Balancing Strategic and Tactical Resources for Efficient IT Results

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Technology leaders from Sanmina-SCI, Arizona State University, Black & Veatch, and Puerto Rico Electric Power Authority on:

Balancing Strategic and Tactical Resources for Efficient IT Results

Manesh PatelCIO & SVP Information Technology, Sanmina-SCI

Adrian SannierVice President and University Technology Officer

Arizona State University

John VoellerCKO, CTO, Senior VP, Black & Veatch

Maribel Picó PiereschiCIO, Puerto Rico Electric Power Authority

These days, the CTO/CIO must be more than an adept technologist; he or she must also be a key strategist who understands the orga-nization’s business and can strategically develop and tactically drive

the right technology plan to meet its needs. Accomplishing this involves a number of steps: assembling a competent and innovative team, engaging them to think creatively, developing detailed implementation blueprints, remaining informed of new innovations, and collaborating with company leadership. This ExecBlueprint provides today’s CTO/CIO with guidance for how to balance strategic and tactical priorities to deliver solutions that not only “keep the lights on” but also add value by reducing costs or cre-ating differentiation. Included are specific suggestions for organizing IT governance bodies as well as selecting employees for strategic and tactical assignments. What can be accomplished when IT and the business work together? One author convinced his CEO to start blogging. Another author shared how, through IT innovation, his company was able to actually change the price points of their industry. ■

Action Points

I. What Are Common IT Challenges?In today’s global environment, IT must grapple with unprecedented issues to meet their organization’s technology needs, including conflicting technologies; far-flung staffs, sites, and vendors; new regulatory requirements; and persistent threats to data security. Consequently, balancing strategic and tactical resources has never been more important.

II. The Bottom LineThere are so many measurable ways that strategically planned IT solutions can add value to a company: they can render the business more flexible and efficient; they can save costs on labor and systems; they can improve the customer’s experience; and they can even create economies of scale that ultimately affect the price points for an industry.

III. Must-Have Roles for the CTO/CIO in Planning Strategic and Tactical InitiativesWhile the CTO/CIO is expected to maintain specific skills and expertise within the department, they must also serve the broader organization as a key strategist who stays abreast of technological developments, continues to assess the organization’s IT needs, presents complex ideas to business leaders, and promotes IT’s value to the organization.

IV. The Golden Rules for Managing Both Strategic and Tactical ProjectsNow that many applications can be implemented out of the box and managed by vendors, IT departments should begin dedicating more staff time to the work that differentiates their organization. Not only does this mean that teams should be able to work on a variety of projects, but also to address larger questions such as, what is the network strategy?

V. Essential Take-AwaysBalancing strategic and tactical resources requires careful planning and ongoing collaboration not only with your company leaders but also with your IT teams, users, and vendors to ensure that strategic resources remain focused on the mission of your organization while retaining sufficient tactical resources to get the actual job(s) done.

Contents

About the Authors . . . . . . . . . . . . . . . . . . . . . . . . . . p.2

Manesh Patel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p.3

Adrian Sannier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p.9

John Voeller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p.12

Maribel Picó Piereschi . . . . . . . . . . . . . . . . . . . . . p.15

Ideas to Build Upon & Action Points . . . . . . . . p.18

© Books24x7, 2009 About the Authors ExecBlueprints 2

About the Authors

In addition to his current roles at Black & Veatch, John Voeller currently serves as consultant to the Office of Science and

Technology for the Department of Home-land Security, and the ASME fellow in the Office of Science and Technology Policy for the White House. Previously, Mr. Voeller was OSTP representative to the Interagency Incident Management Group that advises Secretary Chertoff in times of national emergency.

His primary responsibilities and accom-plishments have included the development of strategic and tactical plans for agency, inter agency, and national initiatives. He has gathered and analyzed all possible Fed eral information sources to provide agencies and offices as well as their stakeholders with a comprehensive picture of past and current efforts. Specifically, he formulated the mas-sive database of all HS/HD/IC R&D projects across all agencies from 1986 to present that is used by agencies for planning.

Earlier in his career, he served as CEO and president of Data Discovery, Inc., General Integration Corp, and Nuhands Corp. Data Discovery sold his recursive, search technology. In addition, he designed Powrtrak, which moved the company’s sales from $200 million to $2 billion in six years.

John VoellerCKO, CTO, Senior VP , Black & Veatch

Manesh PatelCIO & SVP Information Technology , Sanmina-SCI

Manesh Patel is CIO and senior vice president of information technol-ogy at Sanmina-SCI. In this posi-

tion, Mr. Patel leads a global IT team supporting all aspects of Sanmina-SCI’s operations.

Starting with Sanmina in July of 1997, Mr. Patel progressed through a number of senior IT management positions, until the merger with SCI in December 2001. During this period, Sanmina’s revenues grew from $600 million to over $4 billion, which pro-vided Mr. Patel with opportunities and

challenges across all aspects of IT solutions, management, and organization. In response, he has provided leadership in the develop-ment and implementation of IT strategy, which enabled international expansion, customer-focused services, and the success-ful integration of over 10 mergers and acquisitions. A key element of Mr. Patel’s IT strategy has been the deployment of com-mon ERP, engineering, and shop floor sys-tems and processes on a global basis.

After assuming the CIO position in September 2006, Mr. Patel has continued to

globalize the IT organization in conjunction with Sanmina-SCI’s $7 billion operations in 18 countries.

Mr. Patel began his career at Ford Motor Company’s management program in Europe in 1984. In 1989, he moved to Silicon Valley and, over a period of eight years, led the IT organizations at two startup companies while completing his Computer Science Masters coursework at San Jose State University.

Dr. Adrian Sannier is vice president and university technology officer at Arizona State University. The for-

mer Stanley Professor of Interdisciplinary Engineering at Iowa State University's Department of Industrial and Manufacturing Systems Engineering, Dr. Sannier brings 17 years of experience in both the public and private sectors.

At Iowa State, Dr. Sannier was one of the founders of the Human Computer Interaction program and, in addition to research and teaching, was associate direc-tor of ISU's Virtual Reality Applications Center.

Prior to joining the Iowa State University faculty in 2001, he was vice president and general manager of Engineering Animation,

Inc., a leading provider of 3D computer graphics software. Dr. Sannier’s responsibil-ity was to lead a group of 200 programmers and artists in creating products for a diverse group of companies, from Mattel and Disney to Ford and General Motors.

Adrian SannierVice President and University Technology Officer , Arizona State University

Maribel Picó Piereschi has served as corporate information officer (CIO) of the Puerto Rico Electric

Power Authority since 2001. She has served at the utility in roles of increasing respon-sibility since 1990. Since becoming CIO, she has managed the implementation of multiple corporate information systems for critical business areas, on time and within budget. She is responsible for all aspects of strategic information technology planning, implementation, and support as an integral component of the business plan. Specific duties include directing technical support for the infrastructure architecture and

Oracle e-business operation; managing and operating the multiple platforms and appli-cations of the Corporate Computer Center; and developing and maintaining corporate business continuity and the disaster recov-ery plan.

