Beruflich Dokumente
Kultur Dokumente
ARE YOU A
REINCARNATE CIO?
If not, how do you achieve this
enlightened state?
PAGE 9
DISPATCHES FROM
THE FRONT LINES
Experience-based insights about
current CIO challenges.
PAGE 23
HCL Technologies and Unstructure launch Straight Talk, a platform for peer-to-peer
exchange of practical ideas on a variety of topics and for a variety of audiences
including CIOs. If youd like to share your thoughts, there are three ways to join the
conversation: subsequent issues of Straight Talk publications; a Straight Talk Web site
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Issue Number 1
CIO
an
publication
Contents
6 From the CEO's Desk: Leading Across Boundries
Vineet Nayar
52
54
58
61
65 Solution Spotlight
27
29
33
38
Leading by Example
David Evans, VP, Information Technology, Quest Diagnostics Inc.
44
A sales order tracking tool currently being built on the iPad platform
67
37
Maryfran Johnson (CIO Magazine), Jeanne W. Ross (MIT Center for Information Systems Research),
66
76 Appendix: 15 Questions
A Checklist of Things to Consider as You Begin Your Annual IT Planning
CIO
Chris Barendregt
CIO
Greg Black
Former CIO
Ronald Blahnik
VP/IT Engineering
Lowe's Co.
Scott Bonneau
VP/IT, Service
Management
Jeff Carlson
CIO
Bruce Carver
CIO
Cummins Inc.
Chuck Ciali
CIO
Teradyne Inc.
CIO, CAO
David Evans
VP/IT
Glyn Evans
Corp. Director,
Business Change
Patrick Geenty
Assistant Chief
Constable
Tim Graumann
Phil Gray
CIO/Australia
Acknowledgments
Mike Green
Operations Manager
3M Company
Virginia Guthrie
CIO
While it isnt possible to name everyone who has contributed to CIO Straight Talk,
the following are particularly worth mention:
Rob Harris
SVP/IS
U.S. Foodservice
Kris Hillstrand
Former CIO
Rob Hornby
CIO
Maryfran Johnson
Editor in Chief
CIO Magazine
Paul Johnson
EVP, CIO
BB&T
Ellen Kitzis
Former Group VP
Dan Lambert
VP/Service Integration
VP/IT Enterprise
McDonald's Corp.
Tim Marks
3M Company
Albert Perruzza
Martin Racioppi
Pearson P.L.C.
Jeanne W. Ross
Director
Kees Smaling
CIO
AEGON N.V.
Raymond Siebert
William T. VanCuren
CIO
NCR Corp.
Walter White
CAO
Design Team
Mukund Arora, Amy Detrick (KG)
Editorial Advisory Board
Shami Khorana, Krishnan Chatterjee, Dharmender Kapoor,
Rupak Rathore
Circulation/Distribution
Laurance Allen
All HCL senior sales leaders; the entire Cost-Out Idea Owners team; Abhay
Chaturvedi, Amitabh Dasgupta, Ajay Nair, Anand Narayanaswamy, Ankit Kumar
Duggal, Aravind Venkataramanaiah, Chandraraj Ramachandran, Franck Henri
Jean Ridon, Gaurav Sharma, Gowri V Shankar, Harsha Rao, Kunal Purohit, Neha
Chopra, Ninad Kamlesh Parikh, Raj Singh, Rakesh Raman, Robert DeSouza, Robert
MacDougall, Sandeep Malik, Srivathsan Sridharan, Sudhanshu Gupta, Sudip Lahiri, P
Sunilkumar, Vijayakumar, Vinod Sathrukhnan.
For information on reprinting articles and all other correspondence,
please e-mail straight.talk@hcl.com or contact the editorial team at:
Paul Hemp
HCL America, Inc.
400 Crown Colony Dr.
2nd Floor, Suite 203
Quincy, Mass. 02169
United States
Tel: +1-408-328-7501
Anirban Sanyal
HCL Technologies
2nd floor, A-9, Sector - 3
Noida - 201 301, Uttar Pradesh
India
Tel:+91-120-4069000
CIO Straight Talk is a periodical published by HCL Technologies for its clients and
friends. The contents are copyright 2010 by HCL Technologies Ltd. All rights
reserved. Excerpts may be reprinted with attribution to HCL Technologies.
Articles can be found at our soon-to-be-revamped website:
www.unstructure.org/straighttalk.
with orat
Leading Across
Boundaries
Vineet Nayar
Stop for a moment and look 10 years into the future. What do you see?
Over the next decade, business will face daunting challenges:
Emerging markets characterized by rapid growth but products selling
at a fraction of their developed-economy prices. Countries with aging
workforces trying to leverage the entrepreneurial energy of younger labor
pools in places like China and India. Sustainability issues that bedevil
not just business but all of society. These will be overtaken by new issues,
just as were learning to deal with the old ones.
What will spark the innovation needed to address these cascading
challenges? The promise of great personal wealth from a successful
startup? Increased government funding of R&D? I believe the answer lies
in a new kind of organization.
Vineet Nayar
CEO, HCL Technologies
// 7
Are You a
Reincarnate
CIO?
As the IT landscape becomes transformed almost
beyond recognition and as CIOs are called upon
to transform their companies, they may find that
they also need to transform themselves be born
again, reincarnated in a new form with a new role
and a new way of thinking. A number of CIOs offer
their thoughts on what a Reincarnate CIO looks like
and how the change takes place.
