At the board meeting of a giant food company recently, a CIO had an extraordinary showdown.
The director of marketing presented his budget, including a recurring item, a 55 million euro marketing campaign in the Baltic region. The CIO challenged this: "What reason do you have to expect better results from that campaign? It has never worked before."
The response was a dismissive "Get back into your box," from the marketing director--who had just finished picking holes in the CIO's budget. But the CIO stood his ground, and pointed out that he was a full member of the board and entitled to take part in all the board's business. An open discussion followed, and the marketing director eventually conceded that the Baltic marketing campaign was one where the company could save some money.
This story is told by John Mahoney, a vice president and research director at Gartner Group. He thinks CIOs will have to stand their ground this way many times in future if they wish to achieve their goals in the enterprise.
Even if the CIO has no desire to build an empire, he or she will have to start picking up on business issues and functioning as an equal member of the board--simply because the board is actually crucial to the next step in his agenda. It is they who are the next target for automation.
In some respects, although technologies keep appearing and systems need upgrading, the actual use of IT has come up against the buffers. Sales forces have been automated, customer helpdesks are in place, and projects are there to roll out things like ERP and so forth.
The thing is, that on a lot of scales, businesses are not changing as dramatically as they were expected to. And there is a simple reason for this. Technology does not change businesses. People do.
Technology is important, as a tool to make things happen differently. But the job it is supposed to change must be defined, and the people who use it must understand what it can do--and want to make the changes that it enables.
In other words, all the ERP/CRM/EAI/BAM systems in the world will do nothing for your company, if the board doesn't buy into them. And they will not buy into anything from the IT department if IT management is seen as a bunch of boring wire-pullers who have no understanding of the business.Businesses should be working towards clear business goals, not technology-based visions--things that can be measured in the real world. Gartner Group's "real-time enterprise" spells this out--as did Gartner's preceding "zero latency enterprise" buzz phrase. It's all about reducing the cycle time--the time it takes for a business decision to be made.
Instead of measuring success on the rollout of technologies, CIOs should take a real figure, such as the time taken to for a customer to buy something, or a bank to approve a loan. Measure how long this takes now, set a target to reduce it by this time next year, and another target to reduce it beyond that.
However, this sort of result implies real changes, which imply real involvement by the board. Which brings us back to the issue: Management has to start using technology to change itself.
Instead of automation, management relies on a "messy e-mail adhocracy," says Raskino. It's a fat and wasteful layer of people performing mundane work unsuited to their caliber and pay. Technologies like IM can reduce this, he says.
However, management won't do anything like this unless it trusts the people selling it to them.
CIOs who are more interested in dealing with wires and boxes will never get that level of trust. They need to progress to what Gartner grandly calls "the chief architect of the enterprise."
I'd settle for CIOs becoming people who understand the business and what they can contribute to it--and have made their colleagues aware of this.
According to Gartner, most CIOs are treated with "skepticism" and grudging "acceptance" by their colleagues. They have not yet reached the dizzy heights of "trust" or "acceptance."
But we have no doubt they will. For someone who has plumbed the depths of security standards and wireless protocols, boardroom politics can't be too complex.
Let's make 2003 the year the CIO took charge.
Do you think CIOs can gain widespread acceptance in the boardroom? TalkBack below or e-mail us with your thoughts.