Previously, Ms. Piereschi was the utili-ty’s QA supervisor and led technology teams to develop standards in all areas of IT infrastructure. In this role, she designed and implemented quality and strategic plans for development and maintenance systems. She also developed and main-tained the corporate and strategic informa-tion security plan, which included the areas

of Internet access and e-commerce, as well as the corporate data warehouse.

Since 1984, Ms. Piereschi has also been an associate professor at the Polytechnic University of P.R., and taught courses in Math (Calculus 3), Computer Languages, Industrial Engineering Courses (including Probability and Statistics for Engineers), Quality Control, Simulation by Comput-ers, Financial Accounting, Engineering Economics, and Management Information System (MIS).

Maribel Picó PiereschiCIO , Puerto Rico Electric Power Authority

☛ Read John’s insights on Page 12

☛ Read Adrian’s insights on Page 9

☛ Read Manesh’s insights on Page 3

☛ Read Maribel’s insights on Page 15

Manesh PatelCIO & SVP Information Technology , Sanmina-SCI

© Books24x7, 2009 Manesh Patel ExecBlueprints 3

Preparing IT to Meet Business NeedsStrategically, we have consistently focused IT on providing our busi-ness the following:

1. Speed — Improving the velocity of our business, from transaction processing to higher-level functions such as month/quarter-end close pro-cesses, internal and external reporting, and supply-chain communications

2. Flexibility — Enabling our busi-ness to adjust to changes, whether internally driven or by our customers, suppliers, or other factors. This includes operational flexibility at the transactional level, but also responsiveness at higher levels to new customer programs, mergers and acquisitions, sup-ply disruptions, etc.

3. Cost — Providing the lowest cost of service delivery, while maximizing value

Because specific programs and projects may address one of these areas while conflicting with others, understanding the variables and making balanced decisions is criti-cal. Having a clear view of these three areas enables a strong and consistent framework for decision making. While it is rare that all or even two of these areas are addressed in a specific activity,

these are where we focus to realize the most strategic value. A persis-tent force working against the realization of these business bene-fits, however, is IT complexity. Without constant vigilance, IT complexity grows almost magically and leaves long-term costs and con-sequences. New initiatives are care-fully reviewed to identify how they might affect the complexity of the IT environment and the respective cost or benefit.

Initiatives with Strategic BenefitsA good example of a major initia-tive that addressed all three areas was the global rollout of our Ora-cle ERP system. This was started in 2002 and completed in 2005. Most of this effort was internally driven by IT, corporate departments, and our business units, using minimal external consultants. This approach required Sanmina-SCI to establish and develop project management, training, and other procedures that external consultants would have normally supplied. The result was that we delivered one of the largest single-instance Oracle ERP deploy-ments in the world for 10 to 15 per-cent of the cost of comparable implementations.

Clearly, the scale and scope of this initiative brought many chal-lenges, but the strategic benefits have been even more significant and include the following:

1. Enabled global process consistency and streamlining within and across all business functions

2. Allowed IT economies of scale and improved service levels in support of one ERP system.

3. Reduced the number of other ERP and peripheral systems and their associated costs and complexities.

4. Drove consistency of customer experience and information

Without constant vigilance, IT complexity grows almost magically and leaves long-term costs and consequences.

Manesh Patel

CIO & SVP Information Technology

Sanmina-SCI

Manesh PatelCIO & SVP Information Technology

Sanmina-SCI

“Sanmina-SCI maintains a flexible approach to assigning resources to strategic or tactical activity. Senior-level technical and management staff members with greater experience are generally more likely to be assigned to strategic initiatives, especially in the early concept and strategy phases.”

• With company since 1997; CIO since 2006

• In 18 countries; $7 billion in revenues

• Oversaw merger with SCI in 2001

• B.Sc (Hons), Aeronautical Engineering, Manchester University

Mr. Patel can be e-mailed at [email protected]

Manesh PatelCIO & SVP Information Technology , Sanmina-SCI (continued)


exchange. With the growing complexity of products and increasingly globalized supply chains, the value of working with one system worldwide has only increased.

5. Improved access to action-able information on direct-material spending. With direct material accounting for over 70 percent of revenue, management of this function is critical to Sanmina-SCI and our industry in general.

6. Established a model for driving common systems across the enterprise — product data management, shop floor, advanced planning, etc.

Consistency in IT CapabilitiesOur ongoing activities that are devoted to deploying or adjusting Oracle ERP for acquisitions, green-field sites, and restructuring ensure the continued consistency and value of ERP services across the enterprise.

Across our industry, there is a high level of consistency in the IT capabilities required. The real chal-lenge is that delivering many of these capabilities requires long-term planning and investment. This, combined with the dynamic nature of our industry and the sig-nificant cost challenges we all face, only serves to place a higher value on the ability to make strategic decisions. Many of our competitors have taken different approaches to ERP over the last 10 years with widely varying results in terms of cost, capability, scalability, etc. And some of those competitors are no

longer in business partly due to some of those decisions.

A key component of the Sanmina-SCI IT strategy is to invest in tar-geted innovation. Being selective in this area allows costs to be tightly controlled. We also prioritize areas that have strategic potential. As ideas go through the multiple steps of the innovation cycle (from R&D to full deployment), they are evalu-ated at each stage to ensure further investment is warranted.

Building and Maintaining Company SystemsAs a rule, we limit internal devel-opment to initiatives that provide unique or differentiating solutions or a cost benefit. The primary development areas, therefore, have been our shop-floor systems and some internal automation solu-tions. For ERP and other areas that use “standard” business functions, the majority of our systems are commercial solutions.

Almost every department and business unit has some point solu-tions that are internally developed. These are generally limited in scope and serve a specific function. For the majority of our business func-tions, we extensively utilize Oracle ERP — specifically the e-Business Suite.

Allotting Resources for Strategic and Tactical PurposesAcross the IT organization, we deliberately avoid hard boundaries of role and responsibility. Clearly, everyone has one or more primary functions, but the need to be flexi-ble and adjust to change requires every IT employee to take on tasks

and responsibilities based on need, skill set, and priority. This includes the ability to move from opera-tional support to tactical projects and strategic initiatives. Some of our more technical staff members who support day-to-day operations have limited exposure to strategic initiatives, especially during the early concept or design phases.

The overall mix in terms of resource and funding has not changed significantly in the last few years. Our desire to invest more on strategic activity is moderated by our continued volume of tactical work and funding constraints.

Balancing Major Changes in System ConfigurationOn a tactical level, new initiatives and projects come from all directions — customers, internal process im-provements, cost reduction initia-tives, compliance stipulations, secu-rity needs, and infrastructure requirements. Because we operate under constrained resources and funding, we must closely coordinate with executive management in order to balance all of these needs.

