Lessons from Land O’ Lakes CIO on how to organize IT for innovation

Lessons from Land O’ Lakes CIO on how to organize IT for innovation

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January 10, 2017
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When Land O’Lakes, Inc. shifted its focus to growth and innovation, my team and I immediately identified that the way we measured success in IT would not enable us to deliver on our enterprise’s changing objectives. Our organization was built to do a few things well: maintain operations, make incremental improvements, and reduce and contain costs. But cost is one of the least important measures when you’re talking about innovation. We needed creative ideas, new projects, and quick turnarounds. In 2011, when we were challenged to change, we suddenly needed to excel in completely new areas.

As I evaluated my organization’s strength and weaknesses, it was pretty evident that we did not have the systems, processes, or people in place to facilitate the 180 degree change in expectations across our entire IT organization that was required. After getting alignment on what we wanted to achieve with our enterprise leadership team, we set up separate groups within IT that were dedicated to turning this vision for innovation into a reality.

We needed creative ideas, new projects, and quick turnarounds. In 2011, when we were challenged to change, we suddenly needed to excel in completely new areas.
It was important to keep groups separate for a number of reasons. First, it allowed my business peers in leadership to have faith that the IT organization could deliver in new, innovative areas where we placed more value on talent than cost. I also wanted to continually remind the rest of the business that while my budget was increasing, it was to go after new digital, revenue-generating opportunities, not because some server or network connection cost us more than it did in the past. In fact, it’s usually the opposite. My IT operations continue to be reduced each and every year from a unit cost perspective, and that’s creating fuel for investing in new and innovative approaches across our digital landscape.

How IT supports direct digital revenues

One exciting example of our innovative change and how it supports the generation of direct digital revenues is our WinField® United AnswerTech™ program. We’re the largest distributor of IT to America’s farmers and America’s agricultural retailers. Our company is out in the field, selling and distributing technology products that we’ve developed in-house as well as numerous third-party products. This relatively new revenue stream is based on the sale of these proprietary and third-party products.

While IT doesn’t currently operate our own P&L, I have individuals who are aligned directly and full-time to the P&L objective of AnswerTech™, which is a product line within our WinField United branded business. These are people who are focused on innovation and product leadership. We’re working hand-in-hand with the business and marketing leaders to develop these products and to improve them each year, both technically and functionally. It’s a continuous improvement, agile model for ongoing product development. I measured the IT personnel focused on this effort on revenue generation and market adoption, in addition to their own personal delivery on the technology.

Shifting talent needs and cultural concerns

Revenue generation requires a different type of leader than a typical project manager. We identified early that we needed product managers in IT. To meet these shifting talent needs, we either developed or brought in the highest-caliber talented people we could find. We looked for people who knew how to do project execution, had a great business sense about them and had a unique ability to influence business leaders. We looked into startups and big software companies that had product leadership. As we’ve matured, we now work hard to develop our project managers into product managers.

We started this effort six years ago based on one visionary product. Fast forward a bit and now we’re up to six proprietary products, and we’re reselling about 15 others, all experiencing significant growth each year. In all, we have about 21 software products were delivering to the marketplace.

Product development, management, and product leadership aren’t for everybody, but neither are systems operations, network administration, or data center management. We need all of these roles to thrive as an IT organization

Managing through such a dramatic change in expectations within the IT organization was a challenge. Initially, some of our employees didn’t understand why the new organization had been established. Some people wanted to be involved but wanted to focus on implementing our enterprise IT governance processes across our innovation portfolio. We had to work hard to protect a lot of our early, innovative development from our own operational success. As we've matured in our efforts, all parties have come to realize that we’re all working toward the same end goals – we just all have different roles to play and participate at different times in the lifecycle of a product.  

If people want to work in the innovative areas, then they’ve learned that they're going to have to refine their own skills, raise their own expectations, be comfortable taking personal and corporate risks, and invest further in their education. If they’re happy where they are and decide that this level of risk isn’t for them, we still have more traditional IT roles as well.

My personal epiphany happened when I realized that the fundamental metrics by which we were measuring IT were completely at odds with what was needed for innovation. Once we separated those organizations, and then looked at the talent needed to achieve the goals and objectives of each group, it became apparent that not all IT talent is the same. By separating the IT organization into these differentiated groups, we’ve allowed people to thrive in the areas that they’re most passionate about and focus on their own personal development.

Product development, management, and product leadership aren’t for everybody, but neither are systems operations, network administration, or data center management. We need all of these roles to thrive as an IT organization and ensure our company’s success, and we need to work as an integrated team to ensure that everything comes together to create solutions that are nothing less than magic.

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Mike Macrie assumed the role of Senior Vice President and Chief Information Officer of Land O’Lakes in June 2013. Prior to this position, he was Vice President of Ag Services IT. Macrie led the transformation of Ag Services technology and the rebranding of Winfield and Purina across intranet and customer sites. Before joining Land O’Lakes, he held a breadth of roles at Ingersoll Rand, AlliedSignal and several start-ups, G5 Technologies and Multi-Media Solutions. Macrie has an M.B.A. from Duke University and a B.S. from Cornell University in Applied & Engineering Physics.  

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