Linus Chang was ready to give up his business, providing backup software for Windows platforms, when he made his first sale – to a cemetery.
It was his third attempt to start a business. He had quit his job to concentrate on this latest endeavour, but was beginning to think nothing would come out of it.
Stories by Divina Paredes
Linus Chang was ready to give up his business, providing backup software for Windows platforms, when he made his first sale – to a cemetery.
The Megaupload case highlights a key area more and more CIOs are getting involved in – risk management, says Steven Hedge, CEO of systems integrator ISI.
Hedge says businesses could not access their data they lodged at the Megaupload site founded by Kim Dotcom.
“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.
Democratisation of data inside a company to make a business agile is important, says Kee Siong Ng, senior data scientist at EMC's Greenplum.Traditionally, he says, there is a conflict over how to classify data mining -- is it an information technology application or part of the wider business. "You see it moving back and forth," said Kee Siong in his keynote address at the 2012 SUNZ Conference in Wellington last week. "One thing you must do is try to formalise that relationship, and really emphasise this collaborative environment," he says. "You might have the infrastructure being managed by IT, but the data side is really owned by the business." This division, he says, is a major problem in a lot of organisations, except in internet companies like Yahoo and Google. "Even in places where they have done data mining in 10 to 15 years, they still have that wall."His advice to enterprises: "Put all your data to work, have a data strategy, first invest in people, then technology," he says. "It is all about efficient, agile analytics."<strong>Veering from tradition</strong>He says a typical scenario in organisations is that critical data goes to a large data warehouse, which is controlled by IT. In this system, you can do "shallow type reporting", and then there will also be "shadow systems" built across the organisations to support new data sources.Users will have to export data from the data warehouse and combine this with data from the "shadow systems" to do analysis. Most of the time, they are also working on small samples so the analysis is not complete. He describes a new analysis practice for big data which he calls "MAD" for magnetic, agile and deep. The goal is to build models using all available data, he says. Every time you get new data sources, you don't have to worry about how it fits with the current scheme, you just put it inside the analytics warehouse in its raw form. Agile allows analysts to work faster, and makes it easier for them to push back the results for deployment. Deep analysis allows data mining in large datasets.<strong>High performance analytics in action</strong>James Foster, chief technology strategist for SAS ANZ, says there is misconception that big data refers to companies like Amazon and Google. "It is not just about volume," he says. "It is not how large your data is that you can actually manage. [But] What is relevant for your organisations to make decisions and using the right information?"High performance analytics in the context of big data is turning that data into information and insight, he says. "There is a difference between the information they are currently using and they could be using to drive value."Across industries, he says, there are specific areas with lots of challenges around big data. In insurance, for instance, the business issues are around telematics, claims analytics, ratemaking and catastrophic modelling. In government, the data is around tax fraud/collections, criminal justice, pension portfolio risk, child support areas and delinquences, and in manufacturing they are around predictive asset failure and inventory allocation optimisation. In a lot of organisations, the issue is around customer analytics which include segmentation, acquisition and churn. He says many organisations approach the situation from a technology level. "We need infrastructure to support it, we need to put data in one place and then we will figure out what to do with it." He likens it to a "build it and they will come, a <em>Field of Dreams</em> situation."He suggests taking a different approach. "You have got to focus on the business problem, what am I trying to solve?"What is the actual problem and work backwards," he says. "What is the information that I can potentially use to solve that problem? How do I get that? "Part of the big data challenge [is] if you go down the traditional approach of, 'I am going to structure my data in a certain way,' you are already making assumptions on what data is important rather than letting the data speak for itself. "High performance analytics is saying, why can I not have all the data there and let the data tell me what is important?""You can use analytics to go across all the data, it might pick up trends or pieces of information that you would have excluded from previously."His key advice to CIOs? "Treat data and information as an asset to your company, understand that you need to have an enterprise approach to analytics.""Consider how analytics is used in the organisation and help drive those business outcomes rather than just providing infrastructure support. "There are operational applications that are integrated with the front end. IT's role is to understand how that integration can work and make sure it delivers on that business value."HSBC is a good example to