In the last three years, we have deliberately tried to reduce the number of major system changes. The primary drivers were a realiza-tion that the core systems already satisfactorily supported the major business functions. Also, the cost and disruption to our business units were becoming harder to jus-tify. This approach has allowed for redirection of some resources as well as some level of cost reduc-tions. Clearly, where major system changes are needed, they are being addressed.



The Role of Senior Management in Technology StrategyThe CIO is the primary driver of IT technology at Sanmina-SCI. This has not changed in the last three years. Where appropriate, the rele-vant business units and departments are consulted or give significant input to decisions, especially when the applications and services under discussion will be deployed by that business unit or department. Based on the scope and level of invest-ment, a review and approval by executive management, up to the CEO and COO, may be warranted. Since major elements of Sanmina-SCI’s IT strategy were established over five years ago, there has not been a need for significant changes in decision making and ownership. Also, Sanmina-SCI’s management approach involves direct ownership and accountability rather than matrixed or shared ownership.

In the last few years, depart-ments or business units have made most of the key decisions. These have involved in-depth reviews with the appropriate management. For example, a number of finance-driven initiatives required extensive coordination with the relevant management up to the CFO and the COO. Additionally, close inter-actions between different levels of IT management and staff, and their counterparts within the business, often led to tactical and sometimes strategic initiatives. A major factor that enables this type of “open” interaction is Sanmina-SCI’s low-overhead management style that encourages employees to lead and engage while minimizing formal structures and adherence to hierarchy.

Business Involvement During Development PhasesIT is the primary driver for design activities based on business require-ments. CIO involvement varies based on the significance of a proj-ect in terms of cost, scope, or criti-cality to the business. During the design phase, business involve-ment is generally limited. For more complex initiatives (especially for new and unfamiliar areas), we employ a more interactive design

approach with key business users. Then, we conduct a final review of the design (including potential options and trade-offs) with the respective business management prior to final funding and approval. Depending on which business units are potentially related to an initia-tive, management from one or more business functions will be invited to join the initial phases as well as the on-going advisory board. Overall, Sanmina-SCI’s flex-ible approach to IT–business engagement is a successful model.

Sanmina-SCI’s 5 Major Challenges inBalancing Strategic and Tactical Needs

1Balancing cost reduction initiatives with investments in ongoing

activity, innovation, and strategic projects

2Achieving effective teamwork across global teams despite differences

in time zones, language, culture, and lack of personal contact

3Developing leadership and innovation capabilities in

new and young managers

4Maintaining security in a virtual world that is increasingly being

maintained in remote, mobile, and partner locations

5Establishing real collaboration between the IT

organization and business partners



In rare instances, however, IT-driven projects do fail. Although lessons are learned and applied, further improvements are then war-ranted so as to identify risks and other factors that may derail an ini-tiative. Some of these factors are outside of IT’s direct control, such as business organizational struc-ture, skill set, and capability of business leads and management. While IT staff are encouraged and empowered to highlight such risks, results do vary, dependent as they are on human factors and organi-zational dynamics.

Comparison by BudgetThe IT budget at Sanmina-SCI is about 1 percent of revenue. We believe this is close to best-in-class in our industry for the types of ser-vices provided. Based on bench-mark data, this amount is well below that for other technology companies, especially OEMs. The comparison against other compa-nies in our industry is still favor-able, albeit much closer. We do not specifically break out strategic ver-sus tactical initiatives, but do track KTLO (Keep the Lights On) versus new activity (projects, initiatives, enhancements, etc.). The ratio is about 85 to 15 percent, with a

variation of up to 3 percent on a quarterly basis, which is generally addressed by staff that can work in either area based on need.

Measuring the Overall Effectiveness of IT Systems and ProceduresThe fast-paced nature of Sanmina-SCI’s business drives a culture of efficiency and effectiveness. This is true of the IT organization as well. In addition to learning and apply-ing lessons learned, a key charac-teristic of our management strategy is to look ahead and avoid or miti-gate potential issues before they arise.

Measurements are used and applied where they strictly add value. There is a conscious effort to ensure measurements do not become “navel-gazing” exercises. In general, measurement and track-ing is at a macro level in such areas as project management, milestone tracking, budget, etc. Where detailed measurements are needed, the preference is to enable manage-ment by exception rather than to find creative ways to present large data sets.

One area where the IT organ-ization has established detailed

tracking is in measuring employee work. Each IT employee is required to track hours spent on different types of work activity. Broadly, IT work largely falls into three catego-ries, in increasing order of scope and scale:

1. Trouble tickets (requests routed via the 24x7 IT help desk)

2. Work requests (enhancements, break/fix and analysis work, generally 10 to 80 hours in duration)

3. Projects (generally 160 hours or more of work), which fol-low the Project Management Life Cycle (PMLC) process for approval and execution

Establishing employee discipline so that this information would be quickly entered into the labor track-ing system took over six months. Many organizations, however, that try to implement similar levels of tracking fail at this step. The level of communication, cajoling, and resistance involved can be daunt-ing. Keeping a focus on the expected value and ensuring that employees understand the reasoning behind the documentation are essential to achieving timely and accurate infor-mation collection.

Value from the IT labor tracking systems has been realized in multi-ple ways:

1. Provides a detailed view of IT workload and activity. This is used to identify problems and opportunities for improvement, whether technological, organi-zational, or process.

2. Enables a chargeback capabil-ity to our business units with detailed data backup.

Expert Advice

The overall Project Management Life Cycle (PMLC) concept was established by the IT organization about 10 years ago. Over the years, modifications and improvements have been implemented to reduce unnecessary overhead and improve business engagement and visibility.

For the last few years, the PMLC model has been very stable. One area, however, where we could potentially improve would be to establish an execu-tive council to regularly review strategic and tactical initiatives to ensure align-ment with company priorities. Today this occurs on a more ad-hoc, as-needed basis with the relevant executives, and works reasonably well. The challenges of time and scheduling coordination may preclude a more formal approach.



3. Ensures that we have access to an accurate and timely view of projects, which is critical to ensuring that budget and deliv-ery objectives are on track.

4. Presents a macro and detailed view of ongoing support work (KTLO) versus new work. Reducing the cost and effort of KTLO while maximizing new work is an important objective, as it is for most IT organizations.

5. Enhances understanding of the costs associated with specific IT systems and services. This information is used to direct tactical and strategic projects.

Updating Systems to Better Support Strategic NeedsThe upgrades to Sanmina-SCI’s Oracle ERP and Agile (PDM) plat-forms that have been performed in the last three years have served to establish a strong platform for some time. Owing to advances in Oracle database and applications technology, combined with newer hardware platforms, the next round of upgrades will be required in the 12- to 24-month timeframe.