The Various
Incarnations
of the CIO
The Environment
The CIO
Applications Portfolio
Transaction processing from order
through delivery
Role
Operational manager of
specialist function
Executive Attitudes
IT for cost displacement and
automation; from enthusiasm to
cost consciouness
Tasks
On-time delivery; reliable operations
Are You a
Reincarnate
CIO?
A new set of skills and mindset may be needed to
succeed in the evolving CIO role.
CIOs are being asked by their CEOs to help develop new offerings
for customers. That means the I in CIO now stands for innovation,
not information.
Ronald Blahnik, VP/IT Engineering, Lowes Co.
The CIO must be viewed throughout the organization as a trusted
business partner and leader.
Dean Del Vecchio, CIO and CAO/Corporate, Dow Jones & Co.
For IT to drive business transformation, an IT leader must couple a CEOlike grasp of emerging business strategies within his or her industry with
CTO-like understanding of emerging technologies outside of that industry.
Walter White, CAO, Allianz Life Insurance Co.
These are the kind of candid comments we hear as we talk to
CIOs and other IT executives about the challenges they face these
days. You yourself may have voiced similar thoughts to a colleague or
business partner.
11
***
The idea of expanded CIO responsibilities isnt
new, of course. That the IT leader is well-positioned
to help define and develop business strategy, rather
than simply enable it, has been discussed for a decade
or more.
'80s
Distributed Era
The Environment
The CIO
Applications Portfolio
Knowledge worker support;
interorganizational systems;
process reengineering; ERP
systems
Role
Executive team member;
organizational designer; strategic
partner; technology architect;
informed buyer
Executive Attitudes
Increased involvement in IT issues
and governance; polarization of
attitudes: IT as strategic asset or
cost to be minimized
Tasks
Manage "federal" IT organization;
recruit and develop staff; educate
line management; align IT with
business; design corporate
architecture; scan technologies;
stabilize and standardize
infrastucture; scan services market;
develop alliances with key vendors
Snapshot of a
Reincarnate CIO
In the leap from CIO to CEO of Progressive Corporation, Glenn M. Renwick has overseen impressive growth since taking over
the top spot at the highly rated automotive insurance provider in 2001. Under Renwick, Progressive has increased revenues from
$6 billion to $15 billion. But more important, Progressive has maintained its reputation as one of the top auto insurers in the
nation and a dominant Internet player in the auto insurance marketplace. As CIO from 1998 to 2000, the native New Zealander
drove Progressive online well before other insurance providers understood the power of the medium. Progressive.com was the first
to offer comparison insurance quotes online, and today it continues to find innovative ways to lure customers to its website with
such options as Name Your Price, an opportunity to build an insurance plan around a price the consumer suggests. In addition,
customers can file claims online and follow their claims with online claims reporting and tracking. Progressive.com has been rated
the best website for buying and owning car insurance by Keynote Systems, Inc. every year but one since 2000. With his CIO
background, Renwick was able to envision the competitive advantage that technology offered early on, and under his leadership,
Progressive has woven technology into the fabric of the corporation. //
Are You a "Reincarnate CIO"? //
13
Snapshot of a
Reincarnate CIO
Dawn Lepore, CEO, Drugstore.com
When Dawn Lepore became CIO at Charles Schwab
& Co. in 1993 at age 39, she was the rare woman
technology leader. In fact, she may well have been the
only woman CIO at a major company at the time, and
she knew she would be challenged. To make things
more difficult, she did not have a computer science
degree or an MBA. She was, in fact, a music major,
which made her a target for naysayers who didnt
believe she was qualified for such a technology-centric
position. But she had some traits that served her well
as CIO and eventually helped elevate her to a CEOs
position. She told The New York Times, The reason
I got (the CIO) job was that I took on really tough
assignments, things nobody wanted, things that people
thought were kind of impossible or thankless tasks.
So I proved that I could take on things I didnt know,
and learn ... And I was good at building relationships
across the company. Under Lepore, Charles Schwab
began online stock trading in 1996, a pioneering move
that changed the industry. Lepore served as Schwabs
vice chairman and CIO for 11 years before joining
Drugstore.com as CEO in 2004. Ironically, Lepore
isnt the first former CIO to lead Drugstore.com. Her
predecessor, Kal Raman, was the companys CIO and
COO before taking over the top spot. //
15
There's an
interesting litmus
test of a CIO's
business orientation:
Ask him who his
customers are.
Ask yourself.
To focus and enable transformational-type
change requires a deep understanding of business
opportunities, as well as excellent execution abilities,
says Paul Johnson, EVP and CIO of BB&T, a
regional U.S. bank.
Some CIOs point out that a typical IT mindset
can trap IT executives in techno-centric thinking
a view of the world that doesnt encourage support
from corporate leadership.
It doesnt matter whether such a mindset is
because of hard-wired differences IT attracts
people who are inherently analytical and rational,
'90s
'00s
The Environment
Applications Portfolio
Automated business processes; electronic
commerce; knowledge management; virtual
organization and supply chain reengineering.
Executive Attitudes
IT, particularly the Internet, viewed as
transformational, a driver of strategy; IT
investments now more attractive in terms of
costs and time scales
The CIO
Role
Internet developer and manager
Web-Based
Era
require companies in almost every industry to change
the way they do business.
