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CIO Roundtable Part I: Crossing the Gap from CIO to Business Strategist
Part One of a roundtable conversation with Enterpriser CIOs and CIO Magazine.
- Tom Soderstrom, Chief Technology Officer, Office of the CIO, JPL
- Merv Tarde, VP of IT, CIO, Interstate Batteries
- Cliff Tamplin, VP of Technology Support & Risk Management, Hyatt
- Adam Dennison, Publisher, CIO
In a new CIO survey of 100 IT executives, only 18% said they are currently focused on driving business innovation. Nearly half say that identifying opportunities for competitive differentiation is their preferred priority over the next 3 to 5 years, yet just 15% are currently able to focus here. And while 78% rate their knowledge of the business as excellent or good, only 10% report that their companies view IT as a “business peer” today.
Now that IT leadership finally has a seat at the C-level table, why do many still feel they are merely executing on someone else’s plans? What can they do to get themselves out from under tactical imperatives like cut costs – or how can they begin to cut costs strategically? The goal of this roundtable discussion, joined by CIO Publisher Adam Dennison and three IT leaders from The Enterprisers Editorial Board, was to get at the current in-between state of many IT executives and suggest possible solutions to bring them fully into the business conversation.
On Crossing the IT – Business Strategy Gap
The Enterprisers Project: Recent research from CIO is indicating that a lot of IT executives are feeling that they are executing on somebody else’s IT plans and not really on their own. What kind of role do you take in helping to drive your business forward? What could a frustrated CIO learn from your mistakes and successes? And, how are you doing that in today’s often IT-budget-flat environment?
Merv Tarde: When it comes to setting a business plan for the corporation, I’m fortunate enough to sit at the table with the other ten officers, and we set our one- to three-year strategies and plans. We go over those every year, but we also review them once a month. So we spend a meeting once a week with each other and that’s anywhere from four to five hours every Monday afternoon, and I’ll say one meeting a month is towards strategy where we go deep on items, and then the other ones are more tactical in nature, but almost 100% revolving around business activities. So, when you talk about business plans I really don’t create one for IT, but we have a lot of IT involvement in innovation in terms of some of the things that we do with the company to hit our goals and objectives.
Tom Soderstrom: JPL’s CIO, Jim Rinaldi (my boss), proposed and implemented a strategy where we merged the business and IT investment proposals. This has been very helpful. When there is a discussion about budget, the CIO supports sometimes the business IT proposal, sometimes the central IT proposal. This has given the central IT organization the leadership position of how to implement the budget that incorporates IT, and it’s always focused on the business problem we’re trying to solve – never on the IT itself. We also formed several IT-related boards to help evolve IT decisions. We have a customer advisory board; we have a technology advisory board; we have an IT architecture board, etc. Those boards are very carefully populated with business leaders or influencers so who understand and can impact where IT is going, which helps drive better business decisions. In the end, when the CIO articulates the list of priorities for IT, it is informed and supported by the advisory boards.
Cliff Tamplin: We have customer advisory boards, as well, for each of the various elements within the organization, and that works very well. One of the biggest challenges that we face is one of education – what we loosely call the iPad Effect – in that we’ve got a situation where every one of the various people who has an iPad thinks that they know how to run IT better than IT, and the fact that they can just go to the app store and download an app, the assumption is basically a speed mismatch between the expectations of what people see that they can get versus how long it takes to deliver something that is actually focused on a very specific problem. So our management philosophy is we succeed together or fail alone. That being said I’m not sure I quite go along with your original statistics that you mentioned at the beginning that are coming out of the survey.
TEP: You think they’re too pessimistic?
Cliff Tamplin: Yes, I think that might be another IT thing where we tend to be very hard on ourselves. When I sit in sessions that are truly focused on various elements of the business, they tend to be far more tolerant and accepting of the errors within their own organizations. And then we probably beat ourselves up probably more than we deserve.
On Identifying New Technologies and Technology Models
TEP: To build on what you’re saying, Cliff, since you’re in a very customer focused business – hospitality – how do you work to identify new kinds of technology practices where IT can even take the first step and lead the way? Are there best practices that you can you can suggest to other IT leaders in terms of getting ahead of and knowing what the right things to pursue are?
Cliff: Certainly I spend as much time as I can actually out in the field, but I have 500 properties and I take every opportunity I can to actually get out and talk to the general manager and the people actually working at the hotel. I guess that applies similarly to previous industries I’ve worked in. You’ve got to get out and talk to the people for two reasons. One is to find out what’s actually going on. If you don’t get it from the people who are actually trying to use what we put out there, you don’t get the real story at all. Also, that’s the way that you can find out what will help them do their jobs better. And, back to the point, if your idea comes from somebody out there where it actually runs up through that chain then it carries a lot more weight than if it’s us just saying “Hey, we’ve got this great new idea.” Pull is always better than push.