Current upgrade activity is pri-marily at the tactical level and includes the following:

1. Advance planning — Technology and vendor change combined with business use improvements and integration.

2. Brazil Oracle ERP — Separate project to meet new Brazil- specific government requirements.

3. RoHS and REACH environ-mental compliance — Essential

upgrades to either meet new requirements or changes to existing environmental regula-tions. These are primarily driven by the EU and China.

4. Partial migration of our shop-floor system to an open-source database — Primarily to reduce operational costs

In the next 12 months, a combi-nation of strategic and tactical ini-tiatives will lead to the deployment of Google Apps across the enter-prise. This is part of a strategic ini-tiative to leverage the Google platform for messaging and collab-oration services. In the long term (12 to 24 months), we expect improved capabilities and reduced operating costs. Increased use of virtualization for servers and desk-tops will also realize benefits in energy use, support cost, and scalability.

Top Challenges Facing ITSanmina-SCI has established a robust, world-class IT capability in the last five years. In addition to maintaining these capabilities and providing tactical enhancements, strategic questions are also being addressed methodically to ensure solutions are implemented in a structured manner. Specifically, the major challenges faced in balanc-ing strategic and tactical needs are:

• Balancing cost reduction initia-tives with investments in on-going activity, innovation, and strategic projects

• Achieving effective teamwork across global teams. Our coor-dinated effort to establish a more globally balanced IT

organization over the last five years has largely been success-ful. Now, the challenge is to ensure staff work closely together across distance and time, whether within the same team or across IT teams and with our business partners. Natural barriers such as time zones and distance are exacer-bated by factors such as lan-guage, culture, and lack of per-sonal contact. Management and staff are encouraged to actively break down these bar-riers, which seem to grow by themselves.

• Developing leadership and innovation capabilities in new and young managers. The dynamic nature of Sanmina-SCI’s business and consequent demands on the IT organiza-tion require flexibility com-bined with willingness to con-tinuously learn and develop. To succeed, senior managers must make a consistent effort and assign staff to projects that provide opportunities for lead-ership and innovation.

• Maintaining security in a more virtual world. As more work moves from an office environ-ment to remote, mobile, and partner locations, the chal-lenges of security grow expo-nentially. Currently, solutions and providers are mostly play-ing catch-up to these chal-lenges. This naturally leads to point solutions and generally restrictive practices to minimize security risks. Balancing risk mitigation with business pro-ductivity and efficiency is an ongoing challenge.



• Establishing real collaboration between the IT organization and business partners. In any large organization, the ten-dency to develop silos is a nat-ural phenomenon and difficult to break. Even though working relationships between IT and other organizations at different levels are relatively good, there is room for improvement. If we can more closely coordinate our efforts and work as one team to understand issues and develop solutions, we have sig-nificant potential to move the company forward.

Instituting New Policies and ProceduresOur focus in the mid- to short- term is to streamline and rational-ize policies, procedures, and processes. The aftermath of SOX

provides a rich opportunity for improvement in reducing the “fric-tion” of control policies and pro-cedures, while maintaining their efficacy. Other regulatory require-ments, whether legal, financial, or environmental, combined with internal controls and best practices, have established a comprehensive policy and procedure framework that in some areas causes inefficien-cies and impacts cost.

One relatively new area is the establishment of formal archiving policies, procedures, and associated IT capabilities. The initial momen-tum from legal and IT will be car-ried forward into the rest of our business over the next 12 months.

Balancing Resources at International SitesThe Sanmina-SCI IT organization is one global organization that is

distributed across 14 countries. Our local technical staffs that pro-vide desktop, LAN, and local appli-cation support in manufacturing plants are based in those locations. Management of these employees is generally within the three regions: Americas, Europe and Middle East, and Asia.

The “corporate” teams for infrastructure, applications, and customer-facing services are also globally distributed, but clustered in corporate or regional centers. These resources are focused on sup-port, development, and implemen-tation of projects and initiatives, independent of the geographic loca-tion. However, wherever possible and based on skill set and availabil-ity, we utilize staff members based in a location or region for projects in that locale. ■

Adrian SannierVice President and University Technology Officer , Arizona State University

© Books24x7, 2009 Adrian Sannier ExecBlueprints 9

Addressing Strategic and Tactical NeedsOur governance mechanism has changed significantly over the past several years to make sure that the technology agenda is closely aligned with the business agenda.

Addressing strategic and tactical needs is now a governance issue because it involves how we decide where to allocate resources and which things we are going to do internally versus buy from outside. Once we have determined that, we have to balance those internal resources in order to determine which are most important to the institution. Together with a set of executives who represent the vari-ous portions of ASU’s business — the academic, administrative, research, and global sides — we make decisions about how we are going to allocate resources and make sure that our projects are tightly coupled with the mission of the business.

This procedure, however, repre-sents a departure for us; in the past the technical agenda was largely set by technologists and business needs

were only marginally taken into account.

Core or Context: Supported Company SystemsAt ASU, we have a strict litmus test to distinguish “core” from “con-text.” Core activities are those that, when done well, can differentiate us from other universities. Context activities are those which, however important or critical they might be, cannot positively differentiate ASU from its competitors. Context sys-tems are those that we are trying to shed as quickly as we can; rather than building and maintaining them ourselves, we want to find a partner who will provide those services for us.

In the past three years, ASU has found partners to drive our main-frame, host our ERP, and manage our network. At our core, ASU still builds and maintains its high- performance computing cluster, and we maintain, drive, and advance our high-performance computing storage infrastructure. Unlike the commodity network, developing a leading-edge research and storage infrastructure is a part of the core university mission, and no partners exist who can provide the level of capabilities that our researchers need to compete.

The CTO’s Role in Prioritizing Technology StrategyAs CTO I am a full participant in a five-person committee that sets executive technology priorities. At the university, the CTO is the owner of the technology strategy and tries to knit together the vari-ous technology imperatives or

projects that the individual busi-nesses are trying to drive. It is my job to synchronize these areas so that the evolution of the business is integrated with the development of technology and to make sure that the business owners — the people responsible for the various facets of the university’s business — have a sense of how technology can influ-ence this process. Whether we’re talking about how Amazon’s Kin-dle is going to revolutionize the campus book store, how Apple will influence the deployment of

Adrian SannierVice President and University Technology

Officer, Arizona State University

“As we shift away from context activi-ties toward core activities, we are find-ing that a greater proportion of employees are now engaged on the strategic side with a shrinking propor-tion on the tactical side.”

• 17 years of IT experience in public and private sectors

• Former Stanley Professor of Interdisciplinary Engineering at Iowa State University’s Department of Industrial and Manufacturing Systems Engineering

• Previously vice president and general manager, Engineering Animation, Inc.

