The Role of the CIOThe Role of the CIO

Charles Assaf

Francisco Gonzalez-Meza

Sean Athans

Diego Siri

AgendaAgenda

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 BackgroundHistorical BackgroundTraditional Brick and Mortar

Growth of E-Commerce

Internet Bubble

Cost Cutting and Becoming Lean

‘‘The Genus CIO is a Mutating SpeciesThe Genus CIO is a Mutating Species’’

External and Enterprise DriversExternal and Enterprise DriversLine of businessLine of business

Complex Business ModelsComplex Business ModelsMonolithic businessMonolithic business

Business MetricsBusiness MetricsIT MetricsIT Metrics

Multiple ResponsibilitiesMultiple ResponsibilitiesSingle CIO RoleSingle CIO Role

Role of the CIORole 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 CIORole of the CIO

Lead – Bridge business and technology

Anticipate – Sense key trends

Strategize – Shape demand and synchronize

Organize – Orchestrate for lighter IS

Deliver – Provide cost-effective and timely services

Measure – Know where you stand and why

LEADLEAD

Measure

Strategize

Anticipate

Deliver

Organize

Six Imperatives Define the Role Six Imperatives Define the Role of the CIOof the CIO

SkillsSkills RequiredRequired

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 ErasThe Effect of Technology Eras

ComplexityComplexity

Business Business ExploitationExploitation

of ITof IT

WebWeb--basedbased

DistributedDistributed

Mainframe EraMainframe Era

Strategic ContributionStrategic Contribution

Time Time

Management Priorities

E-business process

Embracing the customer

Exploiting ERP, CRM

Sourcing management

M&A management

Managing IT costs

Management vs. TechnologyManagement vs. Technology

Technology Priorities

E-business capability

Business-adaptive IT designs, CRM

Supply chain management

Legacy migration

Strengthen infrastructure

Support for intangibles

Criteria for a Successful CIOCriteria for a Successful CIO

Assess the performance of the CIO

•General•Sample performance criteria

TacticalStrategy •Industry/project specific•Performance Process

Criteria for a Successful CIOCriteria for a Successful CIO

♦ 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 ?

Strategy

Sample 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

within budget ?

♦ Etc…

Performance ProcessPerformance Process

2. Periodic Assessmentof Performance

Meet

Criteria?

1. Set PerformanceCriteria

Tactical

Sample 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

within budget ?

♦ Etc…

Performance ProcessPerformance Process

2. Periodic Assessmentof Performance

Meet

Criteria?

1. Set PerformanceCriteria

Tactical

Repeat on aper phase basis

Distinctive FeaturesDistinctive 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 CIOThe E Priorities of the CIO

Energizing enterprise strategy and initiatives

Enabling new business initiatives

Executing cost-effective solutions

Exploiting technologies, sourcing opportunities

and benefits

The E Priorities of the CIOThe E Priorities of the CIO

EnergizingEnergizing

EnablingEnabling

ExecutingExecuting

ExploitingExploiting

The Four E’sThe Four E’s

Claude Claude CargouCargou –– EVP of IT AXA GroupEVP 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'scompanies; 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 Jose Luis Luna –– WW CIO CEMEXWW CIO CEMEX

Joined CEMEX in 1987 as Head of technology developmentFew industries more basic or old economy than cementPre-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:

CemexnetDynamic Synchronization of Operationse-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 Karl WachsWachs –– WW CIO CelaneseWW 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 comingCentralized management

Today – Driver of the biggest transformation within the company

OneSAP: Consolidate seven SAP entities into oneBudget: $60 million dollarsROI estimated: 50%

Executing cost-effective solutions

Dawn Dawn LeporeLepore –– CIO Charles SchwabCIO 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 playersResponse: Led web project to serve 4.3M usersResult: Hands-down leader in on-line trading

Challenges:

Technology? No – Easy partCreating momentumAvoiding Outsourcing

Exploiting technologies, sourcing opportunities and benefits

Typical barriers for a successful CIOTypical barriers for a successful CIO

Hierarchical structure of the companyCFO: Budget

CAO: Accountability

Available resources fluctuation

Too many IT genius within the senior management team

Short term planning

Awareness of CIO possibilities

RecommendationsRecommendations

BATMAN DON’T FLYBATMAN SERVES GOTHAM CITY

BATMOVIL AND GADGETS ARE NOT CHEAPHE BUYS ONLY WHAT HE NEEDS

THE RED PHONE IS FOR CONTACTING THE COMMISIONER, NOT HIS SECRETARY

Questions ?Questions ?

WWW.CIO.COM

♦ Oct. 1, 2002 Issue of CIO Magazine | "Who Made It Happen"

♦ Jan. 15, 2003 Issue of CIO Magazine | "ERP Consolidation"

♦ Oct. 1, 2002 Issue of CIO Magazine | "Who Made It Happen”

WWW.GARTNER.COM

♦ September 2000 E-World CIOs | Jason Beasley-Hahn

♦ 6—9 November ITxpo2000 | Charles Chang

The evolving role of the CIO| Jeanne W. Ross and David F. Feeny

ReferencesReferences