As we went about doing research for this book, one theme constantly reoccurred: high-performing CIOs repeatedly told us you can’t tolerate excuses for failing to deliver on expectations and delivering value. You can’t complain about the pressures you are under or how your business partners do not understand IT or have a different view of the priorities. The best CIOs said that if you want to earn the same level of respect accorded other parts of the organization, you need to make sure you hold yourself, and your department, to the same standards that they are judged against.
Too often we have not done that, and as a result, the way IT is viewed has suffered, a point that Barbra Cooper, group vice president and CIO for Toyota Motor Sales U.S.A., hammered home for us. “You know why the perception of IT has suffered for thirty years?” she asks rhetorically. “It’s almost as if we’ve swallowed a victim-mentality pill. You know, ‘Poor me. People don’t understand how hard my job is.’ That kind of thinking is simply not acceptable if you want to be taken seriously by the organization.”
Proctor + Gamble’s CIO Filippo Passerini is equally blunt:
One thing that must be forbidden in our world is self commiseration, the idea that people don’t understand how good a job we are doing, or that they don’t appreciate us. That is absolutely nonsense. It would be as if P&G said the reason our sales are off is because customers don’t understand how much care we put into them. That wouldn’t be our customers’ fault. It would be ours, because in the end, it doesn’t matter how hard we try. It is how much we sell. In IT, the mind-set has got to be the same. It is up to us to shape our destiny; it is completely up to us.
Passerini, who was trained as an engineer, is arguing that CIOs must think like a business leader and not just a technologist, and he concedes that is not necessarily easy for someone who has come up through the IT ranks:
People with a technical background, like myself, tend to think in binary terms. Either-or. You can either have lower cost or better quality; speed or power. But if you are running a business unit, as I did, you are expected every year to deliver bigger sales volumes, increase your market share, and increase your profit. If you think about it, those three—profit, volume, and share—are in conflict. Because if you want to increase profit, you will increase price—but if you increase price, chances are, volume will drop. So in business, it is not either-or. It is “and, and, and.”
We need to shift the thinking in IT. We have to stop saying we can reduce cost or increase speed. We need to stop telling our colleagues that if we increase speed, the quality will be affected. We need to make our thinking “and, and, and”—that we can reduce cost, increase speed, and improve quality. At P&G, we have been doing this. We have been training IT people to have this business mind-set. We have managers who act pretty much like a brand manager with the rest of the company. They are responsible for the creation of the service, running the service, innovating the service, providing the service, commercializing the service. So the skills that are required are the ones of businesspeople.
Sony’s CIO Shinji Hasejima sums up the no-excuses argument beautifully: “Instead of being reactive, CIOs must be proactive. In the past, when IT was given too many tasks, it took the easy way out by prioritizing. We on the IT side need to struggle more just like our business partners within the company— doing much more with much less—or we cannot be true partners in the business.”5
Up until now, we have focused on the internal factors that are demanding that you become a leader first. But there are also external factors that amplify this need.
WHY THE DEMAND FOR ADVANCED LEADERSHIP WILL EXPLODE
If you are feeling that the pace of change is relentless, and you are a person at the epicenter of making sure that your organization not only keeps up with it but also responds effectively:
1. You are right.
2. You are not alone
For whether we view change through a social or business lens, the underlying enabler, without doubt, has technology at its core. Indeed, the speed with which information technology is reshaping the global economy and creating new forms of competition is staggering. It is not only enabling new business models but also challenging traditional management assumptions. And we are only just beginning.
By the nature of the CIO role, you sit, whether you like it or not, at the very eye of this storm, at the nexus of decisions and leadership actions. These decisions span an immense spectrum, from what personal productivity devices your organization will use, to what systems and people to deploy to ensure your organization can do business effectively around the world.
The complexity of these trends is increasing—in some cases exponentially—and we have a shortage of qualified business technology leaders to deal with them. As a result, the demand for advanced leadership will explode. A look at just a couple key factors you will have to face in the years ahead will explain why.