Mr. Sannier can be e-mailed at [email protected]

Expert Advice

In FY ’10, ASU will transition its network management from an inter-nal group to Qwest. In FY ’09, basic management of the computer net-work cost the university about $13.5 million per year. The 30-person inter-nal network group generated and processed some 15,000 individual expense transactions and more than 40,000 internal revenue transac-tions. In FY ’10 Qwest will perform an improved version of these ser-vices for $1.5 million less per year. In place of 15,000 expense transac-tions will be 12 monthly payments.

Adrian SannierVice President and University Technology Officer , Arizona State University (continued)


educational content, or how Google Apps for Education will drive col-laboration throughout the aca-demic and administrative enterprise, it is the CTO’s job to make the management team aware of what technology can do today. This means informing them on what current capabilities the institution has, how well these capabilities are meeting the university’s needs, and then illustrating what opportunities are going to emerge based on changes in technology.

At ASU, there is a multi-tiered process for keeping departments throughout the university abreast of what the central IT group is doing and keeping the central team abreast of the innovations that are happening at a smaller scale throughout the institution. For instance, the university’s college of business began using SalesForce.com as a way to manage their recruiting process. Projects like that are certainly more approachable on a small scale first, so it’s ideal for them to first emerge in an individ-ual unit. Experimentation is better done at the leaves than in the trunk of the organizational tree.

The central group’s job is to help identify which of these small-scale innovations might be helpful to most units, and then work to scale them up.

Assigning Staff to Strategic or Tactical AreasFundamentally, our strategy is to drive more employees up the value chain toward strategic consider-ations and use fewer of our own people in tactical roles by designat-ing partners to fulfill those roles instead. There are cases where you cannot achieve that, of course, and

places where the operations con-tinue to be core. For example, we believe we need our own people to build our high-bandwidth research network and connect our leading-edge researchers to high- performance computing resources. Similarly, we need folks who are capable of advancing, at a deep tac-tical level, the user experience that we provide faculty, students, and prospects through our Web portal. These activities can’t be easily acquired from partners, and doing them well confers real competitive advantage to our university.

At the same time, when we look at the maintenance of our network as a whole, we are trying to move our staff away from installing jacks and troubleshooting network faults. Those skills are available from commodity providers better and cheaper. At ASU we think our net-work team should be working strategically — laying out the net-work strategy, understanding the impact of the next innovations, figuring out where to allocate resources, understanding what the competition is doing, and deter-mining how we can use our net-work to achieve the next level and advance the institution.

However, even though we do want to reserve our people for stra-tegic work, at the end of the day we recognize that we need to be

able to execute tactically. If you can’t translate your strategy into operational systems, your strategy is meaningless. We have to have people at the tactical level who can make good on integration decisions and deliver the service.

At ASU this translates to effec-tive vendor management, ensuring that our partners deliver on the ser-vice decisions that we’ve made. As IT continues to industrialize, many IT groups will need to make the transition away from the direct provisioning of services and toward managing a network of companies that provide the institution’s unique blend of services. Groups will dis-tinguish themselves by the degree to which they can achieve a seam-less blend at low cost, ensuring that their institution gets solid value every day from its partners.

Overall IT Costs at ASUASU’s annual expenditures exceed $1 billon per year. Of that billion, the annual central IT budget is around $65 million per year or roughly 6.5 percent of total expen-ditures. If we add in another $30-$40 million per year in distributed IT spending by colleges, schools, and administrative units, then total IT spending at the university runs at about 10 percent of the total budget.

Fundamentally, our strategy is to drive more employees up the value chain toward strategic considerations and use fewer of our own people in tactical roles by designating partners to fulfill those roles instead.

Adrian Sannier

Vice President and University Technology Officer

Arizona State University

Adrian SannierVice President and University Technology Officer , Arizona State University (continued)


The $65 million in central uni-versity technology expense includes not only equipment and services but also personnel costs. The split is roughly half and half between personnel and hardware/services. Over time, we expect this split to tilt toward the hardware/services side as ASU brings on more exter-nal partners to provision services.

As the organization shifts, we find we require fewer, but more highly skilled workers. Although our headcounts are declining, our payroll is not declining as quickly since the average salaries of the people we have retained and attracted are trending upward. This is consistent with the value-chain increase that we are seeing.

Planning for the Next 12 MonthsIn the face of the extreme bud-get pressures that the economic slowdown has brought to institu-tions public and private across the U.S., I think a lot of places will be hunkering down for the next few years, focusing on maintaining what they have and basically just doing their best to hold on.

Certainly ASU is feeling those pressures too, but we nevertheless plan to continue extending the sys-tems we have put in place to sup-port 1:1 mobility. For example, every month we are launching new self-help capabilities through our portal. These services streamline faculty and staff interaction with the institution and allow our fac-ulty and staff to spend more time working with students and less time dealing with the daily “admin-istrivia.” Our portal improvements are making our faculty and stu-dents more effective and efficient by weaving together the sets of ser-vices we provide, making them more understandable, and reducing the complexity of the “online insti-tution.” We are streamlining and making better use of the invest-ments that we have already made in CRM with a 24x7 outsourced help desk and knitting those things together to supply a broader array of services at a higher level of qual-ity than we have had in the past.

Fortunately, ASU finished its ERP project on the student and finance sides prior to the slow-down. In terms of deploying a new financial system, given the present

budget circumstances, we are going to continue to put the chewing gum and baling wire around our one remaining legacy administrative system. This is a time when we will be pushing out upgrades, though we are also still looking at ways to replace a given system with an out-sourced service that will potentially offer us increased reliability and capability at an advantageous oper-ational price.

We are looking at things like unified communications manage-ment, fusing voice, video, chat, IM, and presence to reduce our need for travel and increase overall effi-ciency. I’m confident there are ways we can leverage our relationship with the Google Apps team to broaden participation beyond just the student body to a larger set of staff and faculty members. As a result we might see our expense on the Outlook/Exchange side decline and receive increased capability in the bargain. There are always going to be areas where we will try to implement new things to reduce our ongoing operational costs. As we have been able to find them in software services, we are going to continue trying. ■

Laying out the network strategy

Understanding the impact of

the next innovations

Deciding where to allocate resources

Understanding what the

competition is doing

Determining how to use the network

to achieve the next level and advance the institution

How Does the Network Team Think Strategically at ASU?

John VoellerCKO, CTO, Senior VP , Black & Veatch

© Books24x7, 2009 John Voeller ExecBlueprints 12

Current National and Global Trends Impacting ITCurrently, our primary need is to attain a much stronger and more integrated process for supply-chain management. The second need is to manage foreign contractors and workers, which means getting them involved in mobile technologies to a greater degree. The third is to learn to work within the new international accounting rules as

they become active. And the fourth is to deal with the new reporting demands that are being compiled by the new administration and Congress that will affect everything from taxes to reporting new hires and those who have been laid off.

While this list does not reflect the strategic focus we would like to have right now, it is likely where we will spend our money, given limited budgets. Our current defin-itive weaponry that differentiates us is pretty robust, so we do not have to get aggressive about that area at the present time.