reinforce the increasing importance of IT in these analytical environments, he says.HSBC used analytics to understand the losses due to fraud. A typical fraud process, he says, is detected after the fact, and there is a need to refine the detection models. For instance, if someone in Paraguay is buying a car using a stolen credit card, the owner is called after four hours and has to cancel the card. HSBC is now using SAS fraud management to protect all credit card transactions in real time. The solution runs at the point of transaction to decide whether that transaction is potentially fraudulent and runs analytical processes quickly. The shift is from fraud detection to fraud prevention, says Foster.The result is significantly lower incident of fraud across tens of millions of debit and credit card accounts, and improved detection rates and significant reduction in false positives. In HSBC it is important to run analytical processes quickly and in an environment that is highly available. IT in this case plays a critical role, he says. "They need to own that platform both from an availability perspective, from management and monitoring perspective and integration perspective.""Working with the business is a throwaway statement," says Foster. "Everybody is saying IT and the business need to work together, but analytics is a core reminder of that." <strong>Sidebar: When your job title is also a buzzword</strong>The data scientist as a job is becoming one of the buzzwords in IT today. Fortune magazine calls the data scientist as the <a href="http://tech.fortune.cnn.com/tag/data-scientists/">"hot tech gig"</a>. It is also one of the most important roles in companies as they grapple with the reality of dealing through massive data generated internally and externally."It is fundamentally an interdisciplinary field," says Kee Siong Ng, principal data scientist at EMC Greenplum. Apart from dealing with data computations, you have to know statistics, computer science, understand big data and more importantly, he says, have the knowledge and "active interest" in how businesses and IT departments work.But he says one of the most important traits for the job is "curiousity...in everything.""There will always be technology changes over the years. [And] If you are not naturally curious, you learn that things become relevant for three to four years, and then you become comfortable.""You have to stay curious and keep finding things on your own," says Kee Siong, who moved to EMC over a year ago from the Australian National University, where he continues to be an adjunct lecturer. "That is, perhaps, the only skill you need because everything else you can learn."
Gartner calls them "versatilists" -- and they are necessary in order to build agile teams.
Brendon Lynch, Microsoft's chief privacy officer, urges enterprises to embark on a comprehensive approach to manage privacy implications from the rise of big data and advances in technology."The use of information is going to be a strategic asset for the organisation and privacy is going to be important," says Lynch, who was originally from Paeroa and is now based in Microsoft's headquarters in Redmond.
"To run a company properly, you just need to have IT and it doesn't matter whether you dig stuff out of the ground or put a man on the moon," says Mark Franklin, chief executive of Stevenson Group. Stevenson Group, founded 100 years ago, has businesses in quarrying, mining, engineering and agriculture. But, as Franklin points out, information technology is critical to its daily operations and sustainability."We have quarries but you can't work without technology. You can't work without knowing how many trucks are going on this route, how much material you will need for the concrete plants.""Thirty years ago, probably, you would say we will put five trucks over there," says Franklin. But not at the company's current scale, with 500 employees across five subsidiary operations mainly in the Auckland Region, and further sites in Waikato and the South Island.Franklin has a firm grounding in IT, having been chief executive of Vector, and general manager of IBM Global Services in New Zealand.<strong>Chief transformation officer</strong>In October 2010, seven months after Franklin moved to Stevenson Group, his former CIO at Vector, <a href="http://cio.co.nz/cio.nsf/specials/28E8F028483D8B84CC257925007DAD53?Opendocument&HighLight=2,andries,van,der,westhuizen">Andries van der Westhuizen,</a> joined him as group IT transformation manager.Franklin says having "transformation" integrated into the CIO title "is a signal to transform the organisation". "IT was starting to become very decentralised and when Mark Franklin came on board, he moved towards a shared services model that will be run centrally not just for IT but also for other areas like finance," says van der Westhuizen. The vision includes changing the technology platforms. "Mark knows the advantages from using the right technology and he is changing the company," says van der Westhuizen. "He sees IT as one of the building blocks to achieve what he wants to achieve.""When I arrived at Stevenson, IT was seen as, 'if you can bypass them, bypass them' because it was just a stumbling block," says van der Westhuizen.The two executives say the group is already halfway through an exercise of the transformation programme for business technology across the group.The biggest change will be around the financial system, van der Westhuizen says. The group ERP, which is mainly for finance, is JDE 2000 version that was implemented in 2003, with F2 (two separate