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Fall 2012

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Why CEOs still see technology as separate from “the business.”

By Martha Heller

Martha Heller is president of Boston-based Heller Search Associates and former managing director of CIO magazine’s CIO Executive Council. Adapted from The CIO Paradox: Battling the Contradictions of IT Leadership (Bibliomotion). ©2012

I have spent an inordinate amount of time thinking about the word “and.” You would expect the word to function as a connector, to imply the togetherness of two entities, like “mom and pop” or “spaghetti and meatballs.”

Yet the phrase “IT and the business” does not work that way at all. Rather, the “and” in “IT and the business” connotes separateness and difference, an us-and-them perception that has plagued IT organizations since the beginning of their existence.

We don’t say, “finance and the business” or “sales and the business” or even “HR and the business.” Why is it that IT alone is treated like an outsider?

If we get out our history books and look at what traditionally causes one group to push another to the margins, we typically find a healthy dose of fear and ignorance. Clearly, there is something about IT that causes uncertainty and confusion among members of the executive committee. CEOs, who have typically done stints in finance, sales, and operations, have never run IT, and they do not understand the function, its tools, its staff, or, most importantly, where all that green money goes. This lack of understanding makes CEOs fairly uncomfortable with IT and predisposes them to separate themselves from it.

Hence the paradox for chief information officers: You are intimately involved in every fact of the business, yet you are often considered separate and removed from it.

“We may have a seat at the table, but we have not gotten as close to the table as heads of HR and finance,” says Colleen Wolf, CIO of Ventura Foods. “Salespeople understand finance, and finance people understand HR, but no one fully understands what IT actually does. So we are on an island.”

Will the scenario change when our current generation of business executives retires and makes way for a new generation of more technically savvy leaders? Not necessarily. “In many ways, consumerization is making the situation worse,” Wolf says. “Everyone understands what it takes to download an app, so they think IT is easy. When in reality, IT is just getting more complicated.”

But the culpability does not rest with solely with “business” leaders. There are still a decent number of CIOs—and I meet them every day—who exacerbate the us-and-them divide. As an executive recruiter, I am often hired by companies to find a replacement for the sitting CIO because he is not working out. Usually, there is some pressing reason, like a global single-instance ERP program run amok, but that is merely the proverbial straw that broke the CEO’s back. When I interview this frustrated CEO, she will describe a scene where all of the executives are sitting at one end of the table discussing corporate goals with a shared understanding of how their business works. And far at the other end of the table sits the CIO, with a propeller on his head, spewing SOA and cloud and banging away on his iPhone.

I cannot tell you how many times I have been asked to replace a CIO who cannot build relationships with his executive peers and cannot inspire trust in the IT organization. It happens all the time.link2

Why? Why are companies still dealing with this issue? How many articles has CIO magazine published about speaking the language of the business, building relationships with business leaders, being a business leader first and a technologist second? While a huge group of CIOs get it and are bona fide business leaders, another huge group does not.

Doug Myers, CIO of Pepco Holdings, a regional energy holding company that provides utility services to nearly two million customers, has his own theory about this chasm between the business and IT. “Think about it. IT people have a different language, we have specialized training, our job descriptions don’t resemble business job descriptions, and neither do our titles,” he says. “And because our skills are transferable from one industry to another, we can fall into the trap of thinking of ourselves as IT professionals, as opposed to industry professionals. In many ways, the gap between the business and IT is natural, and to reduce it, we need to battle the natural order of things.”

Battling the natural order of things is akin to rolling a boulder uphill. But battling the natural order of things—including trepidation about the unknown, an innate distrust of technology, and a desire to keep things as they are—is probably the most constant part of the CIO’s job.

What They Want—and Need—to Know

For every CIO who bows to the natural order of things by walking and talking technology and separating herself from the business, there are many who do not. These CIOs tell me that the concept of “IT and the business” drives them up the wall, and that through a number of changes, both semantic and operational, they have removed the separation between IT and the business and now live together as one. In other words, when it comes to the divide between IT and the business, they have broken the paradox.

When Leslie Jones joined General Instrument as CIO, she walked into an organization where the CEO viewed IT as one of the company’s biggest problems. Senior management spent a great deal of time lamenting the IT organization’s performance, management, and direction. As the new CIO, it was Jones’ job to fix the problem.

The first step: scaling back upward communications. Jones’ predecessor, as did every functional leader in the company, had produced a weekly report for the executive committee. The IT reports were eight-page chronicles of the company’s latest technical updates, stuffed with technical details. “Nobody cared,” Jones says. “So I cancelled those reports and put out a one-pager that clearly stated what got done that week. It was very simple—and very short.”

Battling the natural order of things is akin to rolling a boulder uphill.

Immediately after sending out the first one-pager, Jones received a note from the CEO saying that hers was the best IT weekly report he had ever seen. “All I did was extract the most important information from the pages and pages of techno-talk,” Jones says. “I only told the business what they needed to hear.”

This seems pretty straightforward: Tell the business what they need to know. And yet I continue to hear from CEOs that their information chiefs cannot deliver a presentation without obscure acronyms. Why do so many CIOs give in to the compulsion to use rich technical detail in their communication, even when they know they’re alienating much of the intended audience?

As a recruiter, I have interviewed a tremendous number of CIOs, and I can assess communication skills in the first ten minutes. I ask candidates to tell me about a recent accomplishment, and they typically answer in one of two ways: Either they talk about organizational transformation or business goals or new revenue, or they take me, step by step, through the details of their technology portfolio. Happily, there are more candidates in the first group than in the second, but the second is still sizeable.

Part of the problem may stem from the fact that IT is deceptively difficult to manage and, therefore, underappreciated. Successes are invisible; mistakes are not. As Bechtel Group CIO Geir Ramleth puts it, “Being a CIO is like being a goalie. No one knows your name until you let one in.” Many CIOs believe: “You only think about me and my team when something goes wrong, but we are working really hard all the time, and I need you to understand that.” Hence the pages and pages of technical detail that fill CIOs’ reports.

Jones has gotten over the need to “show her work.” “I’m not interested in discussing how it hard it was. I’m not interested in discussing where we are on things. I’m not interested in discussing how we did it, because from a business’s point of view, that is uninteresting,” she says. “The only thing worth discussing is the result you produce for the business.”

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