CIOs Must Have the Ear of the CEO

The Chief Information Officer is not a second-rate executive position as some would claim. Also, CIO, does not, as the saying goes, stand for “Career Is Over”. And the CIO position is certainly not “dead”, contrary to rumors to the contrary. As Mark Twain once said, “rumors of my death are premature”.

There is this notion that CIOs deserve a “seat at the table”. The “table” in this sense is the CEO staff, as a peer exectuive with the CFO, COO, and assorted VPs of Operations, Sales, etc. Much is written in blogs (included my own), magazine articles and discussed in forums about the justification for this belief.  The main idea is that CIOs have to be more ‘strategic’. Supposedly, the mechanism for becoming more strategic is most often termed “alignment”.

Let me so bold as to suggest that things like ‘contribution’ and ‘value’ go right along with ‘strategic’. There are plenty of tactical issues with managing a business. Things are dynamic, a flow, requiring a dexterity of seamlessly migrating through issues of business performance: sales, product quality, customer satisfaction, supply chain, etc.  Information Technology is clearly threaded through these and other areas of the business. However, the trick is to demystify and ‘dis-abstract’ this stuff so that you are not spending half of the monthly strategy meeting talking about who should be allowed to get a Blackberry or an iPhone.

So, the big picture has something to do with not being the “moron in the room”.  True executive ”peers” suffer fools badly. The thought that there is somehow a special microscope for CIOs is nonsense — unless it takes one to see the value that the CIO is delivering. It is more about culture and being in the “club”. The one thing about clubs full of highly-ambitous people is that they are territorial and very picky about letting others inside.

Prior to being hired for a CIO position a few years ago, the HR executive told me that the company was thinking about slimming down the number of direct reports to the CEO. Thus, they were considering having me report to the CFO. My response: a non-starter. If they were trying to reduce the number of CEO reports, I had just the solution: have the CFO report to me.

After an awkward chuckle or two, the HR executive was back to his senses. I wasn’t asking for a seat at the table. I expected one. It is all about grabbing a chair and acting like you belong there.

Bottom line

quit whining. If you do not have the business-savvy to earn the respect of fellow business executives, then you deserve to be seated in the gallery.

For more on this topic: Business Solutions: Death of the CIO?, by Nadia Cameron; The Death of the CIO–Again, by Brian Watson; Is the CIO a “pinnacle” position?, by George Tomko; and
What Do CEOs Want from CIOs?, by Maryfran Johnson.

Image: Arvind Balaraman / FreeDigitalPhotos.net

©2010 George M. Tomko All Rights Reserved

Why would I do such a thing? Why would anybody? Simple – it fills (or at least promises to fill)  a major void and lots of gaps that many of us have. Anybody with one arm longer than the other from lugging around laptop poundage knows that light, powerful, practical — AND fun, slick, cool — is quite a gap filler.

Most of all, though, is that it won’t be long, in my humble opinion, before business and personal computing is forever blurred by the phenomenon of  ”bring your own device”. That device can be an iTouch, iPhone, iPad, iMac — i-anything — as much as it can be a net book, tablet PC, laptop, desktop, smartphone or even Web TV.

It will soon make little sense for companies to be acquiring, distributing, managing and dealing with PCs for individual workers (except for the shop floor or other dedicated or location and function-specific scenarios). Indeed, many people have gear at home that is better and faster than the crippled, locked-up, expensive and unfriendly standard-issue work machine that they get every four years or so.

Desktop virtualization, what some call the “dynamic desktop” is the answer that abstracts the user personalization and experience from the actual device. Corporate policies and security are managed at the server and most any device can be supported for access to the company’s e-mail and internal business systems. Even more sophisticated and powerful applications such as engineering can even be served up to the right device.

Back to the iPad. I am a road warrior. I am sick of lugging things around. I use the devices that I want to use and work with my clients to connect to portals and the cloud rather than taking one of their laptops. The iPad form factor will be copied, morphed and will ultimately be a metaphor for a simple, functional and WOW device that can connect to something like Citrix’s XenDesktop and act like a work machine when it needs to.

