There are still companies where the IT department is regarded as a back office function - a necessary evil, part of the cost of doing business. But increasingly, IT directors and chief information officers are finding they offer a unique insight, which puts them and their teams at the forefront of business development.
Tania Howarth, CIO of Coca-Cola Europe, is one such CIO. Howarth has expanded her role outside the confines of IT and believes IT should be an integral part of each area of business operation.
At Coca-Cola, Howarth has been spearheading a number of projects focusing on improving operational effectiveness. These have not been restricted to IT operations. "As a CIO you cannot just hide in the technology," said Howarth.
In her experience, organisations are often not equipped to handle change. Business change encompasses process and behavioural change, and Howarth believes the CIO is uniquely placed to orchestrate these changes. "The CIO can see the connection between the different business functions," she said.
The most successful heads of IT are good communicators, are able to display an empathy with the business and are good at managing people. "To be successful at the top of IT you have to be a successful leader and understand the complexity of management."
Howarth has distilled her vision of what it takes to be an effective strategic CIO into seven steps (see box). At the heart of these is the premise that an IT head must have an instinct for business. Questions IT directors should ask themselves include, "Do you really understand how the business works?" and "Can you empathise with the challenges the business faces?"
Howarth regards business strategy and its execution as dynamic, continuous and holistic. For her, the real value an IT director can offer is to connect up the value chain across the business. Stakeholder management is as important as the skills more often associated with IT directors' core skills of project management and risk management.
According to Howarth, the role of the CIO is to deliver strategic change. In her words, the CIO needs to "create an honest and compelling value chain of delivery".
She urges CIOs to remove any barriers that hinder progress, deliver the benefits in small steps and ensure that there is a governance process with clear lines of accountability for the business change project. Last but not least, she says, "Delivering change is the art of the feasible."
What is important for Howarth is that the project should not be a one-shot. "Change is constant," she said. She believes it is critical for the CIO to move from an undue emphasis on transformational change to continuous improvement. Such continuous improvement needs to be embedded into normal working operations.
"It is important to take the team with you," Howarth said. This means the team should understand its greater role within the business.
"Even for very technical roles, business integration has to happen at all levels. If you work within IT at Coca-Cola you work for a soft drinks company, not an IT company."
She acknowledges an IT department needs strong technology people, programmers and network designers, "but everyone in your team must understand the business". It helps when the IT staff work more closely with the business. At Coca-Cola, Howarth's team has a lot of touch points with senior business heads. "Even junior managers have client responsibility."
Some of her team have worked with the sales people on new product launches, stacked shelves or put up point of sale kiosks. And the more technical staff are offered management training and business awareness.
In her experience this day-to-day training is easier to achieve than a more formal approach such as placing staff on secondment. "It is difficult to do secondments in a meaningful way and it tends to happen around projects," she said.
With these measures in place, Howarth recommends IT directors measure business key performance indicators. She suggests looking for incremental improvement, rather than measuring the results when the change project is completed.
Seven steps to being a strategic change leader
● Think, feel and act as a strategic business leader
● Connect the dots to know the business instinctively
● Operate within the organization
● Take the IT team along with you
● Deliver change according to a clear destination and through a staged process
● Continuous improvement and exploitation
● Measure until it hurts
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This was first published in March 2007