HCL third customer convention: business agility

How to keep flexible and agile in the midst of disruptive business change is the key theme among more than 350 CIOs at HCL's third customer convention in New Delhi this week.

How to keep flexible and agile in the midst of disruptive business change is the key theme among more than 350 CIOs at HCL's third customer convention in New Delhi this week.

Delegates said they face growing technological and market complexity and the need to respond quicker and better, which increasingly depends on their IT capability.

Tony McCarthy, Deutsche Bank's global head of IT for its investment banking division, said the bank was facing huge increases in the volume and value of transactions, with a growing number of customers. In addition events such as sudden collapses in the stock markets created peaks of activity that made it very difficult to plan ahead. The bank announced a major outsourcing deal today with HCL.

"When the Chinese market lost 8% in a day, the Dow was not quoted for 16 minutes, and it took weeks to clear up the backlog," he said. "Such events add complexity. This is making us re-evaluate our technology and skills with respect to location, skills and position in the value chain."

James Anderson, group CIO of UK-based music group EMI, said the shift to digital meant the music companies no longer control distribution of content. They also face dealing with millions of customers who now download songs formerly they dealt with a few hundred retailers or media outlets.

Anderson said "Artists and customers are now in charge. They say how and when they will receive the product, and now technology such as YouTube is blurring the difference between artists and consumers."

Peter Bender-Samuel, CEO of outsourcing consultancy Everest, said there is a growing appreciation that a firm's "IT ecosystem" now critically affects its ability to deliver products and services to the market.

"(IT) standards are becoming crucial to getting control over transaction volumes, while you need to provide value through differentiation," he said.

That appears to be a tricky balance. Randall Carrier, executive vice-president at FirstHorizon, a financial services firm, said most present efforts to balance this are still based on "silos" of knowledge.

Wim Elfrink, chief globalisation officer of network equipment supplier Cisco, said this was to Cisco's advantage. "Companies have to move from the command and control model of US business to a more collaborative, teamworking model," he said.

Elfrink has just moved to Bangalore because, he said "70% of the world's population lives within a five-hour flight from there. The old economies are not growing as fast, and the emerging economies are going to do things differently."

The key change, he said, would be in the relationship between supplier and customer. This was already apparent in the way Cisco was sharing risk in systems development projects with firms like HCL. "You have to bet on co-creation," he said.

Several delegates noted that increasingly complexity of supplier relationships was encouraging them to pick fewer partners, either to simplify their choices, or to off-load the technology burden.

Deutsche Bank's McCarthy said that at one point the bank had outsourced some 70% of its IT operations, but that had been unsatisfactory. Now it is around half.

"That feels about right," he said. "Proximity to the market and its resources are vital when you have to decide how and when a product hits the tipping points between high value, flow and volume, and you need different resources at each of those points."

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