The Hyper-connected Enterprise
As the information economy takes permanent hold, the twenty-first-century organization is emerging, one that exists within a complex ecosystem filled with numerous intersections and interdependencies across suppliers, buyers, and customers worldwide. Gartner analyst Diane Morello calls it the hyperconnected enterprise, and it is easy to see why.
Let’s start with the obvious. There are more outsourcing relationships, partnerships, and joint ventures than ever before. Whether focused on stimulating demand or providing increased channels to market your company’s products, the increased connectivity and interdependence is rampant. And all this does not even take into account the growing influence of consumer and advocacy groups and the rise of social networking. When you add all this up, it is not hyperbole to say we have never before seen the likes of this kind of interconnectivity among stakeholders.
As this trend rolls across enterprises of all types, your job, will increasingly be part of an ecosystem that is beyond your direct control.
How do you function in this new environment? You start, as Kimberly-Clark’s CIO Ramón Baez makes clear, by forging closer relationships with key partners both inside and outside your organization:
Since we outsource and deal with multiple stakeholders, it is important that I get our partners just as excited about Kimberly-Clark as I do the people within our company. And I need to be just as collaborative with them. If I am not, it’s going be very hard to influence some of the direction that we need to go.
Dealing with people outside the corporation is going to become even more important in coming years. So what I am now dealing with—and expect to be dealing with to an even greater degree going forward—is managing diverse relationships both inside and outside our company. That’s a huge challenge for a lot of people. So what I’m trying to demonstrate to my IT folks is that, while it is true that they need to have technology experience, they really need to master that skill of managing diverse relationships.
That is a huge point. While you have always had to get work done via others, the “others” have expanded radically and are increasingly independent and outside your direct control. Given the increasing complexity of how business will get done in the future, traditional command and control will be dead. You will have to achieve results through your ability to influence people.
One more point before we move on. It’s important that we don’t make the mistake of thinking that this highly complex, hyperconnected enterprise exists only for the Fortune 100 global companies. It’s a trend we’ve seen across just about every enterprise and business. Take the example of health-care CIO Dean Harrison. You wouldn’t think that a hospital system geographically bounded by Chicago would be all that complex. But the reality is that his company is reflective of most, regardless of size. Harrison describes the web of business relationships at Northwestern Memorial:
We’ve got sixteen hundred faculty members, seven hundred and fifty medical residents, and approximately seven thousand employees. Children’s Memorial Hospital and the Rehabilitation Institute of Chicago are part of our medical center, as we all share a clinical affiliation with Northwestern University Feinberg School of Medicine. In addition, other critical relationships extend beyond our campus partners to include numerous vendors and suppliers that help us provide the safest care to our patients and recruit and retain a workforce of talented and committed people who share our values and that help us achieve our vision. The management and delivery of health care is a complex environment and benefits from strong relationships.
The more complex environment will expose leadership shortfalls like never before. Organizations will be looking not only for people comfortable with the increased complexity that they will face, but also for those who can actually thrive in this kind of environment. They need executives who can set direction, rather than those who direct. Who can inspire and motivate a diverse team beyond their immediate control. Who can lead in a participative way that fosters true buy-in and loyalty to common goals. Who can establish a shared vision and then execute across boundaries.
As Toyota’s Cooper explains, “we are entering a future of very fast-paced global change. In the past, IT was a service provider and judged by how well it could come up with a solution that provided what the business wanted at a reasonable price. But, as the line between business and IT begins to blur, the question will be how well can IT represent the enterprise across the entire supply chain, to use just one example, not just how well it performs in its individual silo.”
Reprinted by permission of Harvard Business Review Press. Excerpt from THE CIO EDGE: 7 Leadership Skills You Need to Drive Results. Copyright 2010 Gartner, Inc., and Korn/Ferry International.