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| Home - Industry Article - Sep 04 Issue |
Business Technology Leadership: What IT Means in the Early 21st Century
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Identify Business Pain & Pleasure
Business technology leaders should see the world through the eyes of the business. They should speak the language of business. But most importantly, they should focus on the pain that business managers feel. The really good ones keep a running list of the most difficult problems – the sharpest pain.
Business pain comes in many forms. Some comes in the form of cost control, such as headcount and overhead cost reduction. Other pain relief comes in the form of improved business response and control, such as improved management effectiveness, employee productivity and supplier relations.
The search for business pleasure should also occupy a leader’s time and energy. Some pleasure includes revenue generation, up-selling, cross-selling, organic growth, acquisitive growth and – of course – increased profit.
The whole pleasure/pain exercise focuses on business success. It also focuses on what individual business professionals will personally find exciting – and rewarding. Leaders understand what makes people heroes, what the organization values.
Figure 3 identifies three paths in the alignment-to-partnership journey. We have to appreciate business pain and pleasure, we have to become more than just credible, and we have to define business value around strategy. If you understand these paths, you can redefine the business technology relationship – redefine it, in fact.
Figure 3: Paths to Business Technology Partnership
Let’s assume that you understand where the business feels pain, and how it would define pleasure. Remember that the business expects technology to reduce its pain – almost always defined around cost reduction. But it’s more than that. Business managers worry about their supply chains, their competitors, their manufacturing, distribution and, of course, their margins. The technology agenda needs to speak directly to their pain points – which, when relieved – can become the sources of wide and deep pleasure. If you become a dispenser of pleasure as you reduce pain, you’re credibility will rise – which will reveal the second path to business technology partnership.
Hopefully when technologists walk into a room the business managers don’t run for cover or – worse – attack them mercilessly for their sins (network crashes, Web site debacles … you know the drill). Nirvana here is influence – defined in terms of how the business thinks about how and where technology can help. Does the business respect you enough to confide in you, to commiserate with you, to invite you to brainstorm about its strategy? Who do you drink beer with?
If you’re influential, you can shape both operations and strategy. If you get operations straightened out, you can spend most of your time – with your new partners – thinking about competitive advantages, revenues and profitability. There’s no better place to work, no better way to spend your time. Leaders seek this partnership, this influence.
Organize Adaptively
Lots of companies are decentralized these days, though the number that are re-centralizing is increasing. The essence of the centralization/de-centralization dance spins around value of shared services. But it’s also about discipline and governance. Many companies have had a difficult time standardizing their infrastructures and processes, so difficult in fact that they’ve resorted to extreme outsourcing.
But the wild card is governance. If your organization is without unambiguous governance your chances for effective organization are pretty much non-existent.
The key going forward is to define the business technology organization as though there’s one – not two – organizations. Below-the-line infrastructure should be managed transparently, almost as though it doesn’t exist. While this is not to say that it’s unimportant (see below for just the opposite argument), it is to affirm its relative unimportance compared to above-the-line projects, programs and impact.
The governance around all this should be clear, consistent and unambiguous. This will be the toughest battle you fight, but once the governance is set it becomes easier and easier to get things done. If you handle governance poorly you’ll find it nearly impossible to organize business technology effectively.
Reporting relationships are always complicated, especially in decentralized organizations. Flexibility is essential, since the business technology relationship is fluid and continuous – not defined around a number of discrete “rules.” This point is important for leaders to understand. In years past, especially when there was relative chaos in our technology organizations, we defaulted to sets of rules and regulations which more often than not were used to hit non-compliers over the head with: in our desire to create “order” we ended up offending our customers! In extreme cases, the business technology relationship was defined around a set of internal service level agreements written to trap clients into draconian consequences for less-than-egregious offenses. This kind of organizational authoritarianism is what explained the lack of business technology “alignment” for many years.
Reporting relationships should speak to business processes. CIOs and CTOs should report to the CEO or the COO, not the CFO, whose incentive is only to hold costs down. CIOs and CTOs should organize their organizations around the five layers, but should also make sure that they organize around hardware, software and processes.
Business technology leaders organize around business processes and – especially – objectives, not around self-contained best practices around, for example, data center management. In other words, data center management, desktop management, storage area network management, and the like, should all be organized purposefully, that is, with a clear connection to the business models and processes that they serve. When problems arise, solutions are sent through business filters first and foremost, and then filters that focus on other factors.
Manage Infrastructure
Leaders make certain that the computing and communications infra- structure works. This means that it’s secure, reliable and scalable. This also means that it’s cost-effective. Leaders understand that there are alternative ways to acquire, deploy and support computing and communications infrastructures. They optimize the alternatives with reference to their organization’s core competencies, culture and evolving business strategy.
