The year of leading strategically

Re-imagine your role, embark on a new IT model, use technology to cut cost and bring revenue. These are just some of the items on the CIO's 'to do list' as outlined at the annual Gartner Symposium.

“Find new answers to new questions as opposed to new answers to old questions.” For Mark McDonald, group vice president of Gartner, this is the essential strategy for CIOs as they work through the economic, strategic and technology shifts in the upcoming months.

McDonald sets the tone for the leadership imperative for CIOs in his keynote at the annual Gartner Symposium at the Gold Coast in Australia, as he challenges those present to “reimagine IT”.

We have to think of IT in new ways, lead it through a process of “creative destruction”.

Creative destruction, he explains, develops new resources by dismantling and redirecting existing ones. In IT, the term means applying new technologies and practices in ways that direct or liberate resources to deliver greater innovation and value.

Peter Sondergaard, senior vice president and global head of research at Gartner, says we are now in an “era of mass collaboration driven by the consumerisation of IT”. For the CIO to thrive in this environment, they must reimagine their role, and “lead from the front”.

This era, he says, brings with it urgent and compelling forces, mainly the cloud, social networking, mobility and an explosion in information. On their own, these forces are innovative and disruptive. “But brought together, they are revolutionising business and society,” says Sondergaard. “This nexus defines the next age of computing.”

Mobility is at the forefront of consumerisation of technology. But the future of mobile computing is “context aware computing”, says Hung LeHong, vice president Gartner Research.

This is the intersection between the user’s “separate lives” across the digital, mobile, social and physical worlds. Context-aware applications take context about the person in the physical world — such as location, time of day — and the usage patterns in the digital world, and deliver it to the mobile world.

Dale Kutnick, Gartner executive programmes senior vice president, posits another challenge for the role — generating revenue as a central component of their IT organisation.

John Roberts, Gartner vice president, brings forth the idea of becoming a post modern business, which like in architecture, means “anything goes”.

“A post modern business is one that completely rethinks the status quo of business and embraces dramatically deeper relationships with its customers, suppliers, and partners,” says Roberts.

Think of it like McDonalds, he says. “Your business has no walls — it must be everywhere. It will be a virtual and fluid business that changes as customer changes.”

Milind Govekar, vice president, Gartner Research, hurls another challenge for CIOs: “Destroy perfectionism... and embrace calculated risk.

“Never taking risks means you are predictable and an easy target for your competition,” he says. “We must change the way we think, plan and talk about our IT leadership roles.”

Object lessons in leadership

Leaders from across sectors, meanwhile, share insights on managing the range of issues across networked enterprises.

At the Australian Broadcasting Corporation, managing director Mark Scott, says the goal is to continue to find ways to operate efficiently and effectively to free money for innovation.

He says there were sobering moments when they reflected on the dominant new players out there — Google, Amazon, Facebook and Apple. “They weren’t big media conglomerates,” he notes. One of the reasons why established organisations find it hard to make this transformation is because they have always been successful with what they have done. They are therefore being defensive of this model. “You have got to be able to continue to experiment, try new things and doing enough of those things and following them through,” he says.

Leading ABC since 2006 has involved creating compelling, relevant content and delivering it to the audience at a time, device and format they want. “We tried initiatives that worked and didn’t — and backed the ones that worked,” he says.

The executive team consulted extensively to understand where the market was going and what they were going to do with content, audience expectation and capital requirements for the digital age. Scott forayed into social media, maintaining an active Twitter account, and not trusting anyone to send out messages on his behalf. “This social network stuff is important to us, our future,” he says. “There are risks involved, we are not gonna be frightened, but understand it and deal to it.”

His media strategy? “Create great and distinctive content that is going to be valued, respected, sought by audiences and distribute it to areas where audiences can find them.”

Success in turbulent times

Retired major general Jim Molan discusses how strategies in the battlefield can be applied in the networked enterprise. “We are always in challenging times,” he says.

Molan was named 2009 Australian Thinker of the Year for his work leading 300,000 troops, including 155,000 Americans in Iraq. “Direction is the ultimate function of leadership,” he says.

For CIOs, this relates to keeping systems going, rolling out new systems all the time. “You can lose the strategic focus because you have to keep current systems going.”

“The boss has to think of the big issue but someone has to take responsibility for the details,” he says, on this strategy which he calls “constructive paranoia”.

He adds, “We want people to question us all the time,” though there is one command he will not question: “Duck.”

Key differentiators

Mike Harte, group director enterprise services and CIO of Commonwealth Bank, says being customer-centric is a key differentiator for companies. “But if you have not made investments to be a truly customer centric authority, [you] can’t keep that differentiator,” says Harte.

A huge differentiator is the capability in your staff, he says. “How many of them can create dynamic content on mobile devices? How can they harvest assets they have today turn them to relevant content to multiple devices in the future?”

Some of the technology and infrastructure will not confer strategic advantage and you can have them commodised to your advantage, he says.“Outsource [the] backend and put money on the front end.”

For the CIO, meanwhile, it is about how to become a peer around the C-suite, knowing the challenges in the marketplace and helping the organisation become more efficient.

