Trusted peers, game changers

Trusted peers, game changers

Our annual State of the CIO survey reveals more CIOs are moving into strategic roles, but they also need to ramp up on building relationships with non-IT business executives.

When Craig Columbus joined law firm Russell McVeagh four years ago, he inherited an IT organisation that was “already very lean, very operationally efficient.” In this environment, he says: “The goal is what IT can do to bring more revenue to the firm... What can we do to help not only ourselves work smarter, but how can we be more efficient for our clients?”

As CIO of one of New Zealand’s leading law firms, Columbus also has responsibility for areas beyond technology — the library, precedents, legal support services and due diligence business units.

Thus, it is imperative for him to be working across business units, meeting with both staff and his executive peers. “Getting out and being seen is part of it, meeting the people in other business units or the organisation to understand what they are going through, their challenges,” says Columbus, who reports to the CEO and is a member of the executive management team.

Room for growth, room for improvement

Being seen as a strategic partner — engaging in developing business strategy or being a primary driver of the enterprise’s competitive future — is a key goal of CIOs.

According to our annual State of the CIO survey, over a fifth (22 percent) of CIOs say they are perceived by the business leaders this way — as a business peer or game changer.

The survey finds CIOs fall across categories ranging from extremely tactical to highly strategic when it comes to how business stakeholders perceive their IT organisation. Nearly one in five of the CIOs surveyed (21 percent) say their IT organisation is seen as a cost centre — unappreciated, misunderstood and unfulfilled.

This year’s report, drawing on 596 respondents across the globe and conducted in September 2011, finds more CIOs are taking some action to improve or solidify relationships with business stakeholders.

A good number, however, still fall short in this area, with survey results suggesting a gap between CIOs’ perceptions and those of their non-IT peers.

Yet, nearly half (43 percent) report marketing the IT department so the business has a better understanding of IT’s capabilities and processes is a low priority (31 percent) or not a priority at all (12 percent).

Constant and emerging themes

For Aaron Kumove, managing director of Horizon Consulting, this year’s survey reveals consistent and interesting results. “The perception of IT being a cost centre has always been around for as long as any of us can remember,” says Kumove.

What is interesting in the current environment, he says, is the big focus on saving money in both government and private sectors, and the “nervousness” in what is happening in the global economy. In that sense, he says, the focus on saving money from IT is probably no more than anywhere else in the business. “It is a general focus across the board.”

In government, for instance, this can be seen in the amalgamation of government agencies which obviously meant the same thing was happening to their respective IT departments. IT, meanwhile, can be the lead in automation of processes and lowering transaction costs.

At the same time, Kumove says IT is perceived as more tactical and strategic. “I know of some organisations recently where the CIO has gone from a third tier to a second tier role,” reporting to the CEO.

He says that in organisations that are trying to reinvent themselves, IT can certainly become a game changer. Where there is a desire for serious transformation, like in some large government agencies, “IT will be a huge game changer or a contributor to the change.”

But for a CIO to be a game changer, “There has to be a willingness on behalf of a business to want to change the game,” he says. “IT can not do that on its own quite clearly.”

Columbus, on the other hand, believes there are more CIOs sitting on the executive table than in the past. “I would love to see CIOs in all industries step up this way,” he says.

“I have spoken to CIOs in some areas where they are not seen as strategic. And I think that is a shame. There are efficiencies that can be gained through the application of technology.”

Part of this is having the communications skills — “the ability to speak the language of the business” — when working with executive peers.

CIOs will shoot themselves in the foot if they walk into the executive leadership room and begin to talk about megabits and kilobytes, says Columbus. “CEOs want to hear how are you going to solve the problems, increase my sales, increase my top line and bottom line? How are you going to get me there? Do you have a strategy for getting me there?”

Building relationships

Rhoda Holmes, whose consultancy practice Raghnall Limited, focuses on transformation programmes, is a firm believer in the value of these cross executive discussions. She has been involved in organising CIO and CFO forums for the companies that are part of the Infratil Group that include Wellington Airport, Snapper and Z Energy.

Last year, Holmes was involved in the transition of the downstream business of Shell NZ into a new business Greenstone Energy, now called Z Energy.

At the end of the programme, she helped organised a forum for CIOs and CFOs of the Infratil companies. The one-day event saw executives of the different companies share insights on projects they were working on and how they can leverage contracts across the group. Holmes says these are “enabling conversations” so the different companies do not have to start from scratch for their programmes.