Consider recent customer initiatives at home
improvement retailer Lowes. During the economic
downturn, rather than focusing exclusively on costs,
Lowes was thinking about the customer experience,
according to Ron Blahnik, the companys VP/IT
Engineering. With the top two players in the home
retail industry (Home Depot and Lowe's) accounting
for just 28 percent of the $450 billion market, there
is a lot of room to grow if the company can figure out
ways to engage customers and deepen the companys
relationship with them.
Tasks
Develop new business models for the
Internet; introduce management processes
that leverage the intranet
17
The Environment
The CIO
Applications Portfolio
Deep vertical industry focus;
blended elements of hardware,
software, and network
technologies, which optimize
process results and ROI
Role
Business visionary, industryspecific manager
Executive Attitudes
Real-time situation awareness
and automated analysis to help
firms solve smarter and more
complex business problems
Tasks
Build more industry-specific
solutions, as the task of
optimizing the value of
assets and liabilities will vary
dramatically from industry
to industry
Sources:
Andrew H. Bartels, Smart Computing Drives the New Era of IT Growth,
December, 2009.http://blogs.forrester.com/vendor_strategy
Jeanne W. Ross, David F. Feeny, The Evolving Role of the CIO, August 1999,
MIT Center for Information Systems Research white paper
Snapshot of a
Reincarnate CIO
Filippo Passerini joined Procter & Gamble as a systems analyst in its Italian offices in 1981. For two decades, Passerini held both
technology and global business posts within the $80 billion consumer products giant before being named CIO in 2004. Today,
Passerini, a native of Rome, retains his CIO title but he is also president of P&Gs Global Business Services (GBS) unit, one of
the companys four pillars that form the core of its organizational structure. The GBS unit was created in 1999 to handle the
companys IT needs, and its unique business structure has saved P&G more than $600 million through shared services over the
years. Rather than being viewed as simply a services organization, GBS is itself a brand within the company and Passerini has
used his post to broaden the impact on technology throughout P&G. Prior to 2004, IT was a separate organization but as CIO,
Passerini brought IT into the GBS fold. He changed the name from IT to Information and Decision Solutions so that the focus
would be less on providing technology and more on providing business solutions. Passerini believes that IT people are often given
short-shrift and are, in fact, well-equipped to be change agents within the organization. //
19
Snapshot of a
Reincarnate CIO
Philip Clarke, CEO-Designate, Tesco
Philip Clarke first worked at supermarket giant Tesco as
a 14-year old shelf stacker in his native Liverpool. As the
son of a Tesco store manager, the famed British retailer has
literally always been a part of Clarkes life. After earning
his university degree, Clarke returned to Tesco in 1981
and has spent his entire career at the worlds third largest
retailer, its $95 billion in sales behind only Wal-Mart and
Carrefour. As Tescos CIO, Clarke has managed to combine
his oversight of the companys technology efforts with deep
immersion on the business side. He has not only sat on
Tescos board since 1998 but he served as a store manager,
a buyer, a marketer and the leader of the companys
international expansion, especially across Europe and the
Far East. Tesco operates in 14 countries and has planted
a flag in the U.S with its Fresh and Easy stores. Clarke
managed the companys supply chain and added the CIO
title in 2004. Overseeing technology for a global retail giant
with more than 2000 stores and nearly 500,000 employees
is a daunting task, especially when that company has been
in a major growth mode for more than a decade. But when
Sir Terry Leahy, Tescos acclaimed CEO, announced his
decision to step down in March, 2011, he and the board
didnt hesitate in naming Clarke as his successor. //
21
Straight
Talking
Dispatches
From the
Front Lines
This section is the heart of this issue of CIO Straight Talk, the presentation of a diverse array of CIO and
other voices. Some of the articles, based on in-depth interviews, feature the experiences of individual
CIOs or others who have overseen IT implementation projects. Other articles are concise case studies that
examine the ways companies have addressed various IT challenges.
A number of other pieces look at current issues affecting CIOs. In fact, most of articles focus less on
technology than on broad concerns of top technology executives. All of the articles which are loosely
grouped into four sections about different types of value creation relate to the day-to-day work of IT
professionals.
The articles arent meant to offer definitive solutions that apply to the situation of every reader. Rather, they
are designed to stimulate thinking about the challenges faced by the CIO and to what degree the solutions
represent transformational responses to those challenges.
The companies mentioned in the articles and the case studies are HCL clients. Many of the featured ideas
and insights grew out of HCLs work with the company or the featured CIO.
23
Many Brands,
One System
// Virginia Guthrie
Position: Chief Information
Officer and Senior Vice
President for Information
Technology
Company: Dr Pepper
Snapple Group, U.S.
Professional Background:
Virginia helped drive
the legal and technical
separation from Cadbury
Schweppes P.L.C., putting
in place the team and
processes for DPS to
operate as a stand-alone
IT function. Earlier, she
had been CIO at Coors
Brewing Company and
handled leadership roles
at Frito-Lay and Celanese
Corporation.
Education: Bachelor of
Science, Western Kentucky
University; Master of
Business Administration,
University of Dallas
Having been a CIO in the beverage industry for more than 10 years (and
having spent many more years as a consumer packaged goods industry
finance executive), Ive lived through some dramatic technology and
business shifts during my career. But few things could have prepared me
for the challenges of my last four years as CIO at Cadbury Schweppes
and now the Dr Pepper Snapple Group (DPS), which was spun out
of Cadbury as a separate company in 2008. Though DPS is a new
company, it is at the same time a huge, thriving business made up of
more than 50 top brands of carbonated soft drinks, juices, teas,
mixers, waters and other beverages. With names like Snapple, Motts,
7Up, Canada Dry, A&W, Schweppes and Welchs, DPS is one of the
largest beverage companies in North America, with $5.5 billion in sales
in 2009.
