Beyond Alignment: Organizing and Governing for Performance

It’s extremely rare–unimaginable, even–for a business not viewed as a high-tech enterprise to invest more than $1 billion in technology. But that’s exactly what hotel, restaurant, travel and marketing giant Carlson Companies did.

“When I became CEO, I realized that we were in the technology business as much as we were in the service business,” says Marilyn Carlson Nelson, who spearheaded the growth strategy as CEO and now serves as chairman.

It wasn’t the technology investment itself that drove the results, though. Instead, the way Carlson organizes and governs the company–particularly in viewing technology as a strategic business enabler–made all the difference.

Having started in 1938 as the Gold Bond Stamp Company, Carlson today employs nearly 200,000 people in 150 countries. It owns and manages more than 1,000 hotel properties and more than 1,000 T.G.I. Friday’s and Pick Up Stix restaurants; and it owns the $25-billion Carlson Wagonlit Travel, one of the world’s largest corporate travel management services, and Carlson Marketing Worldwide, a global marketing, events and marketing analytics company. This is an impressive history of performance, and it was built on a framework of expertly managed technology.

In an interview with the BTM Institute, Carlson explained a key component of that technology management philosophy:

“We put together an enterprise-wide Information Technology Council. Each one of our operating groups, such as restaurants, travel, hotels and marketing, had someone who sat on the council. Our objective focused on the bottom of our technology infrastructure. We also created an architecture group, a subgroup of the council, to leverage the infrastructure based on a common technology platform. The Council set some common standards, which we lacked. We negotiated with each other about procurement so that we could do volume buying and licensing across our various industries or our various brands. We decided to do customer-facing software development in the individual groups.”

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