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Opinions expressed on this blog reflect the writer’s views and not the position of the Capgemini Group

Crisis? Hurray, Crisis!

Category : Strategy

Think about it: many spiritual, self-help, motivational gurus first have been through a period of devastating crisis before becoming the source of all energy and light. Whether you are Louise Hay, Tony Robbins, Byron Katie, Eckhart Tolle, Rhonda Byrne, or (forgive me) even Buddha, apparently you have to face your deepest moments of agony and depression first and only then you may break on through to the other side. No renewal without a proper catharsis first. I guess we may have found an interesting lesson for many CIO’s too. Our Business & Information Strategy unit is currently finalizing its annual worldwide CIO survey. The main focus is on innovation and although I haven’t seen any results yet (more about it on this blog soon), we can safely assume that more and more CIO’s will need to innovate in 2008. Clearly, business leaders expect solid growth from a new wave of emerging technologies, inspired by many opportunities in the world of web 2.0, networked co-creation and extreme collaboration. And they will turn to the CIO, who may or may not have a pile of good, innovative ideas. Here’s another prediction for a CIO survey 2008 insight: also more than ever, IT executives will feel impeded in their ability to innovate, constrained as they are by a myriad of heterogeneous, overlapping systems that are difficult to integrate, manage and access in a secure way. These systems typically contain legacy, bespoke applications but there may also be highly customised, multiple instances of ERP packages, 4GL solutions from the roaring nineties and ad-hoc, hacked web solutions from the past few years. Many of us can instantaneously relate to this, and we all recognize the massive wall of can’t do / won’t do / too risky / too difficult into which creative, new ideas are destined to smash into. What can we do? We need to create headroom for innovation by terminating legacy applications, getting rid of the overlap, introducing more packaged – not customised - software, decreasing the number of suppliers and platforms, balancing centralised and decentralised, leveraging alternative sourcing strategies, embracing open standards and applying service oriented architecture to support all of that. We need to deal with IT that doesn’t matter, so that we can apply IT that matters. In spiritual terms: we need the carefully crafted serenity of a Zen garden in our IT household, because it is the only type of platform that will enable us to continuously grow and innovate. Really, this is no rocket science. We all know what to do. The only question is how to get there. This requires making firm, often unpopular decisions and showing resolute leadership. Also, it introduces high risk, as we are talking about a radical transformation. Enough reasons for many CIO’s – and their counterparts in the boardroom – to wait a little longer. They just bear with the pent-up demand from frustrated users in business that see examples of the innovative use of technology outside the company every day. Some of the CIO’s I met in 2007 were in this petrified state, seemingly unable to escape from the deadlock. But yet others had forced a breakthrough and were actually executing on their strategy. Their secret? Well, certainly not just trust on the Law of Attraction and simply believe that it all will happen (interesting management approach, though). Their real secret? Crisis. Almost all of the CIO’s that successfully turned around their IT, embraced some form of crisis to achieve what otherwise seemed unthinkable. Just recently, a CIO of a big utility company brought back his scattered portfolio of 900+ incompatible applications to just 20 standard modules. Forced by massive external competition, his company had suddenly decided to completely replace their operational infrastructure within two years. And the supporting new IT systems had to be ready in just a few months. This called for dramatic measures and the CIO took advantage of this unique point in time to set up a simplified, standardised platform, essentially rendering his existing IT inoperative within two years. A CIO of a manufacturing company had desperately struggled for years with her shattered, unmanageable IT systems. Only to find that an unexpected merger with two other companies finally gave her the opportunity to create that business case for master data management and a new, package-based solution. And the newly appointed CIO of a recently formed financial services consortium already made a career in terminating and replacing existing systems in complex merger situations, having to cope with massive cuts of the overall IT budget. Of course, we don’t always need a crisis to execute on our strategy. I vividly remember the case of Oracle, aggressively consolidating its own internal IT in less than half a year. Larry Ellison had decided so, and then things just tend to happen within Oracle. It helps. Also, good common sense, a clearly defined business case, the right communication skills and a healthy appetite for risk can do the job. In any case, the frustrated CIO’s of 2008 may want to keep their eyes wide open for these valuable, scarce windows of opportunity. Finally, the crisis we need! Things may not turn out so bad after all. If the blood is on every wall and there is chaos, confusion and misery all around: cheer up. This might just be the way forward we were looking for.

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Ron Tolido

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