The Role of the CIO

The Role of the CIO Charles Assaf Francisco Gonzalez-Meza Sean Athans Diego Siri Agenda       Introduction Role, skills and responsibilities for 21st Century CIO Assessing the performance of the CIO Real life cases of CIO’s Recommendations from personal experiences and insights Q&A Historical Background     Traditional Brick and Mortar Growth of E-Commerce Internet Bubble Cost Cutting and Becoming Lean Line of business External and Enterprise Drivers Monolithic business Complex Business Models IT Metrics Business Metrics Single CIO Role Multiple Responsibilities ‘The Genus CIO is a Mutating Species’ Role of the CIO     Business visionary CIO’s must help business executives to understand and appreciate challenges of IT enablement for new business models. A successful CIO must anticipate and implement the required changes (short- and long-term), not simply react to them. Understand and effectively manage business risk. Role of the CIO Measure Six Imperatives Define the Role of the CIO       Anticipate LEAD Deliver Lead – Bridge business and technology Anticipate – Sense key trends Organize Strategize – Shape demand and synchronize Organize – Orchestrate for lighter IS Deliver – Provide cost-effective and timely services Measure – Know where you stand and why Strategize Skills Required        Flexibility and adaptability Big-picture oriented Clear communication of ideas Personal credibility and leadership Technical and financial understanding Broad background Team approach and team building The Effect of Technology Eras Web-based Complexity Business Exploitation of IT Distributed Mainframe Era Time Strategic Contribution Management vs. Technology Management Priorities Technology Priorities  E-business process   Embracing the customer   Exploiting ERP, CRM  Sourcing management  M&A management    Managing IT costs   E-business capability Business-adaptive IT designs, CRM Supply chain management Legacy migration Strengthen infrastructure Support for intangibles Criteria for a Successful CIO Assess the performance of the CIO Strategy Tactical •General •Industry/project specific •Sample performance criteria •Performance Process Criteria for a Successful CIO Strategy ♦ Is the CIO articulating and linking business and IT maxims to deliver value ? ♦ Has the CIO implemented an effective IT governance ? ♦ Is the CIO executing upon the enterprise endeavors agreed ? ♦ Is the CIO looking for new IT enabling opportunities across the business ? ♦ Is the executive team aware of the value the CIO is bringing to the company? ♦ To what extent is the CIO engaging in peer coaching and mentoring ? Performance Process Tactical Sample Criteria ♦ 1. Set Performance Criteria Is the infrastructure delivering according to the resources invested? ♦ How effective is the relation with IT suppliers? ♦ Are the Service Level Agreements being met ? ♦ Is the ERP project being delivered on time and 2. Periodic Assessment of Performance within budget ? ♦ Etc… Meet Criteria? Performance Process Tactical Sample Criteria ♦ 1. Set Performance Criteria Is the infrastructure delivering according to the resources invested? ♦ How effective is the relation with IT Repeat onsuppliers? a ♦ per phasebeing basismet ? Are the Service Level Agreements ♦ Is the ERP project being delivered on time and 2. Periodic Assessment of Performance within budget ? ♦ Etc… Meet Criteria? Distinctive Features       Demonstration of versatility and preparedness to take risks Inclusion of succession planning Possession of requisite business knowledge and acumen Vision of enterprise IT impact in 2 to 3 years due to CIO performance Achievable performance criteria that will enhance contribution to the enterprise Maintaining a level of technical competence The E Priorities of the CIO Energizing Enabling enterprise strategy and initiatives new business initiatives Executing Exploiting cost-effective solutions technologies, sourcing opportunities and benefits The E Priorities of the CIO The Four E’s Energizing Enabling Executing Exploiting Claude Cargou – EVP of IT AXA Group CIO of AXA since 1991 ‘The ideal role of a CIO is that of a godfather—someone who runs the IT family.’ Since Cargou joined AXA:    With mergers and acquisitions became largest insurance group in the world ($73.7 billion in 2000). Transformed IT organization from centralized to an international force Manages offices in 60+ countries, 11,200 IT professionals and budget of $1.9B Cargou's implemented IT structure is:   CEO & CIO governance team – 50 business & technology leaders from all 50 AXA's companies; Plans AXA’s IT Future Information Services Board - CIOs and CEOs from AXA's 10 largest companies; Decides on groupwide IT investments "Ninety percent of strategy is in execution, and 90 percent of the execution is in communication” "a CIO's job is never done." Energizing enterprise strategy and initiatives Jose Luis Luna – WW CIO CEMEX Joined CEMEX in 1987 as Head of technology development Few industries more basic or old economy than cement Pre-1985:    Old cement family company. No differentiated service. Commodity business. 1987-2002: CIO brought to solve efficient delivery and unforecastable demand. IT became part of business strategy. IT department built with alignment in mind. Processes of firm based on three tools:    Cemexnet Dynamic Synchronization of Operations e-CEMEX "This [CEMEX] is not just a good technology application. It's a brilliant business design. They have taken the ultimate commodity product and showed that you can achieve differentiation through service.” David Bovet, (VP of SCM Mercer Management Consulting) Enabling new business initiatives Karl Wachs – WW CIO Celanese Joined Celanese in 2001 – Objective: cut cost. Direct reports: 0 ‘Bigger picture’: Cost cutting is just part of the equation:    Industry commoditizing Consolidation coming Centralized management Today – Driver of the biggest transformation within the company    OneSAP: Consolidate seven SAP entities into one Budget: $60 million dollars ROI estimated: 50% Executing cost-effective solutions Dawn Lepore – CIO Charles Schwab Promoted from IT department in 1993 to CIO Relevance - "A CIO is nothing if she doesn't make sure IT continues to stay responsive to customers and the business overall" CIO as a people leader - "CIO is as much a people job as it is a tech job. I want IT to be a place where people can do the best work of their lives." Charles Schwab challenges:    Before: Struggling with pure players Response: Led web project to serve 4.3M users Result: Hands-down leader in on-line trading Challenges:    Technology? No – Easy part Creating momentum Avoiding Outsourcing Exploiting technologies, sourcing opportunities and benefits Typical barriers for a successful CIO  Hierarchical structure of the company CFO: Budget CAO: Accountability     Available resources fluctuation Too many IT genius within the senior management team Short term planning Awareness of CIO possibilities Recommendations BATMAN DON’T FLY BATMAN SERVES GOTHAM CITY BATMOVIL AND GADGETS ARE NOT CHEAP HE BUYS ONLY WHAT HE NEEDS THE RED PHONE IS FOR CONTACTING THE COMMISIONER, NOT HIS SECRETARY