Focus: Federalized Planning
What is it? Modeled after the federal governing system of the United States, where state governments implement federal policies but govern locally, federalized planning is a way to negotiate, set and meld corporate-wide strategies under a common set of policy standards. These may be implemented by local business units in ways they prefer.
Why bother? It cuts costs, and encourages business and technology executives to work more closely together to create and implement strategies aimed at boosting the business bottom line.
Business payoff: J&J has saved some $10 million so far this year and expects to save as much as $50 million per year in North America within two years through volume purchasing, cheaper maintenance costs and eliminating duplicate IT projects. It also hopes to boost profits by speeding new drugs to market.
Challenge for the CIO: The CIO needs to be a leader and facilitator rather than a top-down manager. Without consensus management and facilitated teamwork, cultural frictions could doom change.
Who else is doing it? BP PLC and Siemens AG, among others.