Unlike a CIO at a true start-up, which has a clean technology
slate from which to build efficient IT systems, I inherited an eclectic
mix of technology infrastructures that somehow had to be melded
into a cohesive, state-of-the-art IT organization. And given the highly
competitive nature of the beverage marketplace, along with the
ceaseless need to cut costs and promote growth, my job has been
more than challenging.
// 25
Case Study
High-technology and manufacturing companies are increasingly looking toward streamlining their
procurement, spend and order management business operations to achieve a long-term competitive edge.
Case 1
Case 2
27
CASE 3
had its share of challenges and roadblocks. Not only were there
minor quality issues to start with, there was resistance toward
implementing best practices. For instance, the immediate fallout
of improved quality was increased turnaround time (TAT). 3M
was faced with the difficult task of improving TAT without
compromising on quality of order processing.
Part of the solution involved transforming people's
attitudes, and the partnership had to make use of its knowledge
of the Hawthorne effect, cognitive dissonance theory and
other workplace factors to help to increase the productivity of
the team. As people's attitudes were transformed, there was
ultimately a deep impact on productivity.
Business Benefits: Better Performance,
Better Relationships
For 3M, the improvements were tangible. Information
flow within the 3M supply chain network was made over.
Coordinated orders for timely shipment and real-time
information about the status of shipments helped improve
on-time delivery by up to 92 percent. Order processing
turnaround time improved markedly. The average time taken
to process an order decreased from two days to three hours.
Thanks to increased responsiveness to customer needs, strategic
relationships with logistics providers and end customers have
been greatly enhanced. //
Reference:
Aberdeen Group, "The Spending Analysis Benchmark Report Dissecting a
Corporate Epidemic," January, 2003
Measuring and
Managing the
ROI of ERP
By quantifying returns on its IT investments, both in terms of cost
savings and service improvements, the Birmingham City Council
determined that it realized $600 million in cashable benefits over
three years.
When people talk about business process reengineering and technologydriven transformation, they tend to think about corporate entities. But
we in the public sector face similar if not tougher challenges within
our organizations, and as Corporate Director of Business Change of
Birmingham City Council (BCC), I face the same difficult challenges as
any corporate CIO.
Located in the British West Midlands, BCC is the largest local
authority in the European public sector. BCC has a budget of more
than $4.5 billion and 57,000 employees serving the one million citizens
of Birmingham. It is responsible for providing more than 250 services
including social care, public health, social housing, the environment and
urban development. In other words, our pressures are more widespread
and demanding than most companies.
Having served as BCCs official CIO (what we then called Director
of Business Solutions and IT), I know what its like to drive business
transformation across multiple business units. I had a 500-person
department with a $70 million budget. Like other organizations, we
faced daunting changes due to financial pressures and the increasing
expectations of our customers. In April, 2006, BCC realized we needed
// Glyn Evans
Position: Corporate
Director of Business
Change
Organization: Birmingham
City Council, U.K.
Professional Background:
With 30 years experience
in local government,
in 2003 Glyn was
appointed Director of
Business Solutions &
IT at Birmingham City
Council to lead its
business transformation
program. As Corporate
Director of Business
Change, he ensured that
the transformation was
adopted, embedded
and implemented
across the council. Glyn
chairs the Society of IT
Management's Futures
Group and is a member
of the CIO Council, an
advisory body established
by the U.K. Cabinet
Office's e-Government
Unit, and the Local
Government Delivery
Council.
// 29
// 31
Case Study
// 33
Building
"One AEGON"
// Kees Smaling
Position: Chief Information
Officer
Company: AEGON N.V.,
Netherlands
Professional
Background: Kees has
more than 20 years
experience in Information,
Communication &
Technology (ICT) about
seven years of that working
on the other side with ICT
technology suppliers and
two years at AEGON.
He has diverse experience
in insurance, general
management, sourcing,
change and people
management. With
experience in both ICT
industry as well as the
financial services industry,
he brings a strong focus on
business-ICT alignment.
Kees was a panel speaker
at HCLs Global Customer
Meet 2010.
Getting to Strategy
As CIO, I am fully aware that my role is changing
and the focus must be on strategic business initiatives
rather than serving as the technology service
organization. Nonetheless, IT remains critical to the
success of any organization in the financial industry.
The whole industry is information-centric and
though that is not much different from 20 years ago,
the focus on IT today is far more strategic.
In order to confront these daunting business
challenges, AEGON embarked on a Loyal
Customer program aimed at customer retention
by remaking the way customers interact with the
company. You can say that the focus on efficiency
is just to stay in the game, and the focus on the
customer is more to win the game. We decided to use
social media (Twitter, etc.) as a method for getting
closer to our customers and learning what they really
want. The aim is to build profitability and effective
business programs using initiatives that target growth
through innovation, better use of capital and creating
customer-focused organizations.
To that end, we created the Shared Customer
Contact Center Program, a project aimed at allowing
customers to access all of AEGONs various products
through a single portal that would bridge our
traditional business silos. The aim was to create a
// 35
British Telecom
as we did in the past. Having new and unprecedented
communications with our customers means that we
are more aware than ever of their changing needs.
