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Issue of July 2005 
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Excellence through IT

Subhojit Roy, Head, Information Technology, SBI Mutual Fund, believes that it’s crucial for a CIO to have a vision. Backed by a group of achievers, this vision helps lay down the foundation for a world-class organisation.

Like the rest of the top management team, a CIO should aspire to create a world-class organisation. To do so, the CIO must have a vision that incorporates the essential ingredients of financial success and market reputation.

To make this vision a reality, the CIO should lead the IT team aligning its functions with those of the business. Heads of finance, human resources, marketing, and manufacturing functions should also be involved in the formulation of the IT strategy. The vision must evolve from managing the company’s IT systems to reengineering its business processes.

An early realisation

Although I have been the head of the IT department for over five years now, I realised early in my career that in order to play this role one should understand the company’s business well, and be able to integrate business with technology.

That is an ideal role, and unfortunately, it doesn’t happen most of the time.

The CIO must strive to understand business and technology equally well, so that he or she finds it equally comfortable to talk to business leaders and technology evangelists.

Caught in a rut

Today, most CIOs are caught in a rut, running the IT engine. They are busy, either putting infrastructure in place, or managing the infrastructure. This reduces the IT department’s role to that of a support division. As a consequence, the business heads of other departments begin to treat IT as a support function.

A paradigm shift in the CIO’s attitude as well as those of other business heads is required.

Demand for IT

The CIO’s vision mandates the creation of new applications and solutions with the help of other business units.

There has to be a balance in the CIO’s role between that of a strategic planner who innovates various business applications, and a manager of operations. More time should be spent on the first role.

However, the ground reality is that the CIO is busy fire-fighting everyday problems, and has to spend at least 50 percent of his time at it. Therefore, the scope to plan, create strategies, and take business-focussed initiatives is limited.

Business vs IT

In my experience, there are several instances of conflicts between business and IT. Whenever IT initiates and takes up a project, business departments construe it as an ‘IT project’ and decline to be involved leaving the ownership solely with IT.

In any successful organisation, however, business and IT work jointly. The ownership rests with both. CEOs should guide business leaders, and CIOs should look for business heads’ involvement to succeed.

If the business side is not involved, users will complain about the lack of features in solutions at a later stage. This may lead to a blame game. The business input is critical throughout the entire lifecycle including planning and deployment.

The evolving business

Although it’s an old adage that, ‘IT and business should be perfectly aligned’, people still make mistakes. The CIO should talk to the CEO about evolving business plans. This will help in a competitive environment where user demands of both internal and external entities (customers, suppliers) are complex and require proactive behaviour.

It’s important to look at avenues to increase efficiency and reduce costs. After all, the CIO is in the best position to introduce business process reengineering. The CIO’s leadership qualities should be able to garner attention from the CEO and others in the top management.

A visionary CIO’s qualities
  • Should aspire to create a world-class organisation
  • Must have a vision that incorporates financial success and market reputation
  • Involve business leaders in IT strategy-related matters right from the planning stage
  • Should evolve from the role of managing the company’s IT, to the role of reengineering the company’s business processes
  • Create demand for new applications and solutions through technology
  • Avoid potential conflict with unit heads by better inter-personal management
  • Should be savvy in financial aspects of IT

Interpersonal issues

The CIO should have good interpersonal and communication skills to be able to balance in such a 'tightrope' situation. These soft skills are lacking in many of today’s CIOs

When a person steps into the larger role of the CIO, he or she aspires to become a leader in the business side as well. Business leaders may feel threatened that ‘someone else’ is trying to enter into their domain. So, the CIO should have good interpersonal and communication skills to be able to balance in such a ‘tightrope’ situation. These soft skills are lacking in many of today’s CIOs.

Sometimes business users come up with a lot of technology solutions to improve their business processes. In such a case, the CIO should not feel threatened about losing turf. The CIO should avoid any conflict and be able to appreciate new ideas with the help of
appropriate interpersonal skills.

A good way will be to initiate suggestions for IT solutions from the business leaders. Since they understand the operations best and will be the bigger users of IT, their involvement will provide a lot of value.

The visionary leader

To be a true visionary, the CIO should be able to measure the value provided by IT investments. Most companies do not know how to measure the value of IT investments, and since the business does not measure it as well, it may be viewed as a ‘sunk’ investment.

The CIO should be savvy in the financial aspects to calculate benefits to business. This will help business leaders view the CIO’s role in a different context.

CIOs should be able to track the financial and non-financial benefits that IT investments deliver. They can use a few qualitative measurement metrics such as opportunity cost savings, and process improvements.

The expenditure on IT investments specific to a particular area of business can also be clubbed with the cost of that particular business unit. Since every business has a certain cost factor for set-up and operations, the value of IT is justified by the business returns produced by that business unit.

As told to Soutiman Das Gupta

 
     
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