So, it is not so important that it is Apple. They have simply shown that they are the current kings of tapping in to the unmet needs of the market which is causing a movement away from the malware infested, middling laptops and PCs that can’t do much of anything practical anymore.

©2010 Tomko Tek, LLC All Rights Reserved. iPad picture grab Copyright © 2010 Apple Inc. All rights reserved

By George M. Tomko

Many cloud computing boosters use the selling point that establishing large amounts of storage or computing requires no “up-front capital investment”.  Pleading before the gods of capital within corporations has been a bane for IT and business operations functions forever. All those appropriation request forms and cash flow analyses – not much fun when you want the servers installed and the software loaded.

What has always been interesting to me is that more thought, analysis, decision-making and accountability goes in to managing the capital investment portfolio than you often see in managing operating expenses. The irony here is that “op-ex” is very often many multiples larger than the “cap-ex” spend in any given fiscal period. If a $400 million company (in terms of revenue) has an operating profit of 20%, then the company managers spent $320 million with likely much less oversight than the $15 million that they might have spent on projects.

At the  end of the day, there is no free lunch. Just like leasing became the way to ensure “technology refresh” every 3 years, let’s make sure that cloud computing and all something-as-a-service offerings don’t wind up costing your company more or that the standards of decision-making are usurped by being able to fly more stuff under the financial controls radar.

The saying “you can pay me now or you can pay me later” became a “tag” line in old oil filter commercials where the idea was that you might pay more now for a premium filter but you would be avoiding the cost of replacing the entire engine later.  Of course, the assumption is that you would own the car long enough for this to pay off.  This was in the era when the majority of people traded-in and bought new cars in 3 or 4 year cycles.  Not long after, 3 year leases perpetuated the cycle.

The reality, then, was that most people wound up paying now and they got to do it over and over because later never came!

Another myth that is related is the 3,000 mile oil change. Again, another marketing bonanza because it got people to pay to replace their oil and filters twice as often as the auto manufacturers recommend in the owner manuals.

So back to op-ex and cap-ex and buying infrastructure/software/platforms as-a-service. If I take the op-ex view, it is almost always an incremental view as in year-over-year budgets and the dearth of zero-base reviews. If I take the cap-ex view, everything is an investment and is evaluated as cash-flows over a defined “economic life”. This takes rigor and commitment and the potential for more eyes to see and more ears to hear.

It is not a bad thing to have the option of paying for something as a service. However, it is a bad thing if the selling point is that you get to relieve yourself of the burden of evaluating and justifying the all-in costs of doing it one way or another.

Remember, you can pay now or pay later. Some times, it is nice to get to pay later.

What do you think. Please leave a comment.

©2009 George M. Tomko All Rights Reserved

This is about the 20 millionth blog post or article that has been written with some reaction to last week’s *new* Google Chrome OS announcement. For the most part, it was a surprise announcement – mostly because it was not leaked to the press.

I have posted about Google in a mostly positive light (“Google: No brag, just fact”; “What’s the Thing with Bing?”) but I do not own any Google stock or have any financial interest whatsoever, directly or indirectly. And, my point-of-view is going to be widely different than most of what is out there. Since I am not wedded to any particular technology, all I have to ask is, why would or should I care (as a CIO, consultant, consumer, etc.)?

I have read some great posts (PC Mag’s Michael Miller; CIO.com’s Steven J. Vaughan-Nichols) that have really thought out and carefully presented the author’s arguments in the following major categories: 1) Microsoft killer; 2) Linux killer; 3) gives Google the keys to the world; 4) is it really ‘open’;  5) is this really ‘new’? All good questions and perspectives, but the answers don’t really mean much.

So, to the fundamental question: why would I (or you) care? I guess I would care if it changed my (or your) life in some way or another, positively or negatively. So, if I am a CIO, I might be concerned about this throwing a monkey-wrench into my carefully thought out strategic technology plan.

Maybe I was planning on rolling out Windows 7. But, now, I might be worried that I am going to be playing the IT version of the game “52 card pick-up”.

