Can a CIO Become Too Strategic? - ' Page 3'

Finding a Balance

It doesn't take a rocket scientist to know that commun-ication is key to ensuring the proper execution of strategy.

But closing the gap between CIOs and their lieutenants requires more than periodic chats around the water cooler, says Doreen Wright, senior vice president and CIO of Campbell Soup Co., whose lieutenants also report to a business or regional president.

"What you're dealing with is an organizational structure issue," she says. Overwhelmingly, lieutenants want managers to include them in strategic planning discussions. That requires organizational change. (See "Campbell's Condensed," page 36.)

Lockheed's Remy says his department definitely felt the tension between the CIO and his lieutenants before they hired Gartner to help them through a business transformation that gives direct reports a much greater role in setting strategy. Now, the IT shop meets with the business unit each year to hammer out a strategic plan.

"Key business members are interviewed, and then we sit down and decide where we will make our investments," he says. "The plan we develop becomes part of the overall corporate plan. We then design the business goals, and measure performance every month."

His company kicks off each new year with a companywide gathering of IT staffers to share information about projects and strategy. "That way we can reduce the amount of reinventing the wheel," he explains.

At United Parcel Service Inc., strategic initiatives come from the bottom up, not the top down. IT portfolio managers are coupled with a business manager in each strategy group, such as CRM or ERP. Working side-by-side, the teams propose projects to a corporate oversight committee, which is chaired by the CIO.

The CIO and other business executives ultimately set the strategy, but since the lieutenants are the ones presenting their ideas, "they champion the project and ensure the vision is disseminated through the company," says David Barnes, UPS's newly appointed CIO. This process, he says, ensures that everyone in IT is on the same page.

But a near 50/50 split doesn't mean that the business message, or the leadership, is filtering down. Nearly a third of the IT lieutenants responding to our 2004 alignment survey report that business strategies are unclear to them.

"Alignment doesn't just happen at the top, it has to happen all the way through," says Kitzis. "The top may agree with what's going on, but when you go down, you get different messages, or there isn't a sufficiently formal structure below the CIO to actually engage in the right way."

Even when lieutenants are involved in strategy, CIOs need constant feedback from them to make sure their direct reports are given the necessary support to execute, says Gartner's Kitzis.

That's why many companies have created an Office of the CIO to focus on communication, strategy and results. "The CIO can only be so many things," Kitzis says. "They need an extension to ensure that knowledge-sharing occurs."

Furthermore, for IT staffers to be able to truly support the CIO's strategic vision, they need a better understanding of how IT projects bring value to the business—and that's still not happening at most companies, says Jerry Luftman, a professor at Stevens Institute of Technology in Hoboken, N. J. "IT people largely do not have the industry knowledge even if they have been in the company for 20 years," he says.

Kotter agrees. While CIOs need to prove the business value of IT to the executive team, they must also remember to teach the value of business to IT workers.

"It's a challenge with all technical or specialty groups—law, finance and certainly IT," he says. "They become a thing unto themselves. In great companies, that doesn't happen." Kotter points to Wal-Mart Stores Inc. as a company that makes sure that both its business and technology strategies are clearly understood throughout the company.

Ultimately, the key is leadership, and CIOs need to step up. "CIOs have a choice," says Kotter. "They can say: 'I want to do a great job, so I will find some great leaders and watch them like a hawk, and ask them for some mentoring.'

"If the CEO is a great boss, for example, go right to him and ask him for help. Read some books. Otherwise, you can decide not to provide that leadership and risk being fired, or say this position isn't for you and go back to a role that draws on what you're good at. But you must choose."

Leading a company through change—whether it's technological or organizational—is never easy, says Remy.

"I was involved in bringing the first microcomputers into this company—replacing drafting boards, replacing mainframes—and the vast majority of the people thought I was crazy," he says. "They said, 'Why are you taking my drafting table away from me?' People will not always share your vision; they don't always like to learn new things. So when you choose a CIO, you have to choose a leader."

And the basics that make leadership work are no different for a CMO or a CEO than for a CIO, says Kotter.

"A leader has to be able to work with others to put together some clarity of direction for information technology in the business. They have to be great at being able to get both management as well as his or her subordinates to understand and to buy into that strategy."

It's that kind of leadership too many IT lieutenants are still looking for. "When I took this job, I thought it was so cool that I wasn't doing something meaningless," says John, the pharmaceutical executive. "You could see tangible results when a new drug came out, you knew that drug was keeping thousands of people alive. But now, there is no hope of accomplishing a good job. People are just throwing up their arms. It's complete helplessness, and it really hurts."

We invite you to contact the writer at Debra_DAgostino@ziffdavis.com if you have your own story to tell—in the strictest confidence.