IT on the Agenda
How can CIOs expect to demonstrate their value as board members? Governance experts and recruiters suggest CIOs might want to ask themselves a few questions when they consider pursuing a board seat: How and when do boards handle IT issues? What role do CIO directors play in board discussions? What skills qualify CIOs for board positions? How do CIO directors work with the CIOs in the companies they oversee? And how do CIOs get director jobs, anyway?
One company chairman with a clear vision of how a CIO can add value to a board is Bob Eckert, chairman and CEO of Mattel Inc., the toy company based in El Segundo, Calif. Eckert says his board first reviews three- to five-year plans for business strategy. Then, it looks at separate plans for IT, operations and human resources. As he and other executives execute against those plans, the board signs off on specific IT projects and reviews key milestones. "It's really no different than how the IT group runs project management," he says.
The leading technology voice on Mattel's board is Kathy Brittain White, the recently retired CIO of Cardinal Health Inc. Eckert says White works with Mattel CIO Joe Eckroth and CFO Kevin Farr, who are spearheading a "global transformation" of Mattel's operations. The company is playing catch-up to raise its IT systems to world-class standards: For instance, Eckert complains that Mattel recently ran payroll 50 times a year, even though it issues checks biweekly, because backroom operations at Mattel's Fisher-Price, Pleasant Company and corporate units remain separate.
White, a Mattel director since 2001, advises not only CIO Eckroth but also his staff. Before presenting IT plans to the board, White reviews them with Eckroth. Given her experience integrating the back offices of Cardinal and Allegiance Corp., which merged on her watch, she has had hands-on experience hammering out the global systems, tools and technology that Mattel now desires. CEO Eckert counts on her input toward his "One Mattel" approach to reduce redundancy, underscored by the opening of the company's first shared services center for North America in October 2002.
CIOs who become directors at other firms may work far less intensively with information chiefs. White notes that, in contrast to Mattel, she rarely interacts with the CIO of Certegy, formerly Equifax Payment Services, where she also serves as a director. Avon CIO Edelman says that as a member of the governing board of the Blair Corp., a Warren, Pa.-based direct-mail fashion company, "there have been times I've offered assistance [to the CIO] via a phone call," and on one occasion, she recalls, the CIO of Blair met with her for a couple of hours in New York to discuss strategy.
Edelman said she also facilitated a session of a senior management team and the CIO on aligning IT and business strategy. "They took the concept and ran with it," she says. In addition, Edelman suggested the team use portfolio management for IT, which the team accepted, and she discussed with the team the governance process of project approval.
Each time, though, Edelman says, she took her cues from the president of the business. "I believe I can be an effective second set of eyes, a counselor and collaborate a little," she says. "But at the same time you need to stay in position as a board member, too." (See Viewpoint.)