instances) and Accredo."We are currently looking at Microsoft Synamics AX 2012, the latest version of JDE and SAP All-in-One to replace the four financial systems and improve our capability on asset and customer management," he says.The group also replaced its "fragmented" WAN, a move that will allow it to consolidate its systems and share information in a cost effective and reliable manner.He says the group still has a mixture of Office programmes with the majority on 2000 and 2003, but with 2007 and 2010 versions also deployed. A few "satellite" sites (companies) are running different versions of Microsoft Small Business Server."These sites will be collapsed and integrated into the 2008 Active Directory. We will then bring every site onto Office 2010. This is where we might follow a hybrid model between Microsoft 365 Office (the cloud version) and locally installed Office 2010, depending on the needs and mobility requirements of the users," he says.This was a much better situation than a year ago. There were, for example, eight different email environments across the group. "The email environment was in a shambles with different solutions in various stages of deployment or decay."There was an MS 2000 on-premise exchange with an antiquated Mail Marshall, Lotus Notes deployed to a small number of users with BlackBerry phones and Gmail was used to push mail to the phones. The "satellite" sites were also running their own email on Microsoft Small Business Server.The first stage, he says, was to implement business productivity online services (BPOS) and give more staff access to mobile email (smart phones and iPad). He says this gave IT the opportunity to remove MS 2000 on-premise exchange, Lotus Notes, Gmail and the BlackBerry environments. Stevenson made the bold move to be the first in New Zealand to migrate from BPOS mail to Microsoft 365 mail early in December. "Microsoft Office 365, Active Directory 2008 and the new WAN will give us the ability to migrate the remaining satellite sites into the new environment, where we can realise the synergies of the use of a standard commodity IT environment across the group," says van der Westhuizen. <strong>Change management strategy</strong>Van der Westhuizen was the first executive to look after IT as a group. "My function is mainly change, bringing new things, investigating new things.""The challenge for transformation and change [is] if you don't do it regularly, people will settle and they will be 'safe'. They will be able to build the walls around and live in this perceived utopia. Then it is so difficult to change."The way to manage this is to bring in change or transformation constantly, he says, and show the people the benefits of the change they will otherwise resist.Van der Westhuizen says the three pillars of a successful initiative are: people, process and technology."You need to keep people on board, and you need to make your processes clear," he says. Your technology or your tools -- can be a spade or an ERP system. "But you need to have the right tools. If you have just got the tool but people don't know how to work it, then it starts to fall over."He took on a phased approach to change. "I didn't go and just grab everything," he says. "If something works right now, leave it until we have got the foundations right."He started "from the bottom", Active Directory. He says he checked out what was the best option for email as the whole group had at least four email systems. "It was just a bit of a nightmare and the first challenge was to move us to a single email platform as a group."The move to BPOS gave the staff immediate access to their email on mobile devices. "That was a small change from an IT perspective but the business benefit was huge."The same approach was used when he reviewed the desktop and mobile environment. He found most of the units were five years old. "I convinced a few guys to have just PC on their desktop and an iPad. I don't need to roll out a laptop and it is more or less the same price. They love it and it is cooler."<strong>A seat at the table</strong>Van der Westhuizen finds it an advantage to work with a CEO who understands business technology. "Getting that [support] from the top just makes my life easier," he says, "On one hand, it makes my life a little bit more challenging because that means IT needs to perform."Franklin recalls when he was with IBM, he met with some CEOs to discuss major technology trends, and got the response that IT was a "second order issue"."It is a code word for 'I have no idea about it', so it becomes a second order issue," he says. He is adamant CIOs must have a seat at the top table. "They are an essential part of the executive team, he says. "I have seen many IT people who are part of the finance team, or the property group. The IT person is really critical because you [either] have got a clunky IT system or you have got something which works."When CEOs tell him that they have too many people reporting to them as a reason why IT is reporting to another executive like the CFO, he advises them to change the structure. "Have the important people report to you," he admonishes. "You can have one to three persons in operations reporting to you but you need to know how the rest of the business is going to work -- how do you look after your people (HR), your technology (IT), and what is going on with the money (finance)."