by November 17, 2005 0 comments

The days of technology deployment just because your competition was doing it are long gone. Today, every rupee spent on IT requires a justification, and not without a good reason. The competition is increasing, and customers are becoming ever more demanding. Companies have to fight harder than before to retain their customers. This definitely calls for better products and services, which essentially translates to higher costs of operation. Of course, the changes in govt. policies don’t help either many a times. The introduction of VAT for instance, had most companies running in a frenzy trying to incorporate it into their accounting systems. In such a tough scenario, companies typically end up doing two things-cost cutting and discounting.

While this is a fact of life, it’s not the foundation on which a business can grow. Every business needs investments to grow, and typically companies would prefer to focus their energy on investing in building their brand, doing market surveys and running customer loyalty programs. That’s where the role of the captain of IT comes in. If you as the IT in-charge can convince your management that Information Technology is an equally worthy investment if not more, and that all the business activities they’d like to carry out can be better performed using IT, then you’ve done your job. 

Unfortunately, that’s the toughest challenge, because it requires an understanding of the business and how it functions. It’s tough because most IT managers are brought up on a staple diet of servers, protocols and networking. Ask them about the latest buzzwords in the IT world, and you won’t hear the end of it, but ask them about the marketing campaign of the company’s latest product, and they’ll start floundering for words after a while. Many companies, therefore, end up appointing an IT head with a finance background, which also has its demerits-the person would understand number crunching, but not technology! What’s required therefore, is the right balance of technical and business knowledge. An IT manager who can understand both IT and business will be able to marry the two successfully.

IT needs to be understood so that the company’s IT infrastructure can be best utilized, and new IT purchases be made wisely. And business needs to be understood to determine which IT solution is the best fit, which IT partner can best service it, and how can the IT team manage it effectively. 

In this story, we take you through the ten mantras, which, we feel, will help you manage your IT infrastructure better, and should, therefore, form a core part of your IT strategy. The role of a CIO today has evolved from being technology head to a multi-faceted personality. 

You need to be a technologist, a business head, a fortune teller, a negotiator, a project manager and much more. The reason is simple IT spends all functions in the organization, so whoever manages it must understand a little bit of everything. So the first one is about understanding your business needs only then can the best solution be worked out. While in theory, this sounds simple, it’s extremely difficult to carry out in practice. 

In fact, in a survey, we did last year, of the key IT concerns that IT managers face, one of the key concerns was that of
convincing top management to invest in IT. Similarly, another challenge they faced was in trying to convince the various business managers to use technology. Since the management understands business and not much of technology, the IT manager has to learn to speak their language. While this is tough, it’s not impossible. Let’s look at some of the ways. 

MANTRA 1: Understand your business needs

Out of operations and into strategy
PCs not working, Internet bandwidth is choked, there’s a new worm on the prowl, the list of troubles goes on and on for an IT manager. These are never-ending issues, so if you continue to remain caught in them, you’ll never be able to fulfill the first mantra. So the first thing to do is to take some time out of these day-to-day operational issues, and spend some time with your business managers. 

The objective is to understand what they go through every day in running their departments, and whether the company’s IT infrastructure is able to support them in any way. 

Be prepared, however, that besides receiving business ‘gyan’, you might also receive a lot of comments (not necessarily positive) about how IT doesn’t work. This is good in a way, since it brings you face-to-face with ground realities. 

As IT is one of the few functions in an organization that’s spread across all departments, it’s important that IT managers don’t live in their own ivory towers. They must be able to interact with all users and understand their problems. 

Learn to identify the burning issues
You definitely are not required to learn each business manager’s functions by heart and become an expert at them. The objective here is to know enough to be able to identify the exact problem in order to devise and present a convincing case on how IT can help resolve it. This will not happen over night, so you will need to spend enough time with enough people in the business unit to understand the issues they face. More often than not, the key problem will be surrounded by a lot of other issues. Let’s look at this with an example. For instance, the key business need for a manufacturing firm would be to bring out more innovative products in the least possible time. So the head of manufacturing would always be under extreme pressure to improve product lifecycles, while keeping the inventory and production costs under control. 

