Getting the Message
How many times have you read articles in which business managers are quoted as saying that technology managers just don’t understand the business? That may have been true in the past, but it’s certainly not true anymore.
In fact, Baseline and sister pub CIO Insight have published hundreds of stories about IT managers and executives who are in sync with their business counterparts. These technology leaders “get it.” They know that technology’s raison d’être is to support business objectives, enhance customer satisfaction and retention, increase employee productivity, enable new products and services, and help improve the bottom line. Technology is all about providing business value, and IT executives are strong advocates of that.
Today, technology and business are so closely intertwined that a strong partnership between IT and corporate leaders is essential to success. This relationship is especially critical in the current economic environment, in which demands for IT services keep growing while technology budgets keep shrinking.
A recent study by The Hackett Group projects a growth rate of 8.6 percent in IT demand between now and 2011, with only a 1.3 percent increase in the IT budget’s growth rate. There is “more pressure than ever before on IT organizations to do more with less,” said David Ackerman, Hackett’s IT advisory practice leader, in the release accompanying the report.
IT leaders are rising to the challenge. Consider Dominic Nessi, who graces our cover. As the executive director and CIO of Los Angeles World Airports, he understands the importance of business-IT integration. “We have to connect all IT investments to the business operation of the airport,” he states.
To accomplish that, Nessi works closely with CEO Gina Marie Lindsey and COO Steve Martin, who, he says, “both ensure that our technology investments are well-thought-out and meet the future needs of our business.” He adds, “My success as a CIO is completely dependent on my peers in the non-IT areas of the airport.”
And Nessi is not alone in his belief in the importance of a business-IT partnership. Steve Bozzo, the CIO of
1-800-Flowers.com, and Craig Tenenbaum, the company’s director of IT financial planning and control, implemented a chargeback system for the various brands so the business groups can see how they’re using technology resources. “Now they can keep tight reins on their IT spending,” Tenenbaum points out.
In addition, the company’s IT organization has monthly business relationship management meetings with the brand presidents. “What we’ve done is take all the tech stuff and translate it into business language so that it’s meaningful to our brands and business units,” Bozzo explains. “Now they can make decisions in a way they never could before.”
In other enterprises, technology is the key to a different relationship—with business partners. Take Wells Fargo, which implemented server virtualization to provide its partners with “greater flexibility, reduced costs and an accelerated time to market,” according to Scott Dillon, head of technology infrastructure services. He adds that the company is focusing on green IT “when it benefits our customers, makes good business sense and delivers real ROI.”
The same article features MasterCard, which launched a service-oriented architecture initiative to assist the business. “SOA enhances our competitiveness by enabling us to bring products to market more quickly and with fewer resources through shared business services that we repeatedly leverage across product lines,” says group executive Joan Kelly.
“In addition, SOA provides global operational efficiencies.”
These examples highlight a small sample of all the technology leaders out there who add value to the business. Our 2009 Baseline/BTM 500 report, which will be published in our October issue, will include hundreds of companies that have IT leaders who understand the importance of business-technology convergence.
Our survey closes on June 15, so if you work for a public company with $500 million or more in annual revenue, please consider participating. Just go to baselinebtm500.com to register.
It’s time to make it clear that technology leaders understand the business and the need to partner with their colleagues in other areas of the company. They definitely “get it.”