Many chief information officers are in a bind, with company leaders demanding that CIOs have both world-class business sophistication and the technical chops one would expect.
This set of complex expectations creates a challenge for CIOs, because very few people bring together deep ability in both business operations and technology. It's obvious that the training and career paths of operations and technology are dramatically different.
To address this challenge, I recommend that CIOs must embrace team-oriented, portfolio thinking in how they manage people, strategy, and technology. The portfolio approach recognizes that modern IT is a strategic business function that uses technology as an operational tool to support broader business goals. Frankly, any other view of IT is archaic and outdated, reducing the CIO's value and relevance.
Importantly, do not confuse this approach with the notion of two-speed IT or bi-model IT. The two-speed approach creates an IT caste system, in which anointed, higher-skill workers focus on innovation, while lower-skill personnel performs maintenance and other operational activities.
The team-oriented portfolio approach views IT as a wheel with spokes, each of which is necessary for the complete functioning of the whole.
My thinking on these points crystallized during episode #291 of the CXOTalk series of conversations with the world's top innovators. On that show, I spoke with Arthur Hu, who is the global chief information officer at Lenovo, which has $45 billion in revenue and over 55,000 employees. The company is currently number 240 on the Fortune 500 list.
During the show, CIO Art Hu describes how he manages a large, globally distributed IT organization. His thinking very much aligns with the portfolio approach I described above. He also explains the limitations of two-speed IT and how he overcomes those issues.
One crucial point stands out from this entire conversation: Hu defines IT success in a single question, asking, "Did we strategically move the needle?" That sure seems right to me.
It's a great conversation and worth your time to watch! Check out the video above and read the complete transcript.
You can also see edited excerpts from the transcript below.
As global CIO at Lenovo, what is the scope of your responsibilities?
Arthur Hu: One facet is what we would call more on the run and grow the existing business, and I'll talk about why I put those together in a second. The other is really about transforming the business. Digital transformation, of course, it's hard to receive a journal or a newsletter that don't mention those words. But, that is also the other aspect of the role that I focus heavily on, which is around digital and business transformation.
Read also: Windows tablets through the ages
On the "run the business," I think that's pretty self-explanatory. I think everyone who is watching today would understand in making sure, in the data center, your hybrid cloud is running, email is running, [and] security incidents are being managed.
I think it's really on the "grow and transform the business" that's quite interesting because there is a lot of net new content, which is very different than keeping the business running. It's an entirely different set of interactions and different problems to go tackle and solve.
What does "grow the business" mean at Lenovo?
Arthur Hu: I think this one also is in two parts. One is about growing the existing business. On that aspect, because it's fairly well understood, there it's about how do we provide better capabilities, more efficiency, better experience for known product lines, known offerings. In that sense, the solution space is much more around something that's much better understood. It's something that the company already had a competency around. Therefore, they tend to be more linear or incremental.
The other aspect around growing the business is on what I just mentioned in the digital transformation. That's where some discontinuity or areas where we're not so good today, or we're trying to grow into, or we're trying to learn about whether there's a fit on something that we could make a difference and bring value to the market. On the digital transformation side, that's the other aspect, and that's marked by, as I mentioned, discontinuity because it's not something where it's as clear, necessarily, what you have to do right out of the gate.
What is the role of the CIO in digital transformation?
Arthur Hu: It requires melding technology fluency with business insight, I'm looked at as the person who brings that to the table. The business teams are looking for someone who can bring the combination of technology and insight and meld it with the business problems to find something that we can talk about together, that we can unlock new possibilities.
Is the key combining technology and business sophistication?
Arthur Hu: Yes. I think that's one of the keys. If you bring just the technology background and you start talking about it in those terms rather than framing it regarding business outcomes or business hypotheses that we're trying to test, it just goes over their head, and it doesn't stick. You become less relevant to the discussion.
Has it always worked that way at Lenovo?
Arthur Hu: In 2005, when we closed the initial PC division acquisition from IBM, we immediately embarked on building a global platform. And so, right from the get-go, it was clear that to become a truly global company rather than one that was just China-focused and had some rest of world business, to become a truly global company what happened was technology out of the gate was very important. It was one of the board level items and seen as a critical path as part of making the integration work. It wasn't just the organizational integration, but also the technology and process integration. I think that's carried through,
We've also had ups and downs. It's easy for technology to be taken for granted or fade into the background. For right or wrong, but one of the things of which I'm a beneficiary is that Lenovo has had periods in its more distant past where technology was off track, shall we say, in a very high profile way and that, as a company, we figured it out.
Read also: Laptop Deals - CNET
When we say IT or the systems are off track, the real statement is the systems, and the business teams aren't coming together in the right way. And so, I think, very early on we figured out if we don't have the business and the technology teams talking, working together very closely, it just doesn't work. That kind of culture and awareness has, I think, for the better, stayed with us through today and it's something that helps the discussion for the leadership team to have that awareness of how critical it is, especially on digital transformation. It's not just the financial system or the ERP systems, but it's branching out. There's no place that the technology enablement isn't anymore.
Why do you explicitly connect IT architecture to the broader strategic goals of the business?
Arthur Hu: [Doing so] forces a discussion about how to build that bridge between what enterprise architecture and technology architecture. That sounds far away from being market responsive and agile in the business, but it's not, because we see that those things directly impact our agility.
If we frame it in those terms, you have the business, in a good way, caring about, "Hey, how is that architected? Is that loosely coupled? Why does the critical path run through that particular integration gateway? Doesn't that slow me down? If that slows me down here, shouldn't we think about refactoring?"
I have business leaders proactively coming to me and talking about things like a shared architecture and how we can make things as part of the API economy, and things should be service oriented. Things which would be an enterprise architect's dream from four or five years ago.