Now, as a consultant, I might welcome all of this uncertainty. Consultants get rich when there is a lot of head-scratching going on and someone has to come in and tell the folks what to do.

As a technologist, I might be fuming (or celebrating) that this is going to be marginalizing the good work of the open source community and related foundations that have coordinated and sponsored projects to get some cohesion in a smaller set of more robust Linux distros. Why might I be upset? With Google “branding” and financial might, they might be a force that pulls from, rather than nurtures, the continuing development of mainstream (read Ubuntu) Linux. On the other hand, I might now have many more opportunities to work on the newest of the new things.

As a consumer, I can already get a netbook with Linux and OS X on a Mac, will there be something magical that happens with new product capabilities?

Naw. Bottom line is that the CIO will move forward, as planned.  The technologists will have spirited debates like they always do and groups will splinter off – as they always do. As a consumer, I’ll just be wondering what new feature I will get to pay for in some new gadget.

At the end of the day, it is all about innovation, competition and all the things that need to keep happening to advance the state-of-the-art and either create new value or steal more share of what is already there. Microsoft still stands out in the ‘crowd’. Of course, that ‘crowd’ is becoming one of more or less equals.

And I never, ever, thought that Java would be an Oracle product.

So things change.

And that is exactly what we want. Without it, we still might be running Windows 98 SE. There is so much stuff out there, it will be decades of disruption before the things we talk about now are as ho-hum and boring as telephones, flushing toilets and electricity.

Until then, it will be like Al Bernstein once said, “Success is often the result of taking a misstep in the right direction.”

©2009 George M. Tomko All Rights Reserved

As the hype continues regarding “Cloud Computing”, there are now tales from those who have recently experienced the current offerings of these services.

Also, there are more and more seasoned, veteran practitioners of information technology (“IT”) that have been at conferences, had prosepctive suppliers call on them and, in a number of cases, carefully “dipped their toe” in the water on a self-contained project.

But, at the end of the day, does anyone really know what cloud computing really is? I am sure this video with a number of well-known names will clear it up for you:

httpv://www.youtube.com/watch?v=6PNuQHUiV3Q

Further evidence that the hype is doing little to clarify or capture the mind share of IT leaders, except, perhaps for curiosity, comes from Tim Anderson and his recent post “Cloud Computing Survey: More Fog Than Cloud” :

“…the survey was undermined by the fact that most of those surveyed admitted to not knowing what cloud computing is. The reason is not ignorance, but the many and various ways the term is used. The common strand is that it is something to do with the internet, but even that is undermined if we describe virtual on-premise servers as a “private cloud”.

Looking at it another way, as James Urquhart recently posted: “Cloud computing is an operations model, not a technology”.

And, for now, we need to leave it there. Rather than being dazzled with the details of the underlying technologies that are being strung together to form new product offerings, we should be focusing on what this means for fundamental computer operations.

The first thing that people seem to be realizing is that the vendor-supplier relationship has some new (and perhaps re-ignited old) dynamics that are now highly-sensitised. One of the first that comes to mind is the issue of “trust”.

For IT people, trust is built on a number of foundational elements. In some ways, there is an unspoken knowledge between technically-oriented individuals about whether the person they are dealing with has been-there, done-that, in terms of delivering the “goods” on a project or two. More respected are those that have had to live with their “creations”. That is, they had to stick around and live with the results by supporting things post go-live. In other words, the solution had to work. It is great when it happens that the person(s) you are dealing with on the other side know what they are doing and can back it up with the real-world cuts, scrapes and bruises of putting these solutions in place.

When it comes to something like cloud computing, though, you are not only reliant on others to deliver something (like a product or solution). You are going to be entrusting some very valuable assets (i.e. data) behind the unknown bastions of the cloud sourcer’s world. [I think I just "coined" a phrase: "cloudsourcer".]

As Bruce Schneir put it in his recent blog post:

“IT security is about trust. You have to trust your CPU manufacturer, your hardware, operating system and software vendors – and your ISP. Any one of these can undermine your security: crash your systems, corrupt data, allow an attacker to get access to systems. We’ve spent decades dealing with worms and rootkits that target software vulnerabilities. We’ve worried about infected chips. But in the end, we have no choice but to blindly trust the security of the IT providers we use.”