Due to the increasing problem with cyber security and nation-state assaults that are occurring, the IT realm will soon be intro-duced to game-changing events. We are a global business, and realize that the recent announcement of the nation’s new security strate-gy, the numerous failures and

breaches, and the implications of buyouts like Sun and Oracle all fac-tor into a very dynamic landscape in which tactics must be equally adroit. Tactically, we are going to carefully observe these game-changing events and react to them accordingly. However, I think we will need to undergo at least 24 months of serious changes before things become clear again.

Current Tactical and Strategic NeedsBoth our strategic and tactical needs have changed significantly in the past three years. Years ago we spent an amazing percentage of our bud-get to build competitive weaponry that allowed us to not only beat our competitors but to actually change the price points of our industry. The cost to build the average power plant back then was roughly $1,100 per kilowatt. Today we build power plants for $230 per kilowatt, which is nearly a 5-to-1 reduction in costs. We accomplished this by reducing the schedule by 50 percent and issues related to time limits and safety by 55 percent. Today, we focus much more on reacting to issues that we don’t intimately con-trol and making sure that they do not impact our primary business. This makes mobile access and real-time awareness critical to us.

To ensure that new systems address current strategic and tacti-cal needs, we use a combinationof the Software Engineering Insti-tute, the Capability Maturity Model, and ISO-9003 to oversee all changes and additions to our IT environment. We have a process for development that we and our con-tractors use to ensure that certain procedures are always followed and that our user community’s requirements have been addressed by the process architects. These are people who understand the details

The key for me as the CTO is to always know what technology is available, find places where we can get value from it, and make sure we understand that no technology lasts forever.

John Voeller

CKO, CTO, Senior VP

Black & Veatch

John VoellerCKO, CTO, Senior VP

Black & Veatch

“I need to not be a control agent but rather a trusted advisor who ensures that the company is using technology as optimally as possible.”

• Serves as consultant to Office of Science and Technology, Department of Homeland Security

• Recipient, the Ed Forrest Award For Highest Achievement in Engineering Automation for 2000

• Recipient, CIO Premier 100 Award as one of top 100 CIOs in the U.S. for 2000

• B.S., Mechanical Engineering, Georgia Institute of Technology

Mr. Voeller can be e-mailed at [email protected]

John VoellerCKO, CTO, Senior VP , Black & Veatch (continued)


of our business and how our pro-cesses work. When we look at a new system, they are the ones who consider what is being planned and guide the process so that something that looks very good in one context does not actually contaminate another process that we have already optimized.

Our systems are exceptional at addressing our tactical and strate-gic needs. They have ensured that we have lowered our IT budgets in the past 10 years by about 30 percent while still maintaining our workload. Because we have many employees and locations around the world, achieving even reliable maintenance at a common performance level is a great chal-lenge. These processes ensure that we don’t end up consulting several times with different companies on the same issue, build duplicate sys-tems, spend large amounts of money, and in the end lose sight of the original requirements and motivations.

Prioritizing Technology StrategiesIn the past, as CTO, I played a very aggressive role in helping to prioritize technology strategies. I tried not to become too dependent

on technology and certainly tried to keep us away from the bleeding edge. In many cases I tried to hold technology at bay because it carries a certain level of risk: the newer it is the more risk it usually carries. We have used technology conserva-tively and have contained the use of new technologies. That is the primary role I still have today. We now have CTOs in each of our business units and they look out for their needs, which vary depending on the particular business sector and the needs of their client sectors.

The key for me as the CTO is to always know what technology is available, find places where we can get value from it, and make sure we understand that no technology lasts forever. Most importantly, I need

to be fully cognizant of the cost and impacts of using any technologies in order to implement them in an informed way or, in some cases, skip them altogether if they don’t contribute value.

Role of Other Departments in Prioritizing Technology In each of the business units we have identified the most knowledgeable employees who understand our pro-cesses and how they interconnect. In most cases our work is done in accordance with contracts, rules, and laws. All of our employees have to follow certain rules and regula-tions. We therefore have to educate them about technology’s capabilities and enable them to re-evaluate and re-engineer their processes with the

Expert Advice

I advise the board on technology issues. For example, I met with my CEO in early 2009 about whether his use or nonuse of certain technologies alienated some of our younger employees. I confirmed to him his own suspicion that some of the younger generation did not know he existed because he used our Web site and e-mail as his primary communication channels, which are not the younger gener-ation’s idea of social digital interplay.

Within 13 days he was on MySpace, he understood Facebook, and his blog was up and running. I could have tried to force that issue years ago, but he was able to realize himself what might be happening and asked the right questions. The minute that happened, we were able to advise him and he is now enjoying the technology and utilizing it very well.

Different companies are not consulted on

the same issue

Duplicate systems are not built

Large amounts of money are not spent

Original requirements and motivations are not lost in a too-complex development process

Thinking Both Strategically and Tactically Ensures That. . .

John VoellerCKO, CTO, Senior VP , Black & Veatch (continued)


guidance of their process architect. Then they can provide information to the IT group on which functions could use improvement and let IT explore how to enable those func-tions. This is not a control issue but one of giving the users a sense of ownership in new technology adop-tion rather than turning them into victims of an IT assault on their work processes.

Determining which IT staff will work in strategic versus tactical areas tends to work itself out. We have a very aggressive HR system that continuously examines all employees’ performance more fre-quently than the usual year-end evaluation. And we maintain very direct communications with the HR department. Usually we dis-cover that employees who are going to work on the tactical systems are technically strong but they don’t

syndicate or collaborate as well. In the tactical system setting such traits are not so serious, but employ-ees who are the best strategic play-ers are the people who quite naturally gravitate to building teams, understanding the core issues, and listening to others. Whether to place staff in strategic versus tactical areas, therefore, has more to do with determining their people skills than their IT skills.

IT Systems UpgradesTo support strategic and tactical needs, our materials management and sustainability tracking systems are the main areas that need upgrades. The second priority is to determine how to use our HR sys-tems more aggressively because the demand for people in our business is enormous. Two years ago we

hired 2,300 people in one year, and at the rate that we are losing our baby boomers to retirement, that figure may increase.

We have been an intense user of IT for many years, and this has required an enormous amount of knowledge. We need to mine our past knowledge and communicate it to our younger generation so that they can pick up the ball as our baby boomers leave. That is one of the roles of the chief knowledge officer. We have to be skillful, however, in figuring out how to transport, package, and present knowledge so that the younger peo-ple can be promoted and take on more responsibility and have the same level of knowledge as their predecessors did, using the tools that leverage their exceptional skill with digital technology. ■

Maribel Picó PiereschiCIO , Puerto Rico Electric Power Authority

© Books24x7, 2009 Maribel Picó Piereschi ExecBlueprints 15

Defining Strategy“Strategy” is a set of clear, concise statements that clarify the enter-prise strategy intent. A strategy articulates a vision or objectives, and bounds the options for attain-ing it. A “principle” is a rule of conduct, or method for acting. A principle represents a clear message from executive leaders on the

desired decision-making biases. It provides guidance and general direction in support of strategic intent.

