An Active Role
One consequence of the shift from a focus on IT costs to its impact on overall business strategy is that the role of the CIO is evolving to include some responsibility for companywide metrics and performance. At the end of the day, the job of the CIO, like every other senior manager, is to increase revenues, decrease costs and maximize the market value of the company. So CIOs must assume a more active role in measuring value companywide in order to successfully show return on investment from their e-business systems.
Before buying a new e-business system, the most important jobs of the CIO is to bring financial discipline and accountability to the decision process and to tie the business goals, functional requirements and vendor options together. Even when a project is "owned" by a business line or managed by cross-functional teams in which IT is a participant but not a driving force, the CIO's role is critical.
After the purchase, the CIO and the IT staff must communicate the near-term strategic targets and metrics to be used to measure the project's payoffs. Rather than create new metrics based solely on IT-focused costs and IT-centric benefits, CIOs need to size up the goals of the company and evaluate its business performance.
Understanding the corporate politics of such a shift is important. In many companies, customer-facing e-business applications are heavily influenced, if not owned outright, by sales, marketing or customer support specialists.
"The IT group may be the catalyst, the driver or the enabler of e-business, but we don't do it in a vacuum," says Vallorosi. "Good coordination and cooperation with the business units is important." In some cases, he says, the CIO and the IT team can even become a part of the sales process. "Never before was an internal IT person a part of the customer bid process, but now we are actually participating in presentations to explain our e-business capabilities to prospective customers," says Vallorosi.
Perhaps the most critical responsibility of the CIO is to create an atmosphere that will lead to the creation of new metrics, and ultimately to the success of the e-business system. That's what takes ROI valuations from mere projections to reality. The e-business investment must change behavior in sales, marketing and customer support. In partnership with the rest of senior management, the CIO needs to help educate and motivate employees to make sure the change succeeds. In other words, CIOs play a critical role in making e-business pay off.
Peggy Sue Heath, a vice president of Ziff Davis Market Experts, analyzes emerging technology markets. Comments on this story can be sent to firstname.lastname@example.org.
This article was originally published on 05-01-2001