Compliance: Should you be concerned?
Absolutely. The Indian CIO should also be concerned about compliance, not because of all the noise about Serbanes Oxeley and HIPAA but more so from how adversely could non-compliance affect your company’s business. If you’re the IT head of a BPO operation, for instance, then compliance to data-security standards would be definitely something giving you sleepless nights. You would all have heard the story of how a reporter from a UK publication managed to extract sensitive data from an Indian BPO executive over the phone. Compliance with Serbanes Oxeley and HIPAA becomes important for Indian companies catering to clientele in the US, and likewise for other standards elsewhere. In the US, compliance has become a major issue, and companies are offering some pretty senior positions for compliance experts. Their job is to go hand-in-glove with the IT heads to ensure that they follow the norms. These companies are spending out of their nose to make their IT infrastructures compliant to standards. The Indian companies who service them would also need to spare investments for doing the same. 
Compliance isn’t just about conforming to a few well-publicized standards in other countries. In India, law governs the duration for which banks have to retain customer records. Similarly, law also governs the time period for which an ISV has to maintain e-mail logs. Indian law also requires external auditing of every company’s financial records. The role of the CIO becomes important in all of this because increasingly IT is being used for business process automation, records management and official communication. Most large enterprises today have implemented ERP, and in most of them, the accounting has moved from manual ledgers to digital spreadsheets. You have to ensure that standards are put in place for information security. A bigger challenge is to ensure that there’s no fraud happening in these systems. Record management or document management isn’t just important for cleaning up the clutter of documents. It’s important from a legal point of view as well. You should be able to pull out financial data whenever it’s needed, like for an audit, or when a company is bringing out an IPO. That’s where the true value of IT infrastructure would be recognized. In the last point, increasingly e-mail is being used as a tool for business communication. Due to this, besides ensuring the mail server is always up and running, you have to ensure that confidential information doesn’t leak out. Many companies in the US resort to e-mail monitoring and logging to prevent this. They even use specific software that retains e-mail, which could be used as potential evidence in lawsuits. Indian companies also have to wake up to this fact. What if a disgruntled company employee sends confidential product specifications to your competition by e-mail? At that time, you would wish that you had monitored all e-mail more closely, and would forget about whether it’s an ethical practice or not.
There are many other facets of compliance. Another is where CIOs push compliance in their organizations as a differentiator from competition. Many customers would prefer a company conforming to legal standards than a company that doesn’t. So compliance is important, and with IT becoming a key business enabler, CIOs must take it seriously.

Realistically speaking, the last thing on such a person’s mind would be to sit down and explain the problems to an IT manager, who doesn’t know a thing about manufacturing. So while you might be overflowing with ideas on how IT can help the manufacturing unit, it’s of no use if the manufacturing head is not willing to listen. 

This can be quite a challenge, and needs to be addressed with care. So you might even need to speak to others as well, than just the manufacturing head, to understand the problems. 

Build the right case for IT
This involves two things. One is to come up with an IT solution that best resolves the problem. Taking the above example of a manufacturing firm further, the simplest solution to their problem would be to move product development to a computer-simulated environment. 

If computer simulation is already being used, then try and improve the workflow between them. If this is already in place, then allow the customers to also collaborate on the same. Whatever the level, the technology is available, people have to be convinced to use it. That’s the second step. How you convince them is up to you. It may involve going beyond technology and talking about the key benefits to users and the management. 

Elements of an IT strategy

Inputs from Deepak Jain, GM&Business head-Managed IT services, Wipro
The goal of any IT manager is to put up right architecture that’s aligned to the organization’s business strategy. For instance, one goal for a telecom company is to acquire enough subscribers to become the market leader. The IT function has to be able to support this business strategy. For that to happen, the requirement from IT would be to provide strong backoffice operations or call center with a good customer addressing/complain addressing system. It has to be a high-availability system, else it will result in lots of dissatisfied customers. The IT architecture has to be designed based on the business strategy. To extend the example, if the same telecom company wants to launch new services for its customers, then IT should help in creating the new offering in the shortest possible time. After the offerings are made, it should be charged to the customer, and finally, IT should be able to help in collecting the money from the customer. For instance, globally customers using broadband connections are charged according to the downloads, but in India, people pay a flat fee. That’s because the IT support system doesn’t support this kind of billing. The IT architecture therefore has to be flexible enough to align with the business needs. All this has to happen while keeping the costs under control. At the end of the day, your business strategy is aimed at generating profits, and not for setting up the IT infrastructure.

So instead of talking about the configurations of high-end graphics workstations, and the nitty-gritty of Gigabit Ethernet networks, one would need to convey the exact impact on the product lifecycle, what would be the exact time and cost savings against what was being done previously. 

The management likes to see numbers, and you can show the right numbers only if you know the business problems being addressed. 

Anil Chopra, Sujay V Sarma

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