Chief executive officers need to invest in information technology and rethink how to deploy IT within their companies in order to stay ahead of their competitiors, according to a high profile panel of IT executives at the Forbes CEO forum.
According to Andy Green, chief executive officer for the Global Services division of BT, the goal of a chief executive should be to set up an IT system that will provide a company with real-time access to a single view of the customer.
"This is a leadership issue. I have been speaking to chief executives and chief information officers from around the world and I am concerned about how fast I have seen those leaders move away from a customer-centric view of the world. This is not a technological problem, it is a business leadership issue," Green said.
Patrick de Smedt, chairman of Microsoft EMEA (Europe, Middle East & Africa), and Amnon Landan, chief executive of the software supplier Mercury Interactive, called on chief executives to invest in IT, but to do so wisely and with an eye firmly on a broad plan that drives to create a culture of innovation.
"IT is still at a very embryonic stage. But how companies are deploying IT is still very amateurish," Landan said. "Top executives in companies today understand the technology, but they don't know how to apply it in an efficient manner. Frankly, the existing picture is pretty bleak."
Standardisation is important, the panel stressed, as is the need to drive the automation of business processes. Additionally, the question from the chief executive should not be "what is the new technology?" but rather "how can we effectively integrate the technology we already have?" the IT executives said.
Green had three tips for chief excutives. A chief executive must first spend time on IT, specifically with IT suppliers and with the IT staff within the corporation, he said.
Secondly, companies should not run "IT projects" but strive to run "change" projects.
The third tip was that the one exception to that rule is to get companies to invest in a flexible IP (Internet Protocol) infrastructure.
"The good news is that I don't think this has to cost you a lot of money, but you must enable your company to be flexible in the way you move data around your company," Green said.
Microsoft's de Smedt pointed to his own company as an example of how executives should be thinking about IT.
"You have got to simplify your IT environment. For example, we have centralised all of our servers on Windows and have rid ourselves of mainframes. We also use no customised software, it is all packaged software - for procurement, we use SAP - and we are using relatively simple software to develop business applications that allows us to get much more value out of the information that we already have."
Where chief executives often fail, according to Mercury Interactive's Landan is in not having a notion of processes or of quality control.
"The internal dynamics of IT operations is too often running in a vacuum, from a technology point of view, which creates a misalignment. The IT guy is looking at what's happening on the network while not having an end-to-end business viewpoint. The chief executive has to make sure that everything works for the end-user."
Green said retail firms such as Wal-Mart Stores and Tesco, search engine company Google, online banking services company Egg and economy airline Ryanair were examples of corporations that have successfully deployed technology to remake their business models around the self-service of customers.
"There has been no moment when IT has been more important. You must use technology to create new added value," Green said. He added that Europe is clearly lagging behind the US when it comes to understanding and applying new concepts.
Companies need a new breed of chief executive, people who can bridge the gap between a company's labs and scientists and its business people, something that is beginning to happen in the US but still lacking in Europe, added Laden.
Laura Rohde writes for IDG News Service