IT managers must become more strategic in their approach as they learn to work with the highest levels in the company on the formulation and execution of corporate busi-ness and strategic plans. Through the entire IT lifecycle and in the devel-opment of business and strategic plans, IT and business man agers must remain closely aligned. Busi-ness managers must also be visi-ble across the entire IT investment portfolio, assuring IT invest-ments are aligned with the business and strategic objectives.

IT StrategyIT strategy must have both demand and supply sides. The demand side designates IT’s role in helping the business win. The supply side sets

a direction for the application of IT assets and capabilities that is con-sistent with the demand side. The demand side is composed of busi-ness context, IT contributions to business success, IT governance, IT principles, and funding. The supply side components are IT architec-ture, risk management, people, sourcing, IT services and process, and IT assets.

Tactical StrategyTactical needs necessarily focus on how to manage the strategic plan in an effective and efficient manner. IT achieves this by providing greater insight into key IT strategies and initiatives as well as priority IT investments across the organiza-tion. Tactical strategies spell out the current state and planned IT initia-tives and investments in a detailed manner. They serve as implementa-tion blueprints for departmental IT strategies, directions, priorities, and approaches. Since the tactical plan provides a greater level of detail and specificity for key IT strate-gies and initiatives, it will change more frequently than the strategic plan. It is a living document that will need to be updated more fre-quently and significantly than the strategic plan, evolving and improv-ing over time with additional busi-ness and IT department input and collaboration.

Balancing Strategy and TechnologyIT needs to maintain a role in the development of strategy. This will help to clarify the role of IT and help the IT team to continu-ously monitor and assess the value of the discovery, project, and asset portfolios. A critical step in align-ing strategic and governance initia-tives is the creation of business context. This includes the bus-iness strategy as well as external trends affecting the enterprise. It is always a good practice to:

IT managers must become more strategic in their approach as they learn to work with the highest levels in the company on the formulation and execution of corporate business and strategic plans.

Maribel Picó Piereschi

CIO

Puerto Rico Electric Power Authority

Maribel Picó PiereschiCIO

Puerto Rico Electric Power Authority

“A CIO needs to provide a balance between managing the status of IT investments and promoting the value created by the IT organization.”

• With utility since 1990; CIO since 2001

• Oracle Corporation’s 2005 CIO of the Year (Latin America)

• B.S., Industrial Engineering, University of Puerto Rico

• M.B.A. (Specialization in Management), University of Phoenix, Puerto Rico Campus

Ms. Piereschi can be e-mailed at [email protected]

Maribel Picó PiereschiCIO , Puerto Rico Electric Power Authority (continued)


• Create a set of principles that will ensure that implementa-tion decisions align with strat-egy, reflect future visions, and represent a high-level business model that illustrates how the components of the enterprise relate with one another as well as with external parties that make up the business eco-system.

• Provide strategic drivers for initiatives such as business pro-cess improvements, a business improvement competency cen-ter, and governance activities.

• Study the implication of busi-ness strategies and environ-mental factors (e.g., customer, regulatory, and technology pressure) on the process the business performs, the people who perform the process, the information the business uses, and the technologies the busi-ness employs.

The business strategy should answer the following questions. What does the company want to do? Who is the target? What is the geographic scope of the strat-egy? What is the timeframe? How will goals be accomplished? IT should then focus on aligning the business and strategic objectives to create collaborative solutions.

Moreover, you need to consider the value/cost trade-offs of current and future technologies, specifically their capability to deliver current and future levels of services. This includes the cost-versus-benefits value of current infrastructure.

Role of CIO/CTOA CIO is expected to run IT like a business by maintaining specialized skills and expertise. He or she must be able to serve as a key strategist, offering ideas and concepts that contribute to the formation of cor-porate strategies, and that consider how investment can be balanced among various products and ser-vices in alignment with the business units. Managing and measuring the performance and alignment of the portfolio fund, serving in a key role on the executive steering com-mittee, and translating and demon-strating complex ideas as solutions, are all meaningful, understandable, and necessary qualities with a dem-onstrated value for a CIO.

Corporate IT OfficePREPA has a decentralized IT orga-nization with a central corporate office that is responsible for the development and implementation of the IT strategy, corporate poli-cies and procedures, and the IT

infrastructure. Each IT department identifies opportunities and solu-tions for their needs and either works alone or with another depart-ment to develop an integrated solution.

The corporate IT oversees the operation of all business-critical applications, 24x7, and provides support for critical applications, such as the call center, collabora-tion application, data integration, and the corporate intranet. They are also in charge of development and implementation of corporate policies and procedures to ensure that optimal IT resources are uti-lized, allocated, and delivered. Interaction with the business unit is critical for the implementation of IT solutions. As the economy suf-fers a downturn, it is more impor-tant than ever for a company to focus on cost-reduction, perfor-mance, and better resource alloca-tion. The corporate IT office is the custodian of the overall corporate value standard.

IT CouncilPREPA created the IT council, which participates in the formula-tion and implementation of IT strategy and tactical plans. Com-posed of representatives from each business unit, the primary objective of the IT council is to develop and recommend the strategic plan, eval-uate IT investment, and recom-mend IT priorities based on the business strategy to the steering committee. The council is also able to allocate resources to ensure compliance with IT strategic plans and to recommend departmental solutions. They participate in the formulation of corporate policies

Expert Advice

IT Department Council The primary objective of the IT department council is to evaluate proposed IT investments in the context of predetermined acceptance criteria and methodology in accordance with business strategy. It evaluates new IT initiatives to ensure that the proposed service or product is in compliance with corporate standards, methodologies, and policies. It determines if the proposed project is feasible and if the required resources are available. The IT department council recommends priorities based on business and IT strategic plans, and presents recommendations to the steering committee for proposed projects, describing the funding and resources required.

Maribel Picó PiereschiCIO , Puerto Rico Electric Power Authority (continued)


and procedures related to technol-ogy across the organization.