<strong>From contract negotiation to IT</strong>Van der Westhuizen is from the growing breed of CIOs who have a business, rather than technology, background. Before he and his family migrated from South Africa to New Zealand, he specialised in contract negotiations.That was 15 years ago, and he considered the move as a "late OE" or overseas experience for him and his wife. His first local position was as contract administrator at Mercury Energy. He moved to IT when Vector and Mercury Energy split and he became project manager -- information systems at Vector, eventually becoming CIO, with the title GM information technology.He admits negotiations are almost like a "hobby" to him, and that his children sometimes "run away" when they walk into a shop and he starts talking to the seller. "They know how these conversations go," he says, smiling. When he moved to IT, he saw some advertisements for jobs that would have used his skills in contract negotiations, but he decided to stay put in ICT. "I have started a new career," he says.Franklin describes a useful exercise conducted at Stevenson to underscore the role of IT in the enterprise and introduce some of the changes that are planned. The heads of the different businesses were asked to draw a graph of the IT systems they were using on the white board. The result, he says, was a "massive diagram". When they showed it to the group, some of the executives added some more items, and told them of spreadsheets they are using on the job.Franklin says it is important to show them the systems they currently have and then van der Westhuizen showed how the systems should look like after implementing the transformation programme. Franklin says the problem is that some people may have "pet systems" that they have been using for years who would say the plan is good "except, don't touch [these] systems".But van der Westhuizen says that in this scenario, "you need to show them the bigger picture."Van der Westhuizen says a key part of IT's job is to educate people. "It is important for IT to tell people what they are doing.""IT's attitude just needs to change," he says. "Mobility is almost a game changer for IT. Anybody who is a user of IT can pick up a device and can start working.""IT can not say 'you can not do that,'" he says. "What IT can do is explain how it will impact security or meet critical standards," and tell staff how it can get to this stage.<strong>IT is like a balloon</strong>As for key issues for CIOs in the upcoming months, van der Westhuizen says, "You need to show the benefit of that change at the end of the day."Do you spend a dollar on a concrete truck, on the tyres or on a PC? Which one will be the best for the company if we need that tyre to make more money we do that. If it is a PC to make money or better processes, then it is the PC.""Since 2008 there has been a lot of cost cutting," he continues. "I think the next stage is this -- where IT can really play a good role is how we can do things better. Let us get rid of the clutter and be very clear on what we want to do."He says an area he is looking at in the next 12 months is the "hybrid cloud model", which applications should be on the cloud and which should be on premise. The "third leg" of this model is mobility."The workforce is getting more and more mobile," he says, and in the middle of this is information security. "The hybrid model is the most appropriate one for most businesses," says van der Westhuizen, but there is no single model and it will depend on the needs of the enterprise. "A CIO needs to be flexible, adaptable to change.""IT is like a balloon," he says. "You make sure the balloon is inflated and then you mould it depending on the needs of your company and your customers. If you want the company to expand, you can just inflate the balloon because your core systems are there. "You can inflate or deflate a balloon without the need to change the inherent structure. The commodity portion of IT should have the same characteristics."
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?”
Sovereign New Zealand has a new CIO, Kevin Leith, who moves to the role from general manager operations at the insurance company.
He replaces Peter Muggleston, who is now CIO of Foodstuffs Auckland.
Enterprise adoption of public cloud services is based mainly on realistic trade-offs and perceptions of risk have been exaggerated, reports Ovum.
Peter Finch has left his CIO role at Gen-i after 10 years after a restructuring of its parent company Telecom.
“I am now a CIO in waiting,” says Finch, whose role was disestablished after Telecom established Chorus as a separate company, and rationalised and centralised many of its functions.
The dual trends of ‘bring your own device’ and the rise in mobile workforce have placed new demands on the IT team, particularly the help desk.
But they can also have a positive impact on the team that has, or prepares for these trends, as demand grows for staff that are able to support the growing number of users of smartphones and tablets.
Tim Campos, CIO of Facebook will share his insights on leading ICT at the world’s largest social network, at the CIO Summit in Auckland on June 25 and 26 at the SkyCity Convention Centre.
The conference, now in its sixth year, is the largest gathering of CIOs and senior IT executives in New Zealand. It is organised by CIO magazine, IDC and Conferenz.
Mike Havill's work takes him across the globe with New Zealand as his home base.
"We really need people to recognise that we are in a fast moving industry and that technologies come and go; new tools, new suppliers and new ways of things come out all the time," says ASB Bank chief of operations Russell Jones. "And in that environment, why wouldn't you rather move around, and develop and grow?"