Mark P. McDonaldCIOs face multiple competing factors for their time, resources and attention. CIOs need to choose in 2009, as they do not have luxury of doing everything for everyone. CIOs also face a challenge in how do they organize and marshal the energies and resources of their people. In other words, what should the theme be for IT in 2009 and beyond?
CIOs have a choice in how they define their focus. They can concentrate on internal operations and costs in an effort to “protect IT.” Or, they can achieve cost reduction by raising enterprise effective—changing business processes, applications and IT in ways that sustain performance improvements and recognize the evolving market and customer needs.
Both require the same type of hard work. Holding the line on current costs requires discipline and focus. Transforming the enterprise to raise effectiveness requires that same discipline, as well as measured innovations in products, services and management processes.
The answer seems clear based on the 2009 CIO Survey of more than 1500 enterprises. Enterprise effectiveness is the path to creating value and enterprise effectiveness requires IT effectiveness. The figure below illustrates the connections at a macro level.
As the enterprise becomes more or less effective so does IT. Enterprise effectiveness drives or creates the environment for IT to be effective. Only one in 10 CIOs see their IT organization as more effective than the enterprise. Because the enterprise and IT are so closely connected in this respect, CIOs can take steps to raise the effectiveness of both and in the process establish IT as part of the engine that drives enterprise success.
Focusing on effectiveness makes sense in this environment of volatility and uncertainty where the company cannot control or count on stability in markets, customers or competitors. In this environment, making sure that you are building your ability to achieve your current financial and operations goals means taking control of the only thing you can control – your enterprise.
The good news is that effectiveness pays off for the enterprise and IT. Its clear, measurable, and you can explain it to your business peers. So leading IT in turbulent times is either a game of IT budget limbo – how low can you go, or its mission to restructure the enterprises to raise its effectiveness. You choose.
Category: CIO Leadership Tags: 2009 CIO Agenda
5 responses so far ↓
1 Eric Posner March 13, 2009 at 12:19 pm
How does Social Media play into the effectiveness of the Enterprise
2 Raj Kumar April 8, 2009 at 2:35 am
The relationship between IT and enterprise effectiveness is believed to possess huge potential. However, it has yet to be unlocked. The following two comments of Davenport reveal the failure to harness IT over the years:
2003, CIO: We’ve been experimenting with IT support for knowledge work for several decades now. When will we figure out what works?
2007, HBO: Most of the barriers that prevent knowledge from flowing freely in organizations – power differentials, lack of trust, missing incentives, unsupportive cultures, and the general busyness of employees today – won’t be addressed or substantially changed by technology alone. For a set of technologies to bring about such changes, they would have to be truly magical, and Enterprise 2.0 tools fall short of magic.
That raises the Q: What should be the words of the theme?
3 Raj Kumar April 8, 2009 at 2:41 am
SOME GLITCH HERE. FIRST UPLOAD REJECTED
The relationship between IT and enterprise effectiveness is believed to possess huge potential. However, it has yet to be unlocked. The following two comments of Davenport reveal the failure to harness IT over the years:
2003, CIO: We’ve been experimenting with IT support for knowledge work for several decades now. When will we figure out what works?
2007, HBO: Most of the barriers that prevent knowledge from flowing freely in organizations – power differentials, lack of trust, missing incentives, unsupportive cultures, and the general busyness of employees today – won’t be addressed or substantially changed by technology alone. For a set of technologies to bring about such changes, they would have to be truly magical, and Enterprise 2.0 tools fall short of magic.
That raises the Q: What should be the words of the theme?
4 Mark McDonald April 8, 2009 at 6:33 am
Eric
Thanks for your comment and sorry to get back to you so late,
Social media will play an increasingly larger role in enterprise effectiveness for one simple reason (IMHO) — that effectiveness requires coordinated and collaborative work. Social media as an organizing technology inside an enterprise and between the customer/enterprise and suppliers has largely gone untapped.
Executives cannot see how they would gain benefit by bringing in consumer based media (facebooking myself) as easily as they can recognize the need for greater collaboration.
So I believe that over time we will see companies apply this technology in ways that they have not applied technology in the past. The history of IT has largely been the history of control and exerting control over transactions, data, processes, etc.
The pace of change, the range of change coming will require a degree of collaboration and flexibility that is well suited for social media style applications.
Exactly how this plays out remains to be seen. But the connection between effectiveness and the level of collaboration seems clear.
5 Mark McDonald April 8, 2009 at 6:38 am
Raj
Good thought and it highlights an important element that people often forget.
Companies are social systems as well as technical systems. A technical system refers not just to the IT but also the org chart, the processes, the rules, metrics etc. Technical systems are the focus of management attention and action because they are relatively easier to handle. You make a policy and enforce it.
Social systems on the other hand are all of the behaviors, modivations, the operating culture (what really happens) rather than the corporate culture (what people want to believe happens).
Social systems can be influenced by technical systems, but not dictated by them. You see that in phenomenon as big as the black and grey market economies, down to people who say “I not supposed to do this for you but …” Think of Bob Parr in the Incredibles talking to the little old lady about how to get her policy paid. Sorry a little levity.
So executives, IT professionals need to influence, structure and lead in both social and technical systems as well as recognize the connection between the two.
I have found that connection is the location of much of the gap between enterprise effectiveness and technology spend.
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