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strategy and business
 / Spring 2008 / Issue 50(originally published by Booz & Company)


The Practical Visionary

Doing Well, Doing Good
Bill Piatt is another CIO who exemplifies these ideas. When he joined the International Finance Corporation (IFC) in early 2007, the IT department was organized around the delivery of projects and services, and it did a pretty good job at that. But its role was essentially reactive. “Until someone came and asked us to do something, we weren’t really involved in the discussion,” says Piatt. It wasn’t that the department, called Corporate Business Informatics (CBI), couldn’t keep up with the requests. The problem was that all it got were requests, typically from departments that had already worked out what they wanted, whether or not those plans would fit well within the IFC’s IT environment. Still, the status quo functioned adequately — until the bank decided to overhaul its operating strategy.

The IFC is the private-sector arm of the World Bank Group, providing investment and advisory ser­vices to companies in emerging markets, often in the poorest countries and regions, where the private sector can play a vital role in development. The IFC provides loans, equity investments, structured finance, and local currency financing. Established in 1956, it now employs about 4,000 people in 140 offices in 110 countries. It will contribute $1.75 billion over the next four years to the International Development Association, the unit of the World Bank Group that makes concessionary loans to impoverished nations, while a portion of the corporation’s retained earnings are earmarked for the provision of advisory services directly to clients in critical areas, such as corporate governance, or to governments on how to improve their business and investment climates.

Until recently, all investment decisions were made at the IFC’s headquarters in Washington, D.C. But the kinds of deals it makes have changed significantly: Early on, the IFC primarily funded projects in which companies based in developed countries made investments in developing countries; now, more than two-thirds of its investments are to companies with roots in those developing nations. Given those changes, the IFC’s management is accelerating its decentralization, with a goal of making decisions in the field on all but the largest loans and equity investments. That strategic decision is having an enormous impact on CBI, and on Piatt’s role.

The new direction has increased urgency among Piatt’s IT staff to implement several technology initiatives intended to support decentralization at the IFC. The first is customer relationship management, which includes handling all contacts with the IFC’s clients: maintaining up-to-date knowledge about the IFC’s relationships with each client organization, the organizations’ leadership, and their record of achieving development impact with the funds and advisory services IFC has provided. The second technology initiative is knowledge management, which involves gathering, organizing, and disseminating the corporation’s global expertise that might prove useful to clients — a mining operation in remote Brazil might benefit from information gleaned from a similar effort in Indonesia, for instance. The third initiative involves the same problems any global enterprise faces in tying together its thousands of employees all over the world — only more so, given the remote regions where the IFC does business, and the diverse partners, from global banks to village-based agencies, with whom it works. Finally, in hopes of achieving Piatt’s goal of leveraging the operational data the corporation has been collecting, his staff is putting together an advanced business intelligence capability, built on its current client databases, that can provide insight to the executive management and business leaders who are responsible for both business growth and the overall development impact of the IFC’s efforts.

Given the urgency and importance of these efforts, Piatt has spent a great deal of time on governance. When he first arrived, says Piatt, “The governance process was problematic. The IT function had little visibility in the executive suite. So I spent a lot of time there, talking with our leadership to ensure we were aligned with their thinking. As a result, even though I do not have a vice president rank associated with being the CIO, I have full access to leaders at all levels of senior management, including the CEO.”

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  1. Allan E. Alter, “The Role of the CIO: Setting a Strategic Course,” CIO Insight, April 2007: Last year’s very informative update of a long-running survey of top IT executives on CIOs and their position within their companies.
  2. Marianne Broadbent, The New CIO Leader: Setting the Agenda and Delivering Results (Harvard Business School Press, 2004): This tough-minded survey of how top IT executives succeed offers advice rooted in the realpolitik of the world of the corporate CIO.
  3. Nicholas G. Carr, Does IT Matter? Information Technology and the Corrosion of Competitive Advantage (Harvard Business School Press, 2004): The book-length version of Carr’s seminal, and controversial, article on IT and corporate strategy. A must-read for those interested in either subject.
  4. Rich Kauffeld, Johan Sauer, and Sara Bergson, “Partners at the Point of Sale,” s+b, Autumn 2007: Description of how shelf-centered collaboration among manufacturers and retailers provides a major new opportunity for the strategic CIO.
  5. National Basketball Association Web site: Even if you aren’t a basketball fan, it’s worth taking a look at the state of the art in Web site technology.
  6. For more articles on IT and technology, sign up for s+b’s RSS feed.
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