The ability to write diagnostic request for proposals (RFPs) for infrastructure technologies and processes, as well as the ability to craft effective service level agreements (SLAs), are two indispensable leadership skills.
Leaders manage their infrastructures cost-effectively. This is the commodity side of the business. The trends are clear here, so leadership will increasingly be about the acquisition and measurement of reliable, flexible and secure infrastructures.
Communicate
Leaders communicate. They understand that the essence of communication (and its cousin, influence) are hard and soft facts, and hard and soft communications skills.
Communication is based upon the wide and deep understanding of your audience and your own specific strengths and weaknesses. Some people are natural communicators (or salespersons), while others find it hard to connect with colleagues or “customers.” If you have natural talent here build upon it through practice, executive education and coaching. If you’re hopelessly terrible at it, find someone on your team who’s an effective communicator and give them the responsibility for your team’s communications duties.
Communication is a continuous process. When things are relatively quiet, leaders still need to communicate what they’re doing, the status of their projects and their strategies. When things are bad, they can call upon a deep continuous relationship with their partners and stakeholders to jointly solve problems; and when things are good, leaders can exploit their communications investments to make sure everyone understands the significance of the victory at hand.
Leaders communicate good news, bad news and no news in a predictable, timely, digestible way.
Much communication is routine – about how well the infrastructure is performing, technology costs, technology total cost of ownership (TCO) models, and the return on investment (ROI) of business technology projects and programs.
Project/program/portfolio “dashboards” are also a good idea: everyone likes easy to read status reports on key projects and whole programs. It’s also a good idea to develop some form of “scorecard” that communicates the overall impact that business technology is having at the company.
Market
Leaders think about who creates, distributes and maintains the technology “message” inside and outside of the company. Business technology leaders are sensitive to the need to internally and externally market their business technology accomplishments and strategies.
So what are the pieces of a good technology marketing strategy? First, consider what you’re “selling.” You’re selling hardware, software, services, image, perceptions and strategies. When everything goes well everyone thinks that the technology people are really pretty good, that things work reasonably well – and for a fair price. If the hardware and software works well, but the image is poor, technology is perceived to be a failure, just as bad hardware and software – but good perceptions – will buy you some time. Like everything else, you’re selling hard and soft stuff, tangible and intangible assets and processes.
Next consider who you’re selling to – noting from the outset that you’re selling different things to very different people. Yes, you’re selling hardware, software and services (along with image, perception and strategy) to everyone, but the relative importance of the pieces of your repertoire shifts as you move from office to office. Senior management really doesn’t care about how cool the network is or how you’ve finally achieved the nirvana five-9s for the reliability of your infrastructure. They care about the 20% you lopped off the acquisition project you just launched, or how company data is finally talking to each other and that you’re now able to cross-sell your products. The content and form of the message is important.
Public companies have a unique challenge. Increasingly, technology is included as a variable in company valuation models. This means that the analysts that cover public company stocks look at technology infrastructures, applications and best practices in order to determine how mature a company’s technology acquisition, deployment and support strategies are. CIOs and CTOs talk to these analysts, fielding their questions and otherwise molding their understanding of the role that technology plays in the current and anticipated business.
What’s the brand of your technology organization? If you were a professional sports team, what would be a good name for your organization? Would you be the Innovators? The Terminators? Put another way, if you asked the analysts who cover your stock to word associate technology and your company, what would they say? Disciplined? Strategic? Weak? What about collateral materials? Does the technology organization have its own Web site? It’s own brochures? Case studies? White papers? Referenceable “accounts” (internal customers who are happy with technology’s services)? Are there newsletters and technology primers? Is there information about the competition?
Is there a technology “road show”? A consistent message about the role that technology plays in the company, how technology is organized, what matters most, the major projects, and technology’s contribution to profitable growth – among other key messages – is essential to running technology like a business.
What Next?
Without question, the nature of business technology leadership is changing. This short article tries to profile the trends and the leadership requirements that will be rewarded in the early 21st century. Hopefully, over time there will be near-perfect synergism between business and technology in your organization.
Steve Andriole is the Thomas G. Labrecque Professor of Business at Villanova University where he conducts applied research in business technology convergence. He is also the founder & CTO of TechVestCo, a new economy consortium that focuses on optimizing investments in information technology. He is formerly the Senior Vice President & Chief Technology Officer of Safeguard Scientifics, Inc. and the Chief Technology Officer and Senior Vice President for Technology Strategy at CIGNA Corporation. His career began at the Defense Advanced Research Projects Agency where he was the Director of Cybernetics Technology. He can be reached at stephen.andriole@villanova.edu or at steve@andriole.com.
 
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