Post-modern CIO

Post-modern CIO

As group chief information officer, Tony Hood is responsible for strategic ICT oversight at the New Zealand Post. He talks to Darren Greenwood about the reasons and dynamics behind the new IS structure in one of the country’s largest state-owned enterprises.

A shifting role

Though the group CIO role is part-time, Hood says he will give the job “as many hours as it takes” and it will come first.

“We have to make sure there are no conflicts of interest. I continue my role at Finzsoft because there is no conflict. I cannot undertake tasks that take five days a week. NZ Post has to be the priority.

“My role also gives NZ Post the opportunity perhaps to understand what the CIO role should be, how it should be defined. It may be that organisations benefit by a constant turning over of positions. When you turn over positions, new people bring a different perspective. This may be a good system where we go into these processes of actually defining a role and blending that into the organisation. In two to three years, maybe someone else comes in and takes the role to a certain stage.

“Technology is important to the world. IT is now ICT and in years ahead we will be adding other things into the mix as well,” he explains.

NZ Post has diverse operations with varying IT requirements. It has its DHL courier business, there is KiwiBank, and other units including its ECN software division?–?all of which are businesses in their own right.

The varied businesses mean it can be tricky ‘aligning’ the business with IT. When the IT function is centralised, Hood says there are often concerns over cost. When IT is decentralised, there are concerns over innovation and value.

“Basically, if you take KiwiBank, they have many systems people. We need to say we don’t need KiwiBank to share their technology resources with other [internal] organisations because they have different requirements,” he explains.

While this might sound somewhat haphazard, Hood stresses he was not brought in to NZ Post to “sort it out”.

“NZ Post is a well-run organisation with some excellent innovation going on in a lot of areas. The strength of NZ Post is probably in its chief executive who is not looking at what the business is doing today but how we can be doing better tomorrow,” he says.

“I have probably come in as a supporting technology catalyst for business. [As a country] We haven’t championed technology, especially in government departments because the cost appears more important than value and CIOs are focused on cost containment. My role is to support the business units and their CIOs in making their technology case,” Hood further explains.

His new role has no one reporting to him bar an architect and no operational aspect either. He has no staff but can reel off names of people he knows and has worked with at NZ Post, following involvement with the organisation for five to six years.

Hood explains many CIO roles were previously described as IT manager and little has changed in what tasks are performed. But looking at his career, he highlights many decisions he made were strategic decisions that fundamentally changed the business.

When he worked for Westpac Bank in the 1980s, Hood helped the bank win the government banking contract by providing online banking and putting bank terminals into every government department. Deskbank was designed initially to support the Treasury in the Debt Management Office.

“We looked at technology, what we could do from a technology business to give government a different way of doing things. If every government department did their banking through a terminal system and Treasury knew every day how much money the government had, that wasn’t an operational view, that was a strategic decision.”

Hood believes there are many ways NZ Post can benefit from the use of technology, and says the organisation has often been a leader in this area.

KiwiBank, which Hood also worked on, led by sending email bank statements using “unchangeable” PDFs, a move other banks followed. Recently, NZ Post was involved in Microsoft’s Technology Adoption Program (TAP) as one of 10 companies globally that piloted the pre-production version of Biz Talk Server 2006. NZ Post worked with its subsidiary ECN Group in deploying the “middleware” to integrate disparate legacy systems across various parts of the organisation (see “Integrate and deliver” below).

The integration challenge

Hood says in the past, enterprise architec-ture generally consisted of the IT structure. But he foresees the trend over the next two to three years will be the integration of business and IT strategies.

“It’s not technological integration, it’s enterprise integration?–?business units getting closer to technology,” he says.

“We are seeking a situation where you are looking at quality-enabling your business through technology. We are not looking to produce rubbishy one-offs. We are looking at enterprise architecture, integrating business architecture, everything having its place.”

While it is still too soon to speak of anything more specific, he looks back to his own experience.

“Over the last years, I have effectively been involved in a series of projects. Everything I have done, even the restructuring of Databank, I am used to having a project, with a budget, a time frame and delivering the promised benefits. That’s very much the outcome of what we are seeking.”

Indeed, Hood, who was born and raised in Birmingham, England, before gaining a maths and stats degree at University College Wales, recalls an extensive career as an assembler programmer, which led into management.

Initially he worked for major multi-nationals like Philips Electronics in Britain before a couple of years in Switzerland with the International Labour Office, developing a search engine for its documents concerned with labour markets and productivity.

He came to New Zealand in 1975 and ran the customer services division of Databank systems before running the IT department of National Mutual and Commercial Union finance houses. Westpac bank followed, where Hood established the technology group, and further developed its Eftpos technology.

By the early 1990s, Hood was drafted back into Databank, which was owned by the main banks, to restructure its operations, making it more customer and technology focused. He then worked on its sale to EDS in 1994, becoming managing director of EDS New Zealand that year.

Hood then introduced Telecom to EDS (now a major customer) and feeling he was more of a “figurehead” in EDS, he began a consulting career 10 years ago.

Projects have included reporting how the Police could have moved forward from the INCIS debacle, establishing the regulatory regime for the then privatised workers accident compensation environment, the technology for KiwiBank from business case to implementation, and working as operations manager for the Building Authority, where he dealt with “leaky homes amongst other matters”.

Other consulting projects remain, such as one involving government regulatory activities. “When you are in a consulting environment you get involved in things that have a long gestation period. I am involved in things here and in Australia.”

Looking at the role of a consultant, Hood says you have to add value and says if he does not, he will not sit on the chair.

“To actually be on top of this technology area, you have to have some varied experiences. You cannot have these experiences by sitting in an operational role,” he confirms.

Now, with a fresh challenge at one of New Zealand’s largest state owned enterprises, plus his business interests, Hood likes to keep himself busy and is not even thinking of retirement.

“When do people retire?” he asks.

“You have to keep your mind young by exercising it!”

Integrate and deliver

New Zealand Post claims efficiency savings from its use of the Microsoft BizTalk Server middleware platform.

The SOE first installed BizTalk Server 2002 in its call centres during 2003, claiming its integration properties helped it install IVR in its call centres.

Now, New Zealand Post has just installed Biztalk Server 2006 in its NZ Post International division, working with its subsidiary ECN Group, an e-commerce provider, in implementing the project.

NZ Post International IT manager Lisa Harkin says the middleware helps the organisation automate its ‘data cleansing’ and matching services it offers to New Zealand customers who have offices overseas. Previously, some of these operations had to be done manually.

This was the first time NZ Post has used BizTalk 2006, though it and NZ Post International commonly use BizTalk Server 2004.

Harkin says the system is making the processing of data much easier and after a month’s further use, it will be extended to other external customers of NZ Post International.

NZ Post head of strategy and architecture Stuart Wakefield says the use of BizTalk allows the organisation to maximise existing technologies. It does not have to replace costly legacy systems and in terms of software, it does not have to re-invent the wheel every time, as the software architecture is very modular.

Wakefield adds subject to tests, other NZ Post divisions will migrate from BizTalk 2004 to 2006.

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