into other walls.
Check out an aerial view of the place here.
Is it possible that in this hair-raising economy, supply and demand in the IT job market are in balance?
Data out this week suggests that may be so. The latest report from Dice, the online career site, shows a 14% drop in the number of available technology jobs from the same period a year ago — 86,988 as of July 1, compared with 101,438 jobs in 2007. The year-over-year decline, the largest so far this year, follows the trend of the last six months. The job numbers posted by Dice in 2008 have mostly lagged last year’s totals by between 2% and 12%. Another worrisome fact: the recent months mark the first time since 2003 that jobs listings have gone down.
But if the demand for IT workers is decreasing, so may be the supply of IT workers.
Unemployment in computer-related jobs is near historic lows at 2.3%, according to U.S. Bureau of Labor statistics. Compare that with the 4.7% total unemployment in the last quarter, or 5.5% unemployment figures for June, and IT would seem to be a sweet spot in a sour economy. Or at least the number of people leaving the field appears to be in synch with the demand for IT expertise in this country.
Should we keep waiting for the other shoe to drop? When I reported on jobs in April and the two data points showed the same pattern — a decrease in jobs combined with record-low unemployment — some industry experts like Andrew Bartels of Forrester Research wondered whether the healthy numbers were a leading or lagging indicator of the IT sector.
Copacetic is not a word often paired with the IT industry, but it may be an apt descriptor for what’s happening with IT jobs. Let us know what you’re seeing in your neck of the woods.
Some details from the Dice report:
The July jobs numbers from the Dice Report also come with a note about the perception gap between Human Resource (HR) departments at companies that hire their own IT staff and the staffing, recruiting and consulting firms that dispatch IT employees to workplaces. In short, the majority of the HR professionals (52%) told Dice they anticipate no change in hiring plans for the next six months, while 62% of the staffing, recruiting and consulting outfits expect their clients to cut back on hiring. Interestingly, both groups say it is taking longer to fill positions than a year ago but differ as to why. The HR pros say it takes longer to fill positions because of the scarcity of qualified candidates, while staffing and consulting firms chalk up the lag to a slowdown in hiring, and lack of urgency on the part of employers.
Read on, for the job numbers from the top 10 metro areas for IT employment. Seattle was the sole city in positive territory, with a 7% increase in job listings.
Help wanted: The chart shows the number of job listings as of July 1, 2008, by metro area, and the percentage change compared with the same period a year ago.
|9,042 New York/New Jersey||-17%|
|4,150 Los Angeles||-17%|
|7,347 Washington, D.C.||-11%|
Source: The Dice Report, July 2008, July 2007
As you head into this disappointingly short two-day weekend, be sure to catch up on anything you might have missed on SearchCIO.com this week:
- Think you’re a green computing guru? Put your knowledge to the test with our green computing and energy efficiency quiz!
- Learn about IT asset tracking software, which quickly inventories what’s on your network and promises “actionable” databases that will help cut costs and improve security.
- Be honest: Do you love or loathe cloud computing? Check out these 12 aspects that could sway you either way.
- What’s the point of outsourcing portions of your business if you don’t have the proper contract in place to protect your organization and allow it to thrive? Reduce risk by covering all of the contract basics in your outsourcing endeavors. For more on this topic, see our previous post.
Today, we posted a story on SearchCIO.com about mitigating risks in your outsourcing contracts. Clearly, it’s a topic affecting organizations all over the world and, while catching up on my tech-news reading this morning, an article from Financial Times dealing with chemicals manufacturer Ciba’s outsourcing contracts and efforts caught my eye.
Since 2006, Ciba has agreed to four main IT contracts, each covering a set of “service towers” for different IT functions, the article says. The company’s CIO, Erwin Becher, goes on to cite the triumphs, disappointments and lessons learned from his firm’s outsourcing contracts.
Check out both articles and come back to share your thoughts. Is your company outsourcing some or all of its IT functions? If so, what elements have you found most crucial in crafting a contract?
News flash: The Boston Globe reports today that a representative of Cognos ULC, the business intelligence software maker, improperly offered a Massachusetts state official a job in 2006 when the company was pursuing a multi-million dollar contract with the state.
Globe reporter Andrea Estes and correspondent Stephen Kurkjian report that the job offer “could have violated the state’s conflict of interest law, which bars individuals from offering anything to a public office with the intent to influence an official act.”
The job offer is “another instance of Cognos appearing in the thick of questionable activity in pursuit of state business,” the story contends, pointing to a $13 million performance management software contract awarded to Cognos in 2007. The contract raised eyebrows after critics complained it was signed in haste, and it was subsequently revoked by Massachusetts Gov. Deval Patrick in March 2008.
The Globe reports that in the case of both contracts, dealmakers from Cognos, now owned by IBM, bragged about ties to Salvatore F. DiMasi, the powerful Speaker of the Massachusetts House of Representatives. DiMasi has denied having anything to do with either contract.
Joseph Lally, the Cognos rep who allegedly made the job offer on the 2006 contract, did not respond to requests for an interview from the Globe.
Negotiations on the state contracts occurred before the Canadian BI maker was bought by IBM. Big Blue spokesman Chris Andrews told us that IBM has no comment on the Globe story.