MIT: CIOs should focus on fewer items

Chief information officers need to learn to cut costs and streamline IT operations so they can better present a "rock solid" business case to management.
Written by Victoria Ho, Contributor

SINGAPORE--CIOs in the region have to prioritize specific portions of their IT operations so they can present a "rock solid" business case to management, in the face of the current economic uncertainties.

Peter Weill, chairman and senior research scientist at the Center for Information Systems Research, MIT Sloan School of Management, said CIOs must learn to consolidate systems so the IT department can "do fewer things better".

CIOs who are focused on these goals are able to see their projects holistically, not as individual investments. "Non-IT savvy companies embark on an IT project and finish it. IT-savvy ones embark on projects that are part of a platform--like lego blocks.

"At the end of 10 projects, there has to be a larger picture formed from them," said Weill, in an interview with ZDNet Asia.

Weill, who was in town to speak at a Microsoft-hosted CIO roundtable, said CIOs in Asia tend to be more hands-on with projects, which may sometimes lead to siloed projects because these IT chiefs are less focused on the broader, business picture, but on the projects themselves.

"With systems built as independent silos, you end up spending a lot of energy and [run up] the IT budget running those complicated projects.

"What works really well is strategic experimenting--if a project doesn't succeed, kill it quickly. If you don't, you will end up with a host of zombie projects," he said.

According to an MIT research paper released in March on CIOs globally, the average firm spends 68 percent of its budget running current systems. An "IT-savvy" company spends a lower 50 to 60 percent instead, by "consolidating the spaghetti" projects, said Weill. This frees up almost half of the budget to pursue new projects, he noted.

Dan Chrysler, enterprise marketing director, Microsoft Asia-Pacific, said companies can take advantage of existing platforms by refocusing them toward business processes.

He offered the example of Thailand's Thammasat University, which consolidated its combination of paper and digital databases for auditing purposes. By putting the data through business intelligence analytics to output school performance and operational information, the school reduced the time to audit by 77 percent.

Businesses more optimistic in Asia
As the economic crisis comes to a head, Asian CIOs may have an easier time than their Western counterparts.

According to Weill, an "overwhelming majority" of the CIOs present at the roundtable said budgets would be up next year, with a handful reporting theirs would be flat. "In the United States, budgets are flat at best. There is a lot of optimism in Asia. There was a lot of conversation around how IT can help, not cutting IT budgets," he said.

With budgets staying buoyant, CIOs can therefore streamline operations and use the additional time afforded to them to perform more business tasks.

MIT's survey revealed that CIOs worldwide spend 10 percent of their time with external customers. CEOs surveyed said they wanted that time to double at least to 25 percent.

"This shows the role of the CIO is evolving; it is not just to deliver IT services well. They have to think of other areas and their time with external customers," said Weill.

This evolving role of CIOs places them in good stead with gaining management buy-in, Weill noted. Those who optimize systems with the business in mind are in a better position to move IT from being an "order taker" to a strategic role.

"Put increased emphasis on fewer things, so you can have a rock solid justification for IT," he said.

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