Thursday, October 12, 2006

How CIO's Address Biggest IT Complaints

Complaint 1: IT costs too much – Strong Project Driver Needed.
Playing the role of a Project Driver, a CIO could neutralize this complaint primarily by changing the way his superiors perceive IT. He should be able to convince and educate them that IT is not merely a cost, it is an investment. This is easier said than done. The best way to convince and educate top management on the value of IT is through significant and measurable results that make business sense. This lessens the fear and perceived risks in IT investments. Also, convincing should come before educating. It is very challenging to educate a person who is not yet convinced. You could teach him all the technical mumbo-jumbo and he could come-up with the same conclusion he had before you started. To better illustrate the role of Project Driver in addressing the perceived high cost of IT, we frame it in the context of government institutions:

Social Security System:
One big challenge in implementing reforms and policy enhancements in terms of Information Technology in the SSS is for the CIO to justify effectively and communicate very clearly to the higher-ups, the essential role the proposed IT projects will play. The CIO must be able to face the reality that the top management tends to be cynical most often, because when you are in the public sector, public accountability is a very high price to pay, so to speak. The CIO must recognize the fact that IT projects must work very well within the allotted budget and that it is imperative to deliver a clear message in terms of the benefits in store as well as the cost implications for the said projects.

Thus, the CIO must be a very strong project driver to do this. In the public sector especially, continuity is also a steep challenge to overcome. Agency heads and administrators come and go, depending on the appointment and tenure of a newly installed head of the government administration. Sad as it may be, some good and promising IT projects end up different hands, but don’t get implemented because of policy, priority, as well as cost constraints. Hence, someone who really has the political will and really is a project driver is needed to overcome this challenge.

Office of the President:
Given the numerous allotments of the Office of the President (OP) for its so-called “Social Services” and provided that our poverty-stricken country needs basic human needs of food, clothing, and shelter, among others, it is very difficult to squeeze an IT budget or more so allocate a significant amount for it. They cannot conceptualize how a bunch of computers can help alleviate poverty or help address the needs of the populace. Thus, OP officials resort to traditional yet tested ways of addressing various situations. As a result, processes in OP are mostly inefficient and employee tasks are often replicated. The same traditional processes are the very source of corruption in OP with familiarity and flawed systems being at the heart of it.

The excuse “It Costs Too Much” has also been used by officials to mask their illiteracy in the field of IT. They easily jump into the conclusion that having a competitive IT infrastructure is very expensive and that the office cannot afford such just so they can protect their respective seats of authority. Most officials seem uneasy with the thought of IT since majority of them are “senior citizens” who have become very accustomed to the old system and totally unfamiliar to the whole new world of information technology. They fear that they may be displaced by an IT savvy employee with the advent of such technology.

Conclusion
There are two potent ways to disillusion top management from IT investments. The first is to accrue several uncompleted or underperforming IT projects. The second is to pursue non-critical projects just to discover later that they have run out of funds for the critical ones. Since the Project Driver provides discipline and prioritization in projects, he should be able to avoid the above mentioned predicaments as well as change the perception of his superiors (as well as the rest of the company) that IT is not merely a cost, it is an investment.

Complaint 2: IT is a commodity that fails to deliver differentiation – Savvy Business Strategist Required.
As a Savvy Business Strategist, a CIO should be able to explain and justify the role IT plays in giving the company differentiation or competitive advantage. Most importantly, he should be able to align and seamlessly integrate IT strategy with the over-all corporate strategy. This is done by being able to tailor-fit IT infrastructures to the company’s needs. We must remember that IT that should adapt to the business and not the other way around. Perhaps one reason why some people perceive IT as merely a commodity is because they have been too exposed to narrow-minded IT people who want to force their rigid technologies into the company. We expound on this role in the context of two seemingly non-IT dependent industries: agricultural and healthcare products:

Berris Agricultural Co., Inc.:
Given that our main customers, farmers, are not IT inclined, it would be difficult for our company to justify an investment in information technology. Why invest if your customers are not adept to the advances of technology? Whom are we trying to impress? However, we had realized the importance of quick correspondence with our suppliers abroad. We invested in the latest internet technology like the broadband internet and WIFI service. Investment is really big at the start but the benefit of developing business fast cannot be quantified. It would put you ahead of competition. Although farmers cannot distinguish on what IT technologies we use, they could surely distinguish our response time.

Johnson & Johnson (Philippines)
When it comes to IT, we at Johnson & Johnson don’t have much issues and misconceptions towards IT. I would say that Johnson & Johnson business operations are 99% dependent on IT.
Currently, Johnson & Johnson group of companies globally is intensively using the information Technology infrastructure for the advancement and growth of the company. As a matter of fact Johnson & Johnson formulates a team called “Process Excellence” to monitor, evaluate and identify the need of the company when it comes to business and operation processes capitalizing Information Technology.

Conclusion
In the above examples, we could see the differences in perception with regard to IT. In a local agricultural firm, investments in IT can hardly be justified. Compare this with a multinational firm. We could see that their IT initiatives are in full-swing. In every industry, there is a level of IT investment that merely keeps companies afloat. Go beyond this in the proper direction and you create a competitive advantage. The important thing is that the CIO playing the role of a business strategist should be able to customize IT to serve the needs of the business and its customers. This requires a deep understanding of the business and its underlying processes which can only be acquired if the CIO has enough humility to ask, “What are the business issues and what do we need to do?”

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