So transforming customer requirements means that
we must have flexibility and agility to meet these
changing business requirements.
Given the time and costs of building the new
infrastructure, the Shared Contact Center project
drew some criticism along the way. We had to prove
to the business side that all this back-office work was
worth the time and money. We had to build trust
with the business units because we were taking people
out of the comfort zone of a single silo having its own
technology infrastructure. The portal connects across
Case Study
Right First Time This is intended to enhance the enduser experience by delivering services right the first time and
reducing cycle time required to repair defects and problems.
// 37
// 39
Early Benefits
At AIG, we go through a rigorous business case
process for everything we do, and we believe this
project has a positive net cost benefit. It easily
meets our threshold for justifying the work. With
anticipated cost savings and the opportunities for
increased revenue generation from projects we would
otherwise be unable to handle without the eSignature
capability, we believe the project has more than
justified itself.
Though we are early in the adoption of the
application, we already see that weve created an
environment in which this capability can be reused
and leveraged in other situations. For example,
today we ask our customer to complete a paper
form, and we cant process a service request until we
receive written authorization. This tends to slow up
our processes, which inevitably leads to dissatisfied
customers. It also impacts the productivity of our
distribution partners.
Among the benefits weve already identified:
There has been a reduction in policy application
runarounds, which means more satisfied
agents and agencies along with better customer
experience, which could translate to more business.
We now have a streamlined approval process, a
one-step signing and automatic validation process
that eliminates several manual steps.
Though its not the only improvement, eSignature is
a core element in trying to significantly improve our
customers experience when they do business with
us. Our industry is a very paper-form, regulationintensive business. The more we can use eSignature
technology to make that part of the process easier for
our customers and distributors, the better our ability
Leading
By Example
Quest Diagnostics CIO created an Innovation Orchard designed to
generate revenue for IT projects and serve as a model for innovation in
the company.
There are few industries under more intense pressure than health care.
Everyone wants the very best care but everyone also rails at the everincreasing costs of such care. At Quest Diagnostics our goal is to provide
high quality services that will improve health outcomes for patients while
also minimizing or even lowering the cost of health-care delivery for
providers. At the same time, we have to continuously innovate to gain
entry to new markets around the world.
As Vice President of Information Technology at Quest Diagnostics,
my challenge is to align information technology with our corporate
business goals and act as a strategic business partner. And thats just
the beginning. Of course, we must provide the traditional IT products
and services in an effective, efficient manner. But today, thats just table
stakes. I have no interest in being just an order taker. There is always
pressure to deliver high quality IT, but there is a mandate to go well
beyond that. Like other proactive IT leaders, I also have to focus on the
companys top-line growth through innovation and help identify and
create competitive advantage.
// David Evans
Position: Vice President,
Information Technology
Company: Quest
Diagnostics Incorporated,
U.S.
Professional Background:
David joined Quest
Diagnostics in 2001
as Executive Director,
Laboratory Operations
Systems, and was named
Vice President, Diagnostics
Systems and Services, in
2006. He previously served
in a variety of management
positions at the American
Red Cross and spent the
early part of his career in
technical sales.
Education: Bachelor of
Arts, Richard Stockton
College
// 41
// 43
Case Study
Veolia
Lack of reliability and difficulty in managing real-time, twoway communications with a mobile staff
// 45
Going Mobile
in Wiltshire
// Patrick Geentry
Position: Assistant Chief
Constable
Organization: Wiltshire
Police is a police force in
the southwest of the U.K.
covering an area of 3,490
square kilometers, serving
a population of more than
half a million citizens.
Professional Background:
Pat joined the force in July
2009 from Humberside
Police and lives in
Wiltshire. He is a member
of the Chief Officer Group
with responsibility for
Citizen Focus, Contact
Centers, Learning &
Development, Professional
Standards, Justice and
Partnerships. He is also
working with Wiltshire and
Avon & Somerset officers
toward Special Branch and
Major Crime Collaboration
and chairs the MAPPA
Strategic Management
Board and the Local
Resilience Forum for
Wiltshire.
// 47
// Rob Hornby
Position: Chief Information
Officer
Company: Wealth
Management Group,
Old Mutual P.L.C.
Professional Background:
Rob joined Skandia, the
Swedish financial services
company in 2007, just
after it was acquired by
Old Mutual. Before that, he
had been at Sky Television,
where he was Director
of Software Delivery and
Support and CRM Program
Director. In his career,
he was a co-founder of
a software business and
spent seven years in
consulting.
Education: Bachelor's
degree, Master's degree,
Aston University, U.K.
Changing
Contracts
On the Fly
Skandia faced an all-too-common CIO headache: a radical change in
the business and a long-term outsourcing agreement ill-suited to the
new environment. Flexibility saved the day.
// 49
Managing Expectations
As CIO, I faced another challenge. I had to manage
expectations inside the company as well. The first
thing I have done is offer complete transparency and
honesty about the situation we are in. Ive never tried
to make it look better than it was. My job is to very
clearly articulate the risks and challenges we face.
