René Carayol is outspoken about most things. Whether facilitating changes at board level for blue chip enterprises or just relaxing at his home, the author of Corporate Voodoo is sure to challenge your views on just about everything. What is the biggest challenge facing today's IT directors?
The same as for the past 20 years: the IT director should be on the board, but I think that most would prefer not to be. They joined IT because they didn't want to work with people. Nor do they want the extra pressure of being seen as a commercial entity. I'm sick of hearing about the skills crisis in the IT industry. The big crisis is that there are no role models or personalities in the industry. Bill Gates is hardly a role model. Sure, he's a very rich man, but is he charismatic? Does he drive people to technology? People are going back into accountancy. That's hurtful, really hurtful!
How does an IT director galvanise their team to generate more innovation?
Simple. The head of IT is a leadership role, not a management one. The essential ingredient is vision. They also need the following:
- An understanding of the current situation and an inspirational view of the desired situation
- The ability to communicate succinctly and inspirationally
- The ability to spot talent
- The ability to align constituencies
- Courage - making and taking incisive and decisive decisions
Why do you claim that the Internet has had a negative effect on business?
The fundamentals of business are always the same: is there a sustainable difference between price and cost? If there isn't, you ain't got a business. We forgot that in the fog and excitement of the Internet era. The Internet made a huge mistake that it still hasn't recovered from: it created communities of consumers who got used to buying goods for less than they cost to make. In this respect the Internet era has simply damaged business.
What about e-commerce?
E-business needs to move away from selling products as cheaply as possible. Napster is a prime example, eroding value to the extent that it nearly destroyed the music industry - its business model was Destroyabusiness.com! It's cool, it's sexy, it's funky, it's hippy, but it doesn't make money. In three and a bit years, Tesco has built up a £270m business. 70% of all European online food purchases are made through Tesco.net and it still has to make a profit. Why? Because its start-up costs were so big. If Tesco is struggling to make profit, what gives anyone else the right to expect anything different?
So why is everyone doing it?
Because e-business is here and it's here to stay. What's more, it's exciting. But there are four stages of development:
- Bring all aspects of e-business into your department
- Convert your whole business to an e-business
- Manage your supply chain efficiently
- Generate revenue
- E-commerce is not e-business. It's a transaction-led component of
So are the chips stacked against new business models and innovation?
This is the most exciting time to be in business. Every business has an agenda for change. Why? Depressed share costs. Everyone is trying to do something different that is going to generate a bit of sizzle on a rather bland steak. That's an innovation agenda.
Are you advocating temporary monopolies?
Every organisation and individual at some time in their life has a temporary monopoly. The trick is to understand your temporary monopoly and plan what to do when it ends. Tiger Woods has had one for four years!
How did you get into change facilitation?
I had 20 years of experience in the technology industry, but for one of those years I stepped out of it to work in Marks & Spencer's buying department as a merchandiser. It's a completely commercialised world, focused on just one thing: making money. Working with technologists alone, I was always implementing someone else's decisions. With merchandising there was no blueprint. We developed our own vision. After a year of that, I couldn't go back to IT to implement other people's decisions.
You spent time at Pepsi as well as Marks & Spencer. How did they differ?
I was at M&S during the early 1990s when it was like a business finishing school; Pepsi was like vision school. M&S was about continuing what it had always done; Pepsi was all about where it wanted to go and how it was going to get there. Brits ask you what you've done in the past while Americans ask you what you can do for them in the future.
What do you actually do?
Nothing [ laughs]. I avoid a traditional job and concentrate on the things I'm good at.
I have vision, I communicate well and I can convince people they can do things they never thought they could.
What do the firms you advise get?
The courage to implement their chosen strategies and the speed to effect change
What do you really love in your work?
Convincing organisations with a policy of internal promotion that their own gene pool is a little incestuous and stagnant. I enjoy getting my clients to appoint an outsider at a senior level who they know will challenge the arse out of them - someone who will say the things they don't want to hear!
Can you name any clients who have done this?
Transco, HP and Computacenter. There isn't an organisation I've worked with that hasn't changed its recruitment policies.
Rene Carayol: the facts
Born? The Gambia, 1958
Job? A change facilitator
What's he done? Took IPC into online publishing
What's he say? E-business has made a huge mistake in creating communities of customers used to buying at less than cost price