Of course, the simple recognition that trust is a key factor is not enough. Those of us who have put together and been responsible for large-scale outsourcing contracts know a bit about how bad things can get on the inside of these service delivery “factories”. It is simply a nightmare management issue.

Anyone who thinks that taking out your credit card and ringing up Amazon to stand up some servers real quick probably feels pretty good about not having to traverse the enterprise gauntlet for capital or project funds and their project is well on its way.

But, unless you are a start-up or other entity that has little to no legacy applications, integration issues, highly-sensitive data, multi-national compliance issues, customer service level requirements that you can guarantee to your own customers, etc., cloud computing is going to be something that you nibble around the edges on for a long time. After a while, there will be settling of standards and the market will judge the winners and losers.

But making a full-blown decision now to put it all on the line is simply out of the question. It is not about the paint not being dry. The wall hasn’t even been sanded and primed and is not even ready for paint.

To continue Bruces Schneier’s thoughts:

“Trust is a concept as old as humanity, and the solutions are the same as they have always been. Be careful who you trust, be careful what you trust them with, and be careful how much you trust them. Outsourcing is the future of computing. Eventually we’ll get this right, but you don’t want to be a casualty along the way.”

Is the tide turning against cloud computing? In its present form, I think “Yes”. Already, we are seeing new morphing of the idea of the cloud computing construct known as “SaaS” (Software-as-a-Service). Now, of course, we see “CaaS” for computing-as-a-service as a new marketing spin.

How many names can we give to the old idea of time sharing, network computing, etc.? The answer is probably “endless”. The bottom line is that customers are currently dealing with a curiosity that will someday have to be a bulletproof, industrial strength for of outsourcing. For that, it has a long, long way to go.

I have a lot more to say on these matters as you will see in future posts. Our companion blog, CIO Rant, is also full of some deeper discussion into some of these issues. I invite you to take a look.

In any case, I would greatly appreciate comments, which are easy to post.

I put out a set of exploratory questions to see how people see this.

Through a number of direct conversations, comments to this and other blogs and the use of other forums, some very good ideas came forth. To be sure, I am going to be hunting for more. Surprisingly, there does not seem to be much in the public domain on this subject.

Consider Google search results for May 6, 2009 where all of the words appear :

• 95 million for web pages that have the word: consultants
• 57 million for web pages that have the words: do consultants
• 23 million for web pages that have the words: do consultants deliver
• 10 million for web pages that have the words: do consultants deliver value

Now, Consider Google search results for May 6, 2009 where the exact phrase appears:

• 95 million for web pages that have the word: consultants
• 14 thousand for web pages that have the words: “do consultants”
• 88 (eigthy-eight) for web pages that have the words: “do consultants deliver”
• 62 (sixty-two) for web pages that have the words: “do consultants deliver value”

Interestingly, 53 of the 62 referred back to this blog.

So, suffice it to say that whether this is a top-of-mind question or not, it isn’t asked (and answered) very much.

There are certainly other questions that offer insights, such as “What do consultants really do, anyway?” or “Why did I hire the consultant anyway?”.

You can gleen from many of these that either people were satisfied customers or they weren’t satisfied. A generalization can be made that consultants give consultants a “bad name”. That is, all consultants get painted with the same brush. There have been enough overpriced, arrogant, know-it-all, blow-hards that the truly good ones can be overshadowed, at least initially, by the collective angst of organizations who feel betrayed when senior management brings in experts to tell them what the internal staff has already told them.

But, things are changing. One is that the economy has driven more people from retirement back into the workforce. While it is a tough job market, the best and most experienced are recognizing that putting up a shingle of their own and contracting out their knowledge and experience as a consultant, temporary worker, project resource or other paid contributor.

I will be conducting further research on this trend and what consulting firms and their customers have to say about it. In the meantime, please read the comments that were generously contributed by John Moore, Tracy Austin, Virginia Steinberg, and Chris Bunnett.