Getting Value from IT Professor Rob Edwards and Rob Lambert Marc Whitmore Chris Edwards, Rob Lambert from the Management Information Systems Group here at Cranfield, we are in tough times, value is at the top of everybody’s agenda right now. The IT director who says I find it really difficult to get face time with my boss at the moment; he is more concerned with what the customer is after, really has a view of what I am doing as IT as plumbing. What help you can give the IT director to frame the debate around that sort of thing, because it seems to me there is value in IT, but as an outsider, I am not clear where it is? Chris Edwards I think a lot of people ask that very question. I think you have got to start by recognising that IT is plumbing for a start; that it’s all about being able to do the right things at the right time. So your e‐mail system has got to work and it’s got to work every day; your logistics system has got to get the goods off to the customers. The basics have absolutely got to be right. That is the beginning, that is taken for granted, that is what everybody does – and if they don’t do that they shouldn’t even be in the job. So what is the next step up this staircase? I think it’s about saying what is our business trying to achieve and how can IT help us achieve that? Let’s try and explain with an example, that might be clearer. Imagine a police force, imagine a police force when it goes to interview somebody – either stops a car or knocks on somebody’s door – we want those officers to understand what is going to happen before it happens. I don’t want to stop some guy who is … Rob Lambert Armed, dangerous … Chris Edwards Absolutely – armed and dangerous. We don’t want that, we want to know that this is guy is armed and dangerous. We want to know that this guy has been charged previously for certain offences. We want to know the whole story, instantly, before we ask them. Now that is absolutely central to a force. If a force can do that it will start to achieve its aims; and it seems to me that is an example of adding value rather than just the basic plumbing of running the basic systems that they have. Rob Lambert Where we tend to work with organisations is we try to get actually IT folk to work with their business partners around what is really critical to the success of the organisation. So as Chris Knowledge Interchange Online© Cranfield University October 2009 1 Chris Edwards and Rob Lambert
said, having information about apprehending crooks before you pick them up – that sort of information. It gets stakeholders working with the IT department in a collaborative way. Much of what we do is get their business colleagues to understand what are they trying to achieve? What is important to them? How are they defining value and what does value look like? So it’s very much a collaborative approach to work with the business to understand what is important to them rather than trying to second guess them. So that is where we tend to work. Marc Whitmore OK, you have talked a little bit about the why, you have started to talk a little bit about the what and the how – academics, sage on the stage, all very well and good being out here in Cranfield with your books. How does that translate into real world value for IT professionals? What do you do to help them actually tackle this problem on a day to day basis? Chris Edwards I think we are unique – but then of course everyone would say that wouldn’t they? So let’s try and explain why we are unique. We are not trainers; we are not a bunch of guys that stand in front of your and tell you about something and then walk away. Equally we are not your consultants that come and do it for you. We are the cross between the two. What we will do is work with organisations to understand their issues, then present a tool, an approach, or whatever with them and then work through it with them and apply it in their setting, dealing with their issues. We try not to use fictitious cases; we try to use your case, your business. We try to turn it into something which is all about your organisation. Often weeks after the event we will go back and see how they are going on and maybe if they are going offline a little bit, we will try to bring them back onto script. So we are somewhere between a training organisation on the one hand and a consultancy on the other; but we really are quite unique. Marc Whitmore In terms of the people that you work with usually though, tell me a little bit more – we talked about IT as plumbing, is that essentially the sort of people you work with? You just engage with IT directors who are trying to make sure that the trains run on time? What do you see the role of the IT director in a company as being? Rob Lambert I think that is changing. We have recently done some joint research with Deloittes looking at the role of the IT director, the CIO in fact. And actually what we found is that its transitory. There is no one single role for a CIO; it depends on the context © Cranfield University October 2009 2 Chris Edwards and Rob Lambert
of the organisation. Sometimes the CIO should just focus on the plumbing and keeping the lights on – the day to day activities. In other organisations they need the CIO to take a more innovative role to help them understand what strategic opportunities might be available to that organisation. But it is very, very contextual and I think the difficulty for many organisations is working out what sort of CIO do we need – do we need this sort of CIO or that sort of CIO? And I think the whole area in many organisations is confused. Chris Edwards Absolutely, I think an interesting question is where CIOs will be in 25 years. Will they exist? There will clearly be somebody in there that is keeping the plumbing going; take that for granted. But will there be somebody in there that is inspiring the organisation to use information in different innovative ways? Or will that have become just second nature to every manager in the business? The guys that are coming up now, the guys that are at university today, are doing this as second nature. Eventually they will be right at the very pinnacle of organisations and when that happens will you actually need somebody to inspire all of these managers to do things differently, or will it just be second nature? And the question really is will CIOs exist in twenty five years time or will we just need somebody to run the plumbing? Marc Whitmore Sure, OK. We come back to the example we started off with first of all; the individual who is struggling with their boss at the moment to get face time around IT. If you had maybe one or two key questions that you could say both to the boss and the IT director, these are the things you should be answering, the two of you, to make sure IT is delivering value, what sort of things would they be. Rob Lambert The first thing, Chris has already mentioned about value. Focusing on value. We have techniques here that help people work with the business to focus on value. One area we have worked on more recently is actually we have unveiled the myth of business cases. In most organisations business cases for investments in IT are – in some organisations, works of fiction. If you have one question, it’s to talk to the CIO and the CEO and say how good are your business cases? Do they actually represent a good view of the cost, the benefits, and how are you going to track that through? That requires high quality, early thinking. Much of what we do with organisations actually filter out the less good investments which actually makes a significant © Cranfield University October 2009 3 Chris Edwards and Rob Lambert
difference to the value they get overall. Marc Whitmore Chris, any thoughts from that? Chris Edwards When we were doing the work with Deloittes there was a guy on the phone that we talked to and he made a comment that stuck in my mind. He said most CEOs don’t know how to treat CIOs because they have never seen a good one. And I think there is some truth in that. CEOs don’t know what to expect, they don’t know what to demand. They know what to expect of the finance director and the marketing director because they have seen good ones, but they have never actually seen a good CIO, so they don’t know what to demand. And I think the things that I would put on that list are I expect you to sort the plumbing – that’s got to be done, not by you, maybe by an outsourcer, maybe by one of your senior deputies. But I don’t want you doing that. I want you turning this business into something different that is something special. I want you to be part of this management team. I want you not to discuss items just about IT, I want you to discuss items about running this business and shout real loud when IT can do something special for us. I want you to be our conscience to make sure we are right at the very pinnacle of using IT to our advantage. Marc Whitmore Chris, Rob, thank you very much for your time. © Cranfield University October 2009 4