Now that you’ve had your budget cut to the bone and deeper, you are probably taking each day at a time. “Have the servers crashed? No. Someone just closed my door”. “Here comes the CFO. I guess its time to rekindle my head hunter contacts”.
It’s a stressful time for CIOs. Nerves are fraying. You are bending over backwards to keep the IT function running on a shoestring and your back is starting to hurt. What you need is a vacation.
The sooner your spinning plates start to hit the ground the sooner the boardroom will need to face the reality of indiscriminate cost cutting. One that you have been protecting them from at great personal cost.
It’s better that the servers crash before you do. So take that vacation now.
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Most people acknowledge that IT has a role to play in organisations. Some see it as a cost-management tool, some see it as a mechanism to facilitate communication and a few even see it as a game-changing tool.
A highly competent CIO can deliver all three. But what do we mean by competent?
There is no CIO ISO standard that tells us exactly what skills, knowledge and attitude a CIO should possess? Thus learning and development functions along with their training partners do not know where their focus should be in supporting those in an IT leadership position.
MBAs seem to have lost interest and tend to bundle IT into some overlapping subject such as operations management. Clearly IT is not a draw for our Economist-reading future leaders.
There appears to be two options:
The former will slow up the rate at which business and society harnesses optimal value from their IT investment. The trouble with the latter is that it requires cooperation across countries, sectors and competitive demilitarised zones. This isn’t going to happen in the short term.
Next best thing is to identify role models within given segments. Reverse engineer their competences into a specification and then build the next generation of CIOs in that image. Over time one of these initiatives may become the de facto standard.
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It is not clear to me that many boardroom executives know the difference between strategy and tactics when it comes to cost management. The overwhelming theme I hear from speaking to many CIOs is that the IT budget has been hit both hard and indiscriminately.
This smacks of a knee jerk reaction to the economic downturn. Cost jerking has some short-term benefits, such as quickly bringing costs into line with revenues. Usually such measures are easy to implement and appear to all concerned, apart from the recipients, as action-oriented leadership.
However tactical action rarely addresses the root cause of cost related issues. Perhaps the real issue is the need to migrate the existing business model to embrace the web?
Such tactical action usually takes no account of the associated consequences down the line. But perhaps this is not an issue if the CEO is judged on short-term performance?
Perhaps the CEO is keeping his fingers crossed that an imminent upturn will cloak the problem once reckless spending becomes fashionable again?
Thus shareholders need to discourage business leaders from being a jerk.
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Harvard Business Review recently lamented on how destructive outsourcing in respect of high –tech manufacturing has led to the US losing its competitive edge.
With outsourcing goes the associated skill, knowledge and R&D investment.; usually in an easterly direction.
It seems logical of course to outsource ‘low value’ activity such as the production of chips, routers and PCs. But before you know it the design of such products are also outsourced. And thus the direction in which these markets evolve is then beyond your control.
The R&D associated with these low value technologies goes on to generate the high value-high opportunity technologies such as electronic paper, thin-film solar powered cells and sophisticated mobile handsets.
It would appear that the elastic band of outsourcing is at full stretch with a reversal in trend imminent.
Business-leaders might also apply this thinking to their IT investment. Whilst short term cost savings might be achieved, the associated business wisdom once jettisoned will be difficult to retrieve.
Like many technology terms, virtualisation is one that is likely to keep you out of the boardroom.
However if you can present it as a business concept then you are more likely to get the CEO's attention.
So instead of virtualisation been described as way to eg. reduce the TCO of the IT function, it can be played as follows:
A mechanism that will stop business units from creating competing power structures using the number of servers they have allocated to their unit as a measure of military capability
So now IT paradigms become a source of business wisdom. And you become the business sage.