TEP: Tom, you’ve mentioned that you have a SMACK acronym about Social, Mobile, Analytics, Cloud, and Key Disruptive Technologies as part of the next IT decade, so it sounds like that’s part of your daily practice to keep on the cutting edge of what’s coming in terms of IT that you can use and bring into JPL especially from the BYOD kind of movement, right?
Tom Soderstrom: It’s much more than BOYD. The strategy here is to know and inform about what’s coming in IT, and to create a pull as opposed to a push. One way we do that is to first talk with the everyone, including the executives about emerging technologies, often words that they haven’t yet heard, like “cloud computing” was six years ago. These technologies frequently evolve outside the enterprise environment and we work with the leading vendors as early as possible. If we can read the trends correctly, prototype the new technologies, and have a new service operational when it reaches critical interest, it’s a guaranteed success. Why? Because it will be intuitive since people use it at home; there will be no training necessary; and users will be satisfied. One simple example is YouTube. When YouTube really took off, we had JPLTube operational inside that looked almost the same, worked almost the same, but is safe to use inside our firewall. And in five years we’ve had three help desk calls. So, by looking at the next IT decade (the next three years), everybody is interested to hear what’s coming next, IT can show the leadership, and we can solve our business problems in innovative ways.
TEP: Merv, you have a strategy that’s been very successful of placing IT physically into the business unit environments for new projects. What kind of role is IT playing there in looking at new technologies, up and coming solution areas that can help drive the business forward?
Merv Tarde: It depends on the problem that we’re trying to solve within the business, but first of all there’s always a business leader, and you can look at them like a program manager. They own the project as a whole and we work alongside of them. We’re like consultants, and we provide opportunities to innovate in several different ways, but we do it according to the architecture that we want to go forward with long term rather than having a bunch of point solutions everywhere. We do run similar types of prototypes with different types of projects depending on if it’s very expensive, then, yeah, we’re going to do a prototype first and if it works, great, we go forward. If it doesn’t, we bless it, bury it and go on to the next opportunity. We always try to take the IT people in these large projects and put them in the business so they can live and breathe it every day. They still have a home back here in IT, but they live there on that project, and I always make sure, too, that the IT manager, whether it’s a manager, director, VP, whatever are very close with their counterparts in terms of forming a relationship so that both of them are responsible, not one or the other. We have been very successful here, especially with our latest project, an analytics project, which was almost a two-year effort. And now it’s just ongoing enhancements where it’s under an Agile methodology so we’re putting things out every three weeks.
Adam Dennison: I think that’s interesting. And I don’t mean to veer off topic here, but Agile is a topic that I’ve heard about I maybe six, seven years ago. It was quiet a little bit and now it’s back. I think you said three weeks between releases, Merv, and I think that’s important because it’s the biggest disconnect that comes from our State of the Enterprise research that the Computerworld brand runs. Specifically, the three biggest disconnects right now between IT and the business are speed of deployment, mismanaged expectations around business outcomes of IT projects, and security. Are you guys hearing more around Agile as well? Should we be prepared for that to be more the norm now in great companies?
Tom Soderstrom: I’m glad you brought that up. Agile is a big deal for us. As we also innovate in things like project management, one challenge is watching the start-ups move so quickly and we sometimes appear to move at glacial speeds. Agile is something we’ve implemented in pockets and we’re pushing it forward, because Agile really works. The biggest impact is that the customer gets so integrated into the process. They frequently sit with the developers and together we rapidly redirect priorities, but now it’s not an IT decision but a joint business decision. We are seeing Agile not just at JPL but also at other companies we work with, large and small. It’s definitely continuing into the next IT decade.
Merv Tarde: We’ve used it now for probably the last three years, but mostly in the analytical area, where now we’ve moved it into our other business area also. When you get to projects like an ERP upgrade it’s still a waterfall approach, but what we did is to make sure we were delivering on milestones every three to four months. So there was a list of objectives that people knew that were coming out, they were due for production, they were trained, all the material was out, and we did that every three to four months so it was similar to Agile. With Agile it’s strictly every three weeks. And I agree with Tom, we got the business so highly involved that they’re the ones saying, “Ok, what’s next? What’s next?” It’s a pull mentality. They want as much as they can get as fast as they can get it.
Adam Dennison: Do you also try and extend Agile through to your customers, or does it stop with your internal customers in your business?
Merv Tarde: This particular project was both internal and external, so we were delivering this as analytics to our Home Office and every one of our distributorships in our network, of which there are close to 300. And they, compared to some of the other systems we’ve delivered to them, which were, “Yeah, we’re going to get them to you in about a year from now”, this was more they could get something new every three weeks, and it was impressive.
Cliff Tamplin: I thoroughly agree. We tend to split it in similar ways to what you just described, so things like e-commerce and the BI tend to be on the Agile side, very responsive time, see how it goes, same thing on the ERP being waterfall. It’s an 18-month project to completely reinstall a whole Oracle suite so that’s not something you do Agile. Like a consultant I would say, “It depends.”
In Part Two of this conversation, we discuss:
- Thriving with a flat IT budget
- CEO or line of business: Who enables the CIO as a strategist?