The second thing has been to be very creative about
the way weve responded to this situation. We sought
My Takeaways
I recently sat at a round table with 11 CIO
counterparts discussing outsourcing, and not one was
fully satisfied with the arrangements that he or she
had. But not one would consider going back to before
he or she had outsourcing. Major shifts are likely to
continue in the financial markets over the next five
years, and no one can predict what will happen. Were
confident in general terms that we have proved we
can pull off this kind of transition, even though it
remains a work in progress. So Im confident but also
cautious. The ecosystem in which our products are
delivered to the world today is not a finished model.
It works better than the previous model, but we also
know it doesnt work as well as we want it to.
One of important lessons Ive learned from this
experience is that you must have an outsourcing
contract that is as much about changing the contract
as it is about the services you start with. You need
to assess suppliers against a scenario in which most
of what you asked them to do would change. There
are very few companies that can predict the next
five years, and therefore, our contracts cant pretend
that they can predict the future either. You need to
think about how your partners would respond, how
you would respond, and how the framework would
respond. In other words, you need to be treating your
outsourced partners as strategic before getting into this
kind of situation. You have to have the relationship in
place before this happens. Its very difficult to build a
relationship while a crisis is happening. //
// 51
Case Study
Dixons Retail
// 53
Getting Ahead by
// Chuck Ciali
Position: Chief Information
Officer
Company: Teradyne Inc.,
U.S. is a leading supplier of
automated test equipment
in a $5 billion marketplace;
$1.1 billion in revenues
and 3,600 employees in 35
countries.
Professional Background:
Chuck has been CIO of
Teradyne Inc. since 2005.
He joined it in 1998 as
Director of Enterprise IT
Infrastructure. Earlier, he
worked with FTP Software
and Digital Equipment
Corp. Chuck is an adjunct
member of the Computer
Science faculty at the
University of Vermont.
Education: Bachelor
of Science, Rutgers
University; Master of
Science, University of
Vermont
Getting Along
// 55
2. To transform
applications. HCL
helped us bring about
a series of significant
transformations to the application portfolio by
cross-leveraging best practices and leveraging the
HCL technical and domain functional experts.
The Results
We are still in the middle of our application
transformation, so it is too early to comment on those
results. But there have already been dramatic results
from the partnership. Among the successes:
We consolidated our two ERP systems into one.
In so doing, weve given operations, finance and
sales a single, end-to-end view of the customer
order status, and we are now able to commit to
specific delivery times. It is critical to be able to
provide our customers with an accurate delivery
date so they can do their own production
planning. Weve
achieved greater than
90 percent on-time
delivery and taken our
lead time from
12 weeks down to
six weeks.
Weve significantly
increased our engineering efficiency and moved
our cycle time from really poor, by industry
standards, to among the best from 90 days
down to 14 days. Given the cyclical nature of
our business, if you miss a market window, that
business might not return for 18 months.
Reference:
Allie Young, Ian Marriott, Gartner Research, Teradynes Outsourcing to HCL
Shows How Transparency, Flexibility Deliver Outsourcing Value, May, 2009.
ID No. G00166530
// 57
The way we look at the IT blueprint is pretty simple. It's really around
determining the value that IT brings to the business. And within that
value, what are the core operating principles and priorities that IT
delivers. We look at IT as a percentage of the companys revenue. We
track the value that we get from the IT expenditure. That is one way
of looking at how we start to construct the blueprint. The next step is
to identify the enabling services and how those services are orientated
in delivering a program that supports the core businesses. Once our
business partners determine their needs from a go-to-market standpoint,
the next logical step is to identify how IT supports that go-to-market
strategy within a fixed algorithm, while ensuring that we add value and
efficiency to the business. The entire process takes us about nine to 12
months to draw up our five-year blueprint, which we call our strategic
initiative plan. We work with our business partners to map out their
key business opportunities and how IT will support them. We then
continue to work on that five-year plan proactively and update it as the
market evolves.
// Bruce
Carver
Virginia
Guthrie
Position:
Position: Vice
ChiefPresident
Information
and
Chief Information
Officer
Officer
Company: Dr Pepper
Company:
Cummins Inc.
Snapple Group
is a U.S.-headquartered
Current Focus: Need
$10 billion corporation that
Professional
Background:
designs,
manufactures,
distributes
and services
Need
engines and related
Education: Need
technologies.
Professional Background:
Before Cummins, Bruce
had been VP and CIO at
Dana Corp., a tier-one
automotive parts supplier,
responsible for global
information technology
programs. He has also
served at PepsiCo as VP
and division CIO for the
PepsiCo Beverages and
Foods Division.
Education: Bachelor
of Science in Finance,
Virginia Polytechnic
Institute; Masters Degree
in Human Resources
and Organizational
Development, DePaul
University
Creating the
IT Blueprint
Bruce Carver leads the Cummins global IT organization and is charged
with helping the company generate and manage information in a way
that drives business growth and profitability. In this interview, he talks
about his company's IT blueprint and how it is shaped by and helps
shape the company's business.
How do you think growth will be redefined as traditional financial
measures reflect a social impact? Do you think IT has a role to play
in this transition and if so, how?
The answer is yes. I think it's all around the concept of value and
social and environmental responsibility. For our customers and our end
users, it's really about the value that we add. Our IT team supports our
businesses Web presence and how the various products and services
are presented to our customers, and it performs back-office functions
that consume a lot of resources. What I mean specifically by this is that
it's really around what is the value that we provide by delivering the
right information and IT services at the right time. Our ability to do
this impacts the cost algorithm and the profit algorithm and provides
efficiency to product development, and the way the company works
allows us to be a responsible consumer of environmental resources
(primarily our consumption of energy resources).