She says when they held the forum the CFOs and CIOs spent a lot of time talking about the business. “What were the trigger points? We were sharing the business rationales as much as sharing technology.”

Vetting the tech agenda

The 2012 survey finds companies plan to complete major initiatives this year using technology that will impact the role of the CIO. Roughly a third of the respondents (34 percent) predict technology as a service/cloud will have the most profound impact on the CIO role followed by mobility (25 percent), ubiquitous data/big data (18 percent), consumerisation of technology (13 percent) and social media (11 percent).

For Columbus, a key issue he and his CIO colleagues are facing is “this monster of mobility”.

“Mobility has put a whole new twist in the security model,” he says. “I have devices that are incredibly powerful, can store vast amount of corporate data, that can easily be left in a bar or taxicab. Those things we have to make sure we fully understand, make sure data will not be compromised.”

Meanwhile, people want variety in accessing their work documents — from their tablets, mobile phone, a laptop or desktops.

Columbus says their vision is to have solicitors have ubiquitous access to their data. “No matter where they are, they can pull the right records pull the files and they can do it in a secure way where they are able to maintain control, [and] no data is compromised. It is a big task, and we are committed to doing it,” he says.

Kumove, for his part, says security threats have been around in one form or the other. Where it is changing is that a lot of security threats are targeted at mobile devices. “They represent a new platform to be attacked,” and as more organisations adopt consumerisation of IT, that is an obvious area that will require close attention, he says.

Reality check in the cloud

For Chris Bunce, CIO of First NZ Capital, an area where the CIO can add value to the firm is to highlight the opportunities and challenges for the business. He says he and the team have been working on initiatives around the infrastructure side of the business and development of new research for their portfolios. A bespoke CRM system will be deployed this year. “We are watching and looking at other areas where IT can offer efficiency gains for the business.”

Security is one of the key factors Chris Bunce considers when checking out technology, such as the cloud. “We are essentially a bank, the key one for us is intellectual property. We need to protect that IP. We have clients and their portfolios.” >>27

Bunce says everyone talks about the upsides of the cloud. “It is cost effective, all these things. But there are huge downsides. Control, data, security, vendor lock in.”

“The cloud has huge benefits for the right organisation,” he says. For instance, a 100-seat company using Salesforce is getting the same technology that a big organisation has.

But the Amazon outage last year brought home huge lessons to Bunce. “The risks and exposure are still there,” he says. “You end up really managing your IT system based on a contract.”

IT is complex, he says. “Right now, no matter how big your organisation is, in your leadership role you have to manage risks in regards to any change. Any initiative, anything you do, must consider risk management.”

Virtual, agile teams

Meanwhile, Bunce is focusing on building a team that can respond to changes in the market and technology environment. “I operate an interesting model,” says Bunce.

He has 10 full-time staff, but taps contractors for projects. He has formed “strong alliances” with major providers like Microsoft and VMware.

“You get the benefit of the ‘big brother’ by having them here one day a fortnight,” he says.

The VMware technical account manager is very hands-on with the IT team, but Microsoft, which has a vast product suite, sends its account manager to their monthly meetings. “When you phone them, they know who you are or your environment,” he says.

He also has a “virtual team”. “These are individuals we call upon, who are strong contractors and professionals, the top of their field,” he says. “Having high calibre individuals make it easier for you to do your role.

“They want to come in and get their hands dirty, get involved and move on. They hit the ground running. They know the environment and they are productive.”

Bunce says his role is to maintain relationships with these people and he keeps in touch with them on a monthly basis.

As to how CIOs can continue to keep abreast of new technologies, Bunce shares this approach: “I pick strategic companies around the world and study what they are doing,” he says. These are mainly technology companies like Facebook, Apple and Google.

“They are in the forefront of technology,” explains Bunce.

“They are not afraid of change, they are not afraid to adapt if something is better, they seem to operate very agile frameworks.

“They are nimble enough so they are able to adopt those technologies very quickly.”

Sidebar: Rise of the CIO-plus

Fifty seven percent of CIOs surveyed are responsible for one or more non-IT areas. The most commonly added functions:

• Security

• Strategy

• Risk management

• Administration/operations

• Customer service.

Twenty responding CIOs are in charge of mergers and acquisitions, and 17 are in charge of environmental sustainability.

Source: CIO US

With reporting from Kim Nash of CIO US

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