A CIO's guide to SMAC strategy and governance
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Despite facing tough macroeconomic conditions, the IT department at global recruitment firm SThree has been busy – and the intention is to build on that foundation in 2014 with an emphasis on data analytics, cloud and mobile tools.
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The company recently reported a 3.4% fall in gross profits compared to the previous year at £192.8m, but progress has been made against strategic priorities - international expansion being one – and the technology team is working to support those key business objectives.
“SThree has a vision, which is to be the most profitable recruitment company and IT plays a big part in this. Simplistically, we need to ensure the services we provide are as efficient and cost effective as possible in order to be profitable,” says the company’s chief information officer (CIO), Lance Fisher.
“Profit is revenue minus cost. Too often I see many of my peers concentrate on just the cost side - it’s about both. So you need to think of what innovations can you introduce to achieve more revenue and to be more efficient.”
In post since 2010, Fisher says he did not continue the work of his predecessor. Instead, he has built his own strategy, specifically linked to the overall business plans.
“My approach has been to connect IT to the business and work outside in, figure out what is our intellectual property (IP) and invest in that – and we just buy in the commodity items. My mantras are: think global; scalability and reliability; buy, don’t build; and develop an innovation culture,” he says.
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Beyond device management
Fisher’s IT strategy is around what he calls SMAC – social, mobile, analytics and cloud. His team is building on the successes of 2013, which included an implementation of Good Technology mobile software and the roll-out of Hornbill’s Supportworks to automatically provision new IT users.
SThree used Supportworks for the roll-out of Good software to staff-owned mobile devices, which, done manually, would have taken months and reduced take-up. Both implementations have been completed successfully.
Projects in 2014 are “quite a few", all centred on the four technology areas set out in the SMAC strategy, mobile being one of the most important workstreams.
“The IT revolution is in progress. It is all about innovating in all of these areas. One of the main forces of SMAC is mobile - we have recently been rolling out and working with Good Technology, which is a key partner in our mobile strategy and how we enabled our recruitment workforce to have email and documents anywhere they go,” says Fisher.
But the CIO stresses the point that his mobility strategy is not just about mobile device management (MDM).
“I have been fairly vocal with my peers that it’s not just about managing the devices, it’s about the apps that run on the device - your data and apps are all you should be concerned about,” says Fisher.
“But if MDM stands for master data management, then as a CIO you need a clear data strategy. It’s all about data: the right data gives you insight and, based on that insight, you can action changes that can change your business.”
The company has also worked towards building a cloud-computing foundation to support the overall strategy. In the last couple of years, 68 databases were consolidated on to a single Oracle Exadata machine, hosted by Telecity, with a Citrix front-end to user devices. SThree also has its own private cloud, which is managed by Oracle services.
Another core pillar of Fisher’s IT strategy for 2014 is analytics and data mining. SThree uses the technology to find and match candidates and the CIO stresses that data and the insights the recruitment firm obtains from it are a key differentiator.
“You may be surprised to find that we are the only global recruitment consultant that has the ability to have a global candidate database – that gives us a competitive advantage. And we are continually developing new ways to interpret our data to support the work of our consultants,” says Fisher.
“We use Oracle for our core database technology and are an SAP user in our back office. We have developed and have patents pending on some sophisticated search algorithms that we use to mine the right candidate and use Business Objects to sit on top of all of our data,” he adds.
“I am particularly hopeful of achieving European patents this year on some of the search algorithms we use."
Will Fisher be looking for more third-party expertise to help out as his strategy evolves?
“We work with the big guys such as Oracle, SAP and Microsoft, as well as niche recruitment suppliers. We blend that to our own IP, which we have developed,” says Fisher.
Some 60% of my staff are doing day-to-day activities, while 40% are growing the business
Lance Fisher, CIO, SThree
“We do targeted RFPs [requests for proposal]. I am working with some key solutions at the moment but in my role, it’s key to have already identified the players and approached them, so even doing the RFP is quite collaborative.”
Fisher says that the cost of IT is about 2.7% of company revenue. “Whereas my Opex [operating expenditure] is tight, the project budget is more difficult to explain as it crosses budget years and has different depreciation,” he says.
“An interesting angle would be to look at people. Some 60% of my staff are doing day-to-day activities, while 40% are growing the business.”
When budgeting for new projects underpinning key strategies, such as SMAC, Fisher says things like social collaboration tools are considered as an operating expense, whereas large projects are classed as capital expenditure (Capex). But the split between the two will vary.
“The trick is to run my Capex plus Opex total budget at the same figure for the next three years. We are achieving and would expect traditionally to mix these two in a different manner. For instance, if you moved from hosting your traditional email yourself to a cloud provider you are transcontinental between the two [models],” says Fisher.
“To achieve efficiency, you have to mix and match these models - you have the total IT spend as percentage of revenue, instead of increasing total IT spend for [one strategy such as] SMAC.”
Having set out his business-oriented, four-pillar strategy based on technology must-haves, Fisher says that his biggest challenge is coping with the pace of change in the IT sector: “Keeping abreast of technology and how to apply it".
But Fisher is confident that the rest of 2014 will be even more positive than last year.
“I expect more awards, more stuff delivered, more innovation achieved and that we will be well on our way to being the most profitable recruitment company,” he says.