Steering CommitteeThe steering committee, a higher governing body than the corporate IT office, works directly with the CIO. Its main objective is to provide a forum where the enterprise view

can be discussed and evaluated, resolve questions of enterprise importance, empower the tactical execution of policies and decisions through governance structures, and reconcile conflicts. It analyzes criti-cal IT issues such as IT investments and their alignment with the enter-prise’s strategy plan, risk, and overall IT funding level, infrastruc-

ture investments, and competitive issues that IT can address. The steering committee takes responsi-bility for energizing an enterprise IT strategy and delegating author-ity to execute that strategy. This committee acts as final arbiter when it comes to allocating resources to a project. ■

© Books24x7, 2009 Ideas to Build Upon & Action Points ExecBlueprints 18

Ideas to Build Upon & Action Points I. What Are Common IT Challenges?Due to ever-increasing technical complexity, more stringent regulatory environments, and problems associated with cyber security, the IT industry now faces “game-changing events” that require unprecedented levels of strategic plan-ning with the business to solve. Specific exam-ples of current IT issues and concerns include:

• Building truly collaborative relationships between the IT organization and business partners

• Working with conflicting technologies

• Maintaining data and infrastructure security in remote, mobile, and partner locations

• Attaining common performance levels across global sites

• Achieving effective teamwork across global IT teams

• Balancing organizational requirements to simultaneously cut costs and initiate inno-vative projects

• Addressing new government-imposed reporting requirements and international accounting rules

• Developing leadership and innovation capabilities among young managers, so that they will capably succeed retiring baby boomers

II. The Bottom LineTechnology can add demonstrable value to the organization if it’s developed as part of a strate-gic planning process that considers the business’ needs, value/cost tradeoffs, and future uses — and then effectively implemented using a careful planning process. The strategic and tactical benefits that your IT solutions bring to the orga-nization can be tangibly measured by determining:

• What costs have they saved, in systems, materials, labor, outsourced services, or overhead?

• What economies of scale have been achieved?

• How have they increased the velocity and efficiency with which the organization does business?

• How have they specifically enhanced the organization’s revenue?

• How have they improved services to the company’s customers?

• How have they helped drive common sys-tems across the enterprise?

• How have they enabled the business to adapt to change (whether brought about by internal or external factors)?

• How do their costs compare with those borne by other companies in your industry?

III. Must-Have Roles for the CTO/CIO in Planning Strategic and Tactical InitiativesAt many companies, the IT leader is now a C-level executive who is expected to actively par-ticipate in company-level strategic planning initiatives. At the same time, they are also ulti-mately responsible for keeping the lights on. Today’s CTO/CIO must, therefore, serve as the department’s key strategist and pragmatist by:

• Staying apprised of what technology is available for the organization’s industry, as well as its costs and impacts

• Honestly assessing their organization’s technology needs against its financial posi-tion and risk tolerance — and exercising appropriate levels of restraint in introduc-ing bleeding-edge solutions

• Consulting with the board of directors, companywide advisory boards, and steer-ing committees on technology issues and priorities

• Keeping business unit leaders informed on how technology can positively impact their operations and relationships with custom-ers and stakeholders

• Meeting with appropriate business-unit leaders to design and develop specific IT projects

• Managing and measuring the performance of IT systems and staff

IV. The Golden Rules for Managing Both Strategic and Tactical ProjectsIdeas for new initiatives and projects come from a variety of sources: customers, internal process reviews, compliance and security requirements, and technology trends. At the same time, you still must remain operational 24x7 — and within budget. How can you balance the competing pri-orities posed by planning for the future and attending to the needs of today? Effective man-agement approaches discussed in this report include:

• Training your IT staff to be flexible and willing to adapt to an ever-shifting mix of roles and responsibilities in both strategic and tactical areas

• Encouraging employees to take the initia-tive on strategic and tactical projects that can best utilize their technical expertise, people skills, and experience

• When possible, reserving your IT staff for projects that provide competitive advantage and differentiation, and desig-nating partners to fill more basic roles

• Engaging staff with the following strategic questions:

• What’s the network strategy, and how will the next innovations impact it?

• How should resources be allocated?

• What is the competition doing?

• How can you most effectively leverage your network to advance your organization?

V. Essential Take-AwaysIn order to effectively balance your organiza-tion’s strategic and tactical IT resources, you must first ensure that you, together with com-pany leaders, have articulated a clear vision and objectives with respect to its technology direc-tion that can provide the framework for effec-tive decision making. In addition, you must establish clear policies and procedures for exe-cution of all IT strategies in order to ensure that you don’t duplicate efforts and/or lose sight of their original intent. Best practices for achieving both strategic and tactical priorities are:

• Develop a tactical plan that can serve as an implementation blueprint for departmental IT strategies, directions, priorities, and approaches — and be prepared to update it frequently to accommodate new strategic initiatives and priorities.

• Identify innovations that are emerging throughout the company, and evaluate their suitability for companywide implementation.

• Engage “process architects” to plan proj-ects with non-technical users to ensure that their needs are met in ways that won’t con-taminate existing systems.

• Collaborate with company leaders to ensure that technology projects remain tightly aligned with the organization’s overarching mission, and undergo required review processes.

• Limit internal development to solutions that can provide a unique or differentiating advantage to your organization.

• Avoid undue disruptions by minimizing major systems changes.

• Contract with vendors to perform non- differentiating services, such as hosting your ERP or managing your network, and ensure that they deliver.

• Evaluate projects at each stage (innovation, R&D, and full deployment) to assess whether further investment is warranted. ■

© Books24x7, 2009 Ideas to Build Upon & Action Points ExecBlueprints 19

Ideas to Build Upon & Action Points (continued)

ExecBlueprints is a subscription-based offering from Books24x7, a SkillSoft Company. For more information on subscribing, please visit www.books24x7.com.

10 KEY QUESTIONS AND DISCUSSION POINTS

1 With regard to information technology, what are your company’s current strategic and tactical needs? How are they similar or different? How do they compare to the needs of other companies in your industry?

2 What types of company systems does your department build and maintain? How do these differ by department and/or product and service line? Which resources serve strategic purposes? Tactical purposes? How has this mix between resources devoted to tactical and strategic purposes changed in the past three years?

3 When developing and implementing new systems, how do you ensure that they address current strategic and/or tactical needs? In what ways is the present configuration serving your company’s overall strategic and tactical needs?

4 What are your best practices for balancing your company’s strategic and tactical technology resources? How do you involve other C-level executives in this process?

5 How do you determine which IT staff will work primarily in strategic areas? Tactical areas? What orientation and education does your IT staff receive on your company’s overall business and business strategy?

6 Which IT systems at your company need to be upgraded to more effectively support current strategic and tactical needs? How do you expect these upgraded functions will benefit the company as a whole?

7 What are the top five challenges IT presently faces in its endeavor to balance your company’s strategic and tactical technology needs? In what ways do they differ by location and department? In what ways are they the same throughout your organization?

8 In the next 12 months, do you plan to institute any new policies or procedures? Which resource areas will they affect: those devoted to strategic needs, tactical needs, or both?

9 What is the ROI for the IT function at your company? What are the potential costs and consequences if a system should critically fail or if slowdowns should occur? How does the ROI compare for working with strategic versus tactical resources?

10 How is the overall effectiveness of IT systems and procedures benchmarked at your company? Against the track record of previous systems and procedures? Against the successful execution of business strategies that involve IT solutions? Against the successful execution of functional needs that involve IT solutions?

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Balancing Strategic and Tactical Resources for Efficient IT Results

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