“We have a lot of jargon,” he says. “Simplify the story for the business, help the business understand how we can make process more efficient, digitise the value chain, take out manual process if you can.

“How do we go after new customer revenue, create new products and services, create deeper relationships with customers?”

He says it is important not to be stuck on models of thinking in the past. “Try and experiment,” he advises. Do not be afraid to fail and learn a lot from “quick, low-cost failulres”.

Use your technical capability to building services customers want, he says. “We all have to learn, develop, evolve and change. Nothing stays static.”

Not business as usual

Dave Aron, a fellow in the CIO Research Group of Gartner, looks outside IT and the corporate world — for ideas on innovation. He distills practices from some of the world’s best innovators:

Authentic leadership: Pete Goss has completed four trans-Atlantic and two around the world yacth races, and is strong on values-based leadership. He believes most companies have too many tacit assumptions, says Aron. He brings out these assumptions in the open and discusses them and those who can’t agree with the core values of the team should leave.

Driven by a higher purpose: Kiyoshi Hamemiya, CEO of construction firm Yamanashi Hitachi Construction, was moved by the plight of amputees — victims of landmines — during a visit to Cambodia. He assembled a group to build the world’s first landmine clearance machine, adopted from a construction machine. The machines are now deployed in eight countries and represent 10 percent of the company’s business.

Protecting the space to innovate: Ferran Adrià, is head chief of El Bulli, named the world’s best restaurant four times in a row, which he transformed into the world’s first culinary R&D laboratory.

Adria closed the restaurant six months a year to enable his team to innovate and learn from other disciplines, which led to their pioneering of the molecular gastronomy style. “If you use the same process to innovate every time, you get monotony and repetition — the death of innovation,” says Aron.

Pulling strings

A Gartner survey of CIOs across the globe finds majority of respondents said it was time for IT leaders to strengthen their position within the enterprise.

The task may not be as straightforward as Tina Nunno, vice president in Gartner’s CIO research group, points out organisations have a”schizophrenic” view of the CIO. She quotes one of the respondents, “Did you hire them to keep the Blackberry and dial tone going? If so, you need a follower. Did you hire them to help determine where this company is going to go in the future? If so, then you need a leader.”

The issue is around how powerful is the CIO in the enterprise. She describes power in the context of the CIO as the ability to make appropriate decisions to resolve conflicts and to make something.

Nunno takes on the view power politics is ethically neutral and can be used to make decisions and resolve conflicts. “If you do not have power, you cannot wield it for good or evil,” she says. Power is also like a muscle. “If you do not use it, you lose it.”

Her pointers for CIOs? “Read Machiavelli’s The Prince,” she admonishes. “Twice.”

This 15th century political treatise is a guidebook on how to run a dictatorship and one of the most highly read books by CEOs, says Nunno.

To grow power, Nunno says, deposit more than you withdraw. An example of a deposit? Provide a “shiny object” — an iPad, an iPhone. “You are one of the only departments that has shiny objects to give.”

She cites an example of a CIO refusing to give a CFO an iPad when the latter asked for one. Six months later, the CIO will ask for money for infrastructure and the CFO will say. “I asked you for a US$500 dollar iPad. You said ‘no’. Now you want a million dollars for infrastructure. I am thinking, ‘no’.”

A ‘deposit’ can also be an award to the best project sponsor or team, completing a pet project for a business peer, and being helpful and open to the input of others.

As for withdrawals, these include saying ‘no’ too often, having an IT failure and surviving, placing staff in extreme situations too often, and being overly unpleasant and self-focused.

She says CIOs should use their power wisely. Use ‘trial balloons’ and test your different ideas in the organisation, she says. “Choose the battles that need to be fought for strategic gain, even if you lose in the short term.”

Don’t bore the board

The board are among your most valuable customers, and when interacting with them, “It is more important to be interesting than to be complete,” says Nunno.

She advises keeping in mind the three things the board considers valuable — cost savings, top line growth, and risk reduction. “All IT related investments can and should be analysed against these three criteria.”

At the same time the conversations with the board need to be appropriate to the level of maturity as an IT organisation.

Nunno shares this guide, with the BOARD as an acronym:

Brief: When presenting to the board, be succinct as possible, 15 minutes on the average. Nunno says some CIOs prepare a 45-slide deck for their presentations. “I admire the optimism, but the likelihood that is going to work is low.”

Open: Share with them the good, the bad and the ugly, “particularly the risk perspective”. The board hates surprises.

Accurate: Make sure the information you present is “incredibly accurate”. If you don’t know the answer, that is okay so long as you don’t say this 17 times in a 15 minute presentation, she says. The boards prefer you get back to them.

Relevant: Keep in mind what directors need to know. Do an internet search of all your board members. What is their background or profile?

Diplomatic: Be tactful and sensitive to what is happening around you and skilfully respond to it, she says.

Finally, consider using technology, like the CIO who prepared a live demo of apps before the board. “Embrace the passion you have for the technology and show them the possibilities and how it can positively impact your business.”

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