Mr. McKinley, with unwavering backing from CEO David Komansky, has continued to ably find the seam in the process at Merrill and deftly maneuver his way into close working relationships with every business unit, even when he anticipates (and finds) resistance. Earlier this year, Mr. McKinley boldly pitched Merrill business unit heads on a new commitment to technology, even as the company was about to initiate a round of firings. His strategy is for the business units to use their limited technology budgets to build customer retention programs; he argues that it’s far less expensive to generate more business from existing clients than to acquire new ones. Some of Mr. McKinley’s ideas include enhanced customer relationship management databases, more client self-service programs both on the Web and off, and new products like a Net-based portfolio analysis service to help customers assess their investments.
“Projects fail — no business unit would consent to them — unless they have a financial and company value benchmark to meet,” Mr. McKinley said a few years ago in an interview. “If it’s not a sustainable model financially, it’s a waste of resources. In the early days of e-business, people said, ‘You can’t measure Web profitability and return on investment.’ Well, everything can be measured. Ultimately, if you can’t measure something, you can’t improve it.”
Spoken like a CIO to whom corporate process is not an alien concept.
A Brighter Future
In the last five years, CEOs and CIOs have demonstrated that they can work together in any number of industries in a variety of circumstances. The CEO whose public commitment to his CIO drew a round of laughter at that seminar ran a company in which every strategic initiative had a technology component. In the face of difficult conditions in the CEO’s industry, the transformation of his company through technology is one of the few positive operational achievements keeping manufacturing and sales operations from collapsing.
Similarly, the CIO who steps up to the challenges of building and maintaining a strong relationship with the rest of the management team will soon realize the competitive advantage of information technology. Tactical attempts to bridge the distance in this relationship by improving organization, communication, and process are just the beginning. But they’re essential first steps toward the increased revenue, efficiencies, cost cutting, and innovation that can potentially result from a healthy partnership.
And who knows? Maybe then, no one will laugh.
The Four Roles of the CIO
The office of the CIO has one desk and at least four different chairs. At different times and in different situations, the CIO is called upon to be a strategist, a business advisor, an IT executive, and an enterprise architect. These four roles require substantially different skills, and each one is critical to ensuring the success of IT in supporting and enabling the business.
The Strategist is on the senior executive team and helps define and structure the business. The strategist understands the opportunities presented by technology as well as its costs and risks. The successful strategist will translate IT’s potential into meaningful financial and business capabilities and evaluate the future payoff of uncertain technologies.
The Business Advisor is a peer to the business unit heads and helps translate IT’s value to and impact on day-to-day business processes and practices. The advisor’s primary objective is the delivery and capture of value, which, in turn, requires tight linkages to each business unit’s strategy and processes. The successful advisor will translate IT investments into tangible, realizable, measurable benefits. At the same time, the advisor will translate, communicate, and deliver value in ways that can be understood by the businesses. Key focus areas are process and organization redesign, business case development, application delivery, rollout, and training.
Because IT organizations can be large and complex, with responsibility for managing and ensuring 24/7 operations across a broad range of infrastructure, including networks, desktops, mainframes, telecommunications, and application development, the IT Executive is accountable for skills, training, assets, investments, reliability, and the security of all systems. This executive manages the cost and performance of a broad array of external service providers, contractors, and outsourcers. Such fiscal demands stretch the traditional IT skill set, and the job resembles program management for a major product platform.
The Architect creates an enterprise architecture that optimizes investment, enables growth, and ensures linkage to the extended enterprise. And he or she does so without sacrificing security or reliability. The architect’s key challenges are maintaining scalability to flex with the business, introducing technologies, and driving system migration planning and sunsetting of legacy systems.