Mark P. McDonaldA few weeks ago, I had the honor of working with the IT leadership team of a $20 billion global company. I was the guest of the CFO and CIO. Toward the end of the first day of the meeting the company’s Chairman of the Board and their CEO joined the meeting. Each spoke for about 15 minutes about the company, its future and what they saw as important in the coming year.
What struck me about their talks was the importance of technology in how they saw the future and the role of IT. Their remarks offer an example of how you would hope every Chairman or CEO would think about IT. For obvious reasons, I cannot tell you exactly what they said, but here is a description of their talks.
They started talking about the company’s recent history and foundation for success. It was a frank discussion using plain language. Next, they talked about what made the company unique and how it was going to continue to win in the future. They talked in terms of the company’s capabilities — what they did better than anyone else. They are a leader in CRM and an emerging leader in analytics. Finally the each talked about changes needed for continued success. They concentrated on the need to deploy these and other key technologies across the company.
At first look, these topics are fairly standard. I have seen CEOs talk with their senior IT teams covering similar ideas.
What was different was the way these two executives each gave that message.
It was clear that both Execs had deep operational knowledge of the company. They quoted operational metrics, pointed out specific examples at the local office level, the need to move practices from one part of the company to another, etc. You knew right away that they were not in the ivory tower. In those remarks they did not talk about IT and the business, only the business and its use of key technologies.
These Execs delivered their messages in stories that covered the situation/challenge the company faced, the options they had, the reasons why they decided on a particular option and why they did not choose other options. Each story was about two minutes.
The way that they talked about technology caught my attention. They used the story structure to explain how they reached the conclusion to invest in technology with a focus on the business outcome. They knew the role technology needed to play across the enterprise. They then pointed out the skills and work IT did to bring that technology into the enterprise. Listening to the stories, you could see their thought process and gain a greater understanding of what they valued and how they made decisions about the business, information and technology.
The business outcome was the focus, not the IT organization or the particular investment project. They never once mentioned the XYZ initiative or program. The program was not important; the technology-based capability implemented by XYZ was what mattered.
During their talk, it became obvious that the Chairman and CEO valued IT for its results not its existence. In taking that approach, they avoided paying lip service or giving false praise. Something other CEOs often do when they talk about the organization rather than its results.
They did more than say, “IT did a great job.” They showed the IT Executives that they understood technology’s value in the company. Based on that value, they reminded IT leaders that they expected IT to push the organization forward based on the capability of information and technology to transform the business.
I believe that is the way you would like every Chairman or CEO to talk about technology because that is the way they talk about every other aspect of the business, using the vocabulary of results and the importance of each part in creating those results.
Category: CFO CIO Strategic planning Strategy Tags: Business Strategy, Business Value, CEO, CFO, IT and Business
1 response so far ↓
1 Philip Allega August 24, 2010 at 7:55 am
A timely posting, Mark. Our research in EA has clearly shown the propensity of most EA practitioners to focus upon the value delivered to the IT budget. It’s a leading set of practitioners that have made the paradigm leap to understanding that it’s the business value outcome that’s important.
Richard Hunter and George Westerman’s book, “Real Business of IT” (see http://www.amazon.com/Real-Business-Create-Communicate-Value/dp/1422147614/ref=sr_1_1?ie=UTF8&s=books&qid=1282654031&sr=8-1) laid out a very strong value path that must be undertaken, and not deviated from, to make the shift from an internal focus upon IT alone to a joint, unified, view of IT and business.
Working with a client in Europe last year, a manufacturing company, I was, like you, struck by the way in which the leadership team spoke about technology and information and business processes and capabilities. For this company, there was no artificial divide of the “IT people” and the “business people”. There were only “business people” in this company.
It may seem a big stretch for many used to years of “us” and “them” and focusing only upon IT operations costs as the key metrics of the IT organization. These examples show, however, that there is a growing legion of organizations wherein IT and business are blending, unifying, and stepping past long time finger-pointing exercises across organizational divides. For some, it may take a little longer to reach such a state; but, that change is coming.
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