If we can respond more quickly, that translates directly into better time to market. That's something they care about, and that's how it becomes very relevant.
How did you handle technical communication with business people?
Arthur Hu: This has also been an iterative journey for me.
By calibrating around and understanding what the business problems are, I've been able to put on different hats. It's something that I'm on my teams constantly. If we're within an internal hardcore technology and architecture review, then it's okay to have your very technical hat on because that's what the situation requires.
But, when you walk into a business meeting where someone has a very different lens about what they care about, that hat goes off, and the other one comes on.
And so, I think, through just iteration, which is a fancy way of saying trial and error, I've been able to figure out what is the level of engagement, and it varies by stakeholder. There's not a one answer fits all. Over time, you figure out what's the degree of technology speak that you can use and still match, but ultimately still linking to business outcomes. One stakeholder might care a lot about standardization of processes, and so you can talk about how a shared service architecture makes that easier to deploy and how they can run a global structure rather than run parallel geo-based or segment-based structures.
You have helped guide your IT team to become what I call digital IT?
Arthur Hu: I think of it as more of an expansion because transitioning feels to me like you're leaving that behind. I've tried to establish something that's inclusive for my team. I think that's important because, just going back to where we started, even if you're a digital CIO and you would want to apply that label to yourself, you don't get relief from running the business. No one is going to be like, "You're a great digital CIO but, man, my private cloud crashed, and it's been down for longer than you committed in your SLA."
In my view, for the team, it was very important coming from a history of having worked in that model for a long time and very successfully. There's nothing wrong with it, per se. And so, the framing that I took with my team was, "That's great. Let's not lose the discipline around execution and operations that get us here, but we need to widen our horizons. We can't just do that."
Sounds like the concept of "two-speed IT"?
Arthur Hu: I try not to get caught up on terminology. In my context at Lenovo, I knew that calling it two-speed -- and we had experimented with bimodal IT and two-speed IT. People were like, "What am I? I'm always stuck in the low here?"
For us, it wasn't. Other companies I know call it bi-modal IT, and it works fine, or two-speed IT, and that's fine. For our cultural context, the message for people was, "I can either be like the low speed or the high speed," and so, for us, it was inclusive. It was multi-speed. Find the right speed. By the way, you can also have the flexibility in your choice of technology and deployment to find the right speed for the business at that given point, so you're not locked in.
How do you drive communication among teams?
Arthur Hu: If we start at the leadership team level, even though I knew we wanted to communicate, communicate, communicate, one thing I underestimated was it still takes time for concepts to soak in, especially new ones. You have to A) be consistent in your core message over time, but B) explore different ways of saying it because, again, different messaging works for different people.
Read also: Why CIOs have bigger IT budgets for 2018
The second bias that I've had to fight, even for myself, is that it's not technical work. I'm an engineer by training. I'm a computer science major. There's this kind of overhang in my mind that I have to actively fight that says, "If you're not doing something that's more technical, that's not as high value-add." Nothing could be further from the truth, especially when you're thinking about enterprise technology.
My teams also have that where they think, "Oh, I should be writing code, doing an automated test, or scripting something all the time." If you forget the change management aspect, if you forget to communicate about what you're doing, then you fall into the vast majority of projects or initiatives that fail to deliver value because no one knew what you were doing.
Here, the litmus test that I'm imposing is, because, when I came on as CIO, I kind of went on a listening tour. I found that a lot of our business group presidents, they couldn't name even one thing that we were doing that mattered to them. [Laughter] Then, you see the importance of communication. You can be busy all year but, if our board, if our CEO and executive committee couldn't name the top three things we've done for them, then we failed. We're not putting our effort against the things that are most important.
It is incumbent upon the CIO and the team to help the business teams understand what we're doing, and course correct because maybe you do find out and, we did, find out we were doing too many projects. We had a long tail of projects that, quite frankly, were consuming effort without making a big difference to the company. And so, we took portfolio management actions as a result.
The metric is, "Did we strategically move the needle?" not, "How did I resource projects number 125 through 249 on my list?"
What advice do you have for making the transition from traditional CIO to digital CIO?
Arthur Hu: The first thing I would start with listening.
What I mean by that is, it's taking a page out of design thinking. But, design thinking, if you boil it down further, it's really about empathy. I think we're very good in technology at packaging fundamentally simple things into things that sound a lot sexier, but design thinking is really about empathy and empathy starts with listening.
One of the things I found most helpful at the start of my journey was a listening tour. I went around to all the executive committee. I went around to all the geo presidents. I went around to all the senior stakeholders and just sat down.
Now, I was bursting with ideas, so I could have easily just said, "I've got these 25 ideas -- and one, two, three, four, five," and kind of just swamped them. But instead, I just asked them, "What do you see IT or the CIO organization as doing? Where have we done well or not, and how can we partner?"
Listening is the first step in building trust because I think the business said, "Huh. He's willing to listen." From that, that is a willingness. Listen means that people are willing to have a dialog with you. Then once you start having a dialog, that's where you can start to bring all these ideas you have and put them in place, not from your perspective in order of operations, but relevant for the business.
As you start to deliver, not only do you feel better; the business feels better. They say, "Oh, we're doing things together." I think that's also been an important aspect.
Previous and related coverage:
Software runs our companies and lives but remains complex, hard to buy, and expensive to implement. Two top industry observers offer important observations and advice for buyers, vendors, and technologists. Watch for the special advice to avoid "profiteers and charlatans!"
Read this in-depth discussion with Deloitte on new research into diverse technology teams. Learn from the CIO of Fox Networks, who was previously CIO of Burberry, and learn key lessons on achieving high-performing IT.
The chief information officer explains how technology is transforming its core business and related services. This inside look offers important lessons to anyone interested in digital. He also reveals secret truths behind the "close door" button.