In line with that would be the second trend around making desktop
devices smaller and leaner. Leveraging virtualization as well as enterprise
computing from a centralized standpoint and adding less cost at the
desktop level should be the focus. In the consumer space, when we
look at the desktop, I am anticipating that the market will start moving
to devices that can actually save a lot of expense through investing in
smaller and less complex devices because your back end is much more
complex and much more robust.
The third trend is the virtualization of where people work. This is the
whole idea of virtual teams and how these teams do their work from
multiple, disparate locations. IT suppliers who support our application
development and back office (support desk and data center operations)
are typically remote to our core business locations. These teams
collaborate virtually across time zones. As a multinational organization,
// 59
we have many touch points, and those people in most cases will never
sit in the same room with one another. So, worrying about how you
have solutions that allow these teams to collaborate efficiently and still
produce a product that is usable and defect free is very important.
What were the essentials you had
in mind when you created your
blueprint for IT?
// Virginia Guthrie
Position: Chief Information
Officer
Company: Dr Pepper
Snapple Group
Current Focus: Need
Professional Background:
Need
And fourth would be around what's the overall business impact, which is
really the role of the three prior items.
In the shared services group, the fifth would be around what's the
efficiency that we get from processes and output.
The next would be the organizational and professional growth of our
IT team.
And the role about the first six is really around what's the overall IT
environment that we have created.
Education: Need
We look for partners with a strategic focus and the ability to execute.
They have to do more than the traditional development and create
robust tested solutions at a reasonable price. The one thing that is
important in creating those partnerships is showing that the partners
work in the same way that our core teams do around the world, because
we cannot have our partners work in a different way than we do. Then,
it's really about showing that the partners chemistry is aligned with our
corporate culture and that everybody is working on the same strategic
plan and the same operational structure. //
// Kris Hillstrand
Former CIO, TXU
CIOs @ HCL:
// Satish Chandrasekaran
Former Vice President/
Technology, Target (India)
// Greg Black
Former CIO, American
Safety Insurance
// Raymond Siebert
Former CAO/CIO,
Acceptance Insurance
// 61
// 63
Solution
Spotlight
This and the following section
represent a detour from the rest of
the issue, which primarily features the
FPO
A systematic approach
to developing your
CloudStrategy
Everyone has his or her head in the clouds these days. And that can make it difficult to know where
27th Jan 2010: The world waits with bated breath to witness Steve Jobs unveil the much anticipated Apple tablet
computer at the Yerba Buena Center in San Francisco. Meanwhile, far away in a suburb of Delhi, a team of 10
engineers is busy conceptualizing a sales productivity enhancement tool for the iPad though as of yet, none of
them has seen the about-to-be-unveiled device.
Today, their idea has materialized as an interactive order management and tracking system that runs on the
iPad platform. Move over, bulky laptops or tiny tablets: This is feature rich, portable and highly interactive. It is
simple to use and aesthetically pleasing, with a paper-like feel and with interactive features that can take the pain
out of order management for sales representatives.
The integrated functionalities cluster around predefined task flows and information reusability for recurring
scenarios, context-sensitive display, advanced search, and dynamic analytical capabilities. The platform is
currently being piloted across two micro-verticals.
Incubation of ideas like this is the hallmark of HCLs Employees First, Customers Second philosophy,
which drives responsibility for product innovation, customer solutions, and organizational change down in the
organization. (See Employees First, Customers Second, Harvard Business Press, 2010.) For a demonstration
model of the sales tool, write to iORDER@hcl.com.
important, explain the pros and cons of each to the CFO and the CEO. A systematic approach to
defining and assessing the options can make navigating the world of clouds clearer.
Solution Spotlight
// 67
Figure 2
IT systems.
of cloud.
service providers.
Figure 1
Messaging &
Collaboration
Enterprise Apps
Data-Sensitive
Apps
Productivity Apps
HCM, CRM,
Learning Mgmt
Web Apps
Development Environments
Legacy Apps
Test Environments
Apps Tightly
Coupled with
Hardware
Mainframes
POC/Lab
Infrastructure
Storage & Backup
Archiving
Infrastructure Apps
Transient/
Unpredictable
Workloads
On
Premises*
Internal
Private
Cloud
External
Private
Cloud
Public
Cloud
Application
Platforms
Infastructure
Business Imperatives
Business Criticality
Traditional/Next Generation
Network Bandwidth
Organizational Structure
Demand Elasticity
Technology Complexity
Storage Requirements
existing hardware.
Complexity
Environment (Test/Dev)
Server Computing
Manageability
Connectivity
Process Maturity
Database
Security
Regulatory/Compliance
Interoperability
Client Computing
a private cloud.
Data Sensitivity
Support Coverage
Recovery/Business
Continuity
Solution Spotlight
// 69
such as these.
Labeled Envisioning Our Cloud Strategy, the poster represents the sort of explanatory sketch you
might draw at a whiteboard in talking to non-IT executives and helping them understand your cloud
options. It includes four areas that the company should consider in determining whether an element of
its IT landscape is a good candidate for migration to a cloud and, if so, to what kind of cloud.
Tool
Area of Focus
CRI, CEF,
Migration++
MTaaS
Managed Tools
as a Service
Nimbo
Agora
Cirrus
And it includes a spectrum of cloud options indicating where certain elements typically fall.
