I had the privilege of participating as both a speaker and an attendee at one of nGenera’s joint IT/HR Summits in Austin last week on ‘Next Generation Technologies for Next Generation Enterprises.’ These are 3-day sessions where CIO’s and VP’s of HR come together to share and learn about key business issues on their joint agendas. It truly was a privilege to be part of this event which included presentations by Andrew McAfee (Harvard Business School), Don Tapscott (nGenera Insight), David Ulrich (University of Michigan), Tammy Erickson (nGenera Insight) and yours truly. I got a lot out of the speaker sessions, but also found the dialog and networking to be highly stimulating and informative. Inevitably, many of the conversations steered to the global economy and the role of IT leadership in a recessionary climate.
With a nod to Professor John Henderson’s old joke (“there are two kinds of people – those who believe there are two kinds of people, and those that do not”), I did find two sharply divided worldviews among the many engaging CIO conversations I was involved in. I will, with some poetic license, represent those opposing worldviews below. These represent the extremes – most of the CIO’s I spoke to at the event were closer to a middle ground – but examining the extremes may stimulate your own thinking about this issue. What do you believe is the proper role of IT leadership today?
I will refer to the opposing views as Ivan Innovator and Cecil Controller. Here are their contrasting positions:
A recession is a time for the IT function to shine by showing leadership and fostering innovation. To do that, and to buy ourselves both business credibility and IT bandwidth, we have to aggressively cut costs, but also need to shift IT resources from low to higher value activity. The cost cutting actions are something we’ve wanted to do for some time, but now the economic climate provides the air cover we need. So, our value proposition to the business is double-edged: we are going to agressively retire IT systems and assets that are no longer critical to running or growing the business, and will redirect the resources that are freed up by this rationalization and consolidation of our technology platform and focus them on more innovative and higher value initiatives.
We recognize that some people are going to be inconvenienced by the cost-cutting – they are on the obsolete systems because of a particular report or function they like to use. Unfortunately, we can no longer afford the luxury of keeping old, redundant systems around. While they were written down long ago, they are a drain on resources – keeping them running and the constant need to build and maintain interfaces with other systems.
The other side of this is that our business partners have never needed us to focus on growth and innovation more than they do today. There’s been a literal sea change in available technologies, and we have to find value-producing ways to tap these new technologies. If we can beat our competitors to the punch, we can turn the economic climate to our advantage. And that is our focus.
Economic conditions spell a period of retrenchment for IT. We have to take out costs to help the business weather this downturn. As such, many of the initiatives we have started or were planning are being put on hold. This is hunker down time – we don’t know how long it will last, but we’re betting at least a year. Optics are all important here – I need to show my business partners that I understand the economic climate, and that this is a time for IT to take a low profile, cut back its spending, and do our part to help the company weather the down market.
I find it interesting to think about the drivers of these opposing views. Are some CIO’s inherently more optimistic, and therefore proactive? Or is it the company and its leadership that sets the tone – either empowering the optimists to grow and innovate their way out of a recession, or scaring the pessimists to step into the shadows and idle till the clouds pass by? Like the nature/nurture arguments, there is no simple answer. But I feel the energy and sense a more positive outcome around the proactive innovators compared with the reactive controllers. I know who I’d sooner be around and work with, and, if I were a CEO, who I’d like to have on my team as CIO.