CIO Update: Lionel, you said that managing c-level expectations takes up about half of your time these days. Why is that?
Carrasco: The reality is people spend 80% of their time on operating stuff … just keeping the business up and running just takes 80% of the total effort of the IT organization, while 30% or less is focused supporting the business and supporting the business processes and being able to add value to the organization.
When it comes down to the job of the CIO he has to spend his time on managing technology and managing staff but a lot of time is expended on managing expectations or trying to sell projects or trying to get the executive buy-in into the projects. It’s a lot of justification of the budget and at the same time it’s a lot of change management and issue handling.
While the whole IT organization, 80% of them is just keeping the business up and running, 50% of the time of the CIO is just going change management and politics.
Is this typical set of CIOs you know?
Yes. Five years ago IT in general was part of the infrastructure of the company … and you usually reported to the CFO and somebody in operations. When technology, in the last 10 years I would say, started to change to support business processes … more IT is becoming part of the competitive advantage—or disadvantage—of the company and therefore the CIO now has a much more relevant role in the strategy of companies.
How do you stay current on which new technologies will give this advantage, conferences, talking with your peers and vendors, the media?
All those sources are valid. Typically, a CIO has certain vendors that are very close to the organization because of the core infrastructure technology you own. You tend to have a lot of meetings with them and you open a very wide channel of communication with those vendors.
At the same time you have to keep your eyes open. You have participate in conferences and talking to analysts and, mostly, watch your competitors and be aware of what is going on in the other industries, similar industries or your own industry to identify the trends in technology that will make you different so you can have a valuable position for your own CEO.
Because, to tell you the truth, coming from the vendor perspective most of the time is like a ‘me too’ thing: kind of late to innovate or to do something new.
If you want to be aware of (new technology) you need to be able to visualize them in the early stage. Otherwise, by the time your vendor will come and make your presentation, it’s because everybody in the industry already has something like that.”
How is IT viewed by your bosses?
At Neoris, IT is often viewed as a necessary evil, but at the same time is acknowledged as being essential to the company’s future, growth, advancement and ability to stay ahead of our competition.
Over the years there’s been an increasing need to involve c-level executives in our conversations about technology and infrastructure investments and implementations.
The key today is to focus on the ROI benefits derived from a pending technology investment or implementation, providing a realistic timeline as to when ROI will be reached. C-level buy-in from the beginning of the process really helps to move IT initiatives forward.
Is ROI all that matters today?
It does a lot. I think there is many ways to justify a project … all of those reasons, at the end, the financial way to justify those benefits is by defining ROI.
So a lot of this depends on the way your CFO and CEO is thinking. But I have seen all of my peers; we all have to become very proficient in the way to present business cases. You need to build a business case because your IT project will compete with other infrastructure projects for the same amount of dollars available in the budget.
It is not anymore the days where you have separated budgets available to you; you have to compete for budget. And I think this is very healthy. At least, with my CEO the discussion is always based on what is the business case, what is for the company there.
In 2000, especially with the Y2K effect and later with some of the waves of the internet and (new) technology, people usually didn’t talk much and why somebody was charging $3 million or $30 million for a project.
While, today, the exec’s are much more educated. They are aware of the issues other competitors have faced and failures and so people are not making crazy investments anymore. They are very conscious. They treat IT projects in much more careful way.
The ROI and benefits will only happen if people use it. You can have the best portal the best Internet system and, if people are not using it, it will not work.
Define the word “agile” in terms of IT and where this fits in terms of today’s more rational thinking regarding IT spend.
Things happen faster and faster within companies. Processes and services and product lifecycles are happing faster and faster due to the Internet. What’s not happening faster is ability of the organization to change their processes.
IT is not agile enough (to keep up with the pace of change). Why is not agile? Because (company’s) legacy systems were designed for stable processes and never-changing processes and, today, processes are as dynamic as the market.
So, today, you have a distribution system (for example) that are based on your proprietary fleet; tomorrow you have to outsource that and you have to have a combination of both and your IT systems need to move at the pace of the business.
So agility, it means the ability to react fast to business needs. In order to be agile in your IT and the way you provide IT services. It will require architecture changes. I’m talking about SOA and Web services, for instance, that will allow you to act fast in response to the demands by the business processes. Agility in some instances has become more important than ROI.
Where are you finding your biggest cost-savings these days?
We are seeing some great cost-savings by implementing technologies that allow our staff to travel less. We’re using voice over IP, Webex and virtual office commuting. An added benefit here is that employees spend less time away from home and more time with their families, but can still be highly productive contributors to our bottom line.
Lionel Carrasco is CTO Neoris, a global IT consultancy, systems integrator, custom application developer and leader in emergent technologies. Carrasco has more than 20 years experience in IT consulting in the banking, insurance, transportation, retail, manufacturing and oil industries.