CIOs need to be open and honest about IT projects. Otherwise, their customers will not be able to make informed decisions and eventually won't trust the IT organization.
By Charles Araujo
It had been one of the most frustrating weeks of my life.
We had been working with a very large manufacturing firm for quite some time. We had become their "trusted advisors." Or so we thought.
Then we learned the CIO was bringing in a big management consulting firm to present a business case to his board. At the end of the week, we were having dinner with the CIO and members of his senior leadership team, so I figured I'd have my chance to get to the bottom of this decision.
"Sam, why are you bringing in this big consulting firm to prepare the business case for your board?" I said, half asking and half complaining. "You know that we’ve been doing this work and that we’ll be the ones left to do the work after they’ve come and gone."
"Charlie, I know that. But you guys are way too small. I can't put you in front of my board. I need this consulting firm to help me sell the board on what must be done."
And with that, our conversation was over. I understood Sam's reasoning. It would take me years, however, to figure out that his reasoning was completely wrong.
The Problem With Pitches
In truth, I probably can't blame Sam. (His real name, like other details in this article, has been changed to protect the privacy of those involved.) This is the way the game has been played from the very beginning of the IT function. I discovered this unfortunate truth when I conducted research for my book, The Quantum Age of IT: Why Everything You Know About IT is About to Change. IT has always believed that "the business" is not capable of understanding technical challenges and trade-offs, so we have decided what was best and proceeded to "sell" the organization on the right course of action.
The problem is that this process of pitching a project has created a dysfunctional relationship in which IT's customers no longer believe that they can trust us—and for good reason.
I remember working with Sam several months later. He asked us to review the business case that had been prepared by the management consulting firm. It called for a $50 million investment over the next two years. We looked at the business case and told him it was crazy. (Okay, we were a bit more tactful than that, but you get the message.) By our estimate, it was a $150 million project that would take at least four years to complete—and probably closer to five. "I'll never be able to sell that to the board," Sam told us. "This business case is what they'll buy."
So, Sam pitched the business case. And the board bought it. The project was funded and got underway. Two years later, Sam was back in front of the board. The $50 million had been spent. And he was asking for a three-year extension and another $100 million. Of course, at this point, the board felt that they had no choice, so they funded the deal. But the trust between Sam and the board had been eroded. And before that three-year extension transpired, Sam was looking a new job.
Sadly, it's a common tale in IT. You probably have your own version of the story in your own company's history. It is also illustrative of why the third organizational trait in The Quantum Age of IT—the need to become a transparent organization—is perhaps the most important. And why you must have the courage to be a transparent leader.
The Courage of Transparency
The problem with being transparent is that it is not the path that leads you to getting what you want or even what you know is best for the organization. Being truly transparent requires a degree of trust and vulnerability. You must possess enough confidence in what you're presenting and in your organization's ability to recognize the right course of action. Most important, when the organization doesn't choose what you think is the best option, you must have the courage to accept that decision.