Representations of sticky notes suggest that a useful discussion can develop around where, in the case
If the poster is missing from your copy of CIO Straight Talk, go to:
of additional applications.
and priorities.
and IT teams.
inside them. //
Solution Spotlight
// 71
What Lies
Ahead?
Three Outside Perspectives
on Tomorrows CIO
Much of this issue features the thinking of CIOs about current problems they face
and solutions they have devised to address those problems in a way that benefits the
business. Their insights are based on firsthand experience down in the trenches.
We wanted to close the issue with the perspectives of three nonpractitioners able to
offer a broad view of the changing CIOs world, but from different viewpoints: seasoned
journalist, academic researcher and industry analyst. These observers are:
Maryfran Johnson, Editor-in-Chief of CIO magazine and events, a unique dual
role directing editorial content for CIOs print publication as well as conference agenda
development, speaker recruitment and related editorial functions for the magazines
events. A frequent media commentator on the IT industry, she previously was Editor in
Chief of IDG's Computerworld magazine and Founding Editor of CIO Decisions magazine.
Jeanne W. Ross, Director and Principal Research Scientist at the MIT Sloan Schools
Center for Information Systems Research, where she lectures, conducts research and
directs executive education courses on IT management practices. Her research examines
organizational and performance implications of enterprise initiatives related to enterprise
architecture, IT governance, outsourcing and business agility.
Ellen Kitzis, until recently a Group Vice President and member of the CIO Research
Team at Gartner. Her 24 years of experience in the IT industry include time not only as
an analyst, researcher and consultant but also as a practitioner she is a former VP for
Strategy, Service, and E-business at Compaq. She also is the co-author, with Marianne
Broadbent, of "The New CIO Leader" (Harvard Business Press, 2005).
You might call these short essays, summaries of interviews with the three women,
straight talk from the outside.
// 73
The IT Function's
Uncertain Future
Jeanne W. Ross
Director and Principal Research Scientist at the
MIT Sloan School's Center for Information Systems
Research
// 75
15 Questions
A checklist of things to consider as you
begin your annual IT planning
Every CIO knows the challenge of trying to meet
three different goals when considering investments
and initiatives for the coming year: 1) reduce IT
costs, 2) improve operational efficiencies and, most
ambitiously, 3) leverage IT to create new business
capabilities capabilities that may ultimately
transform the entire business. (See "How To Pitch
Your Transformation Plan," p.61.)
Appendix:
15 Questions
A checklist of things to
consider as you begin your
annual IT planning
23%
3%
Outsourcing
10%
35%
Infrastructure Operations
16%
Total
100%
Appendix
// 77
Operating Model
Cost Bucket
Applicability
Cost Bucket
What It
Involves
What It
Involves
Cost Bucket
Outsourcing
Applicability
Benefits
operating model.
VV Apparao (Apparao.vv@hcl.com);
HCL Idea
Owners
CS Muralidhar (CS.Muralidhar@hcl.com)
Owner
technology obsolescence.
What It
Involves
Benefits
Applicability
Involves
capability
What It
speed of resolution
Initiative
Cost Bucket
Support
Applicability
Initiative
Applications
Benefits
fixed-price model
Benefits
Philosophy
infrastructure
business domains.
What It
Involves
HCL Idea
Owners
HCL Idea
Owner
(RamlaxmanS@hcl.com)
Benefits
Support
Applicability
services model.
Elapsed time is the total time taken to execute a task. This takes into account
not only the CPU processing time but also time spent in waiting for I/O (disk
IO or network IO). Since I/O operations, such as reading files from disk, are
performed by the OS, these operations may involve noticeable amount of
time in waiting for I/O subsystems to complete their operations. This waiting
time will be included in the elapsed time, but not CPU time. Hence CPU
time is usually less than the elapsed time.
defect prevention.
Appendix
// 79
Applicability
Initiative
Cost Bucket
Applicability
the following:
Applicability
What It
What It
compliance process
Involves
Involves
What It
Involves
sourcing model
the buck
techniques include:
Benefits
What It
Involves
health assessment
a department.
hoc requirements
standardization, modernization
best practices
skilled employees
Benefits
and consolidation
HCL Idea
Owners
HCL Idea
HCL Idea
Owners
Owner
reduced cost
Frees up management bandwidth so the
company can focus on its core business
Gains in quality, innovation and continuous
improvement through a process approach
HCL Idea
Owner
Appendix
// 81
Initiative
Initiative
Initiative
Cost Bucket
Cost Bucket
Applicability
Applicability
What It
Involves
for example).
What It
What It
Involves
Involves
What It
Involves
implementing or adopting:
techniques are:
Identify and analyze content touch points
within the enterprise
Design a unified content architecture with
optimized platform license usage
HCL Idea
Owners
Benefits
data management
communications framework
organization
demand management
records-management norms
HCL Idea
Owner
Manas Chakraborty
HCL Idea
Owner
(Manas.Chakraborty@hcl.com)
Owners
Kandasamy Ramanujam
(Kandasamy.Ramanujam@hcl.com);
Rajesh Agrawal Ramesh (rajeshramesh@hcl.com)
Appendix
// 83
Applicability
Management Process
Applicability
What It
Involves
What It
Involves
Benefits
the contract.
Benefits
savings opportunities
HCL Idea
Srivathsan Sridharan
Owner
(Srivathsan.Sridharan@hcl.com)
HCL Idea
Owners