Posts Tagged ‘IT leadership’


It can be very challenging to manage a cost center where the CEO feels that the value provided is insufficient for the costs.  Yet that is the very situation many CIOs face every day.  How did such a difficult circumstance arise, and what can be done to overcome it?

If the CEO thinks IT doesn’t deliver enough value for the buck, that can’t be a good thing

Years ago I recall reading that the purpose of technology within a company is three-fold:  increase revenue, reduce costs, and enhance the differences that cause a Finding Valuecustomer to select our company over our competition.  But while we understood this in a theoretical sense, IT at most companies became primarily dedicated to cutting costs.  Many of the factors contributing to this were addressed in my post on Moving IT from Cost-Cutter to Difference-Maker.  As this post indicated, cost centers are typically managed by continually reducing their budget.  This results in an even larger percentage of the IT budget dedicated to keeping the lights on and fewer dollars available for technology projects to move the company forward.  It is important for IT to move away from being seen as a cost center toward being a business driver.

But even being seen as a cost center does not necessarily cause the CEO to believe that IT costs are too high for the value received.  After all, you don’t often hear that cost centers like Accounting or Procurement are too expensive.  And while the size of the technology expenditure quickly shines a spotlight on IT, that in itself doesn’t mean that the company is not receiving enough bang for its technology buck.

How is the CEO supposed to know the value IT brings?

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IT professionals typically choose to enter the profession because they enjoy technology.  They like to solve problems through careful analysis.  They pay great attention to details.  They are tough-minded in that they want to keep digging until the problem is resolved to their satisfaction.  They enjoy bringing order out of chaos but then again, they become easily bored by processes they see as repetitive and mundane.   They love to tinker and change things to make them better.  They are fascinated by the challenge of learning something new.

Learning the business hasn’t been a high priority

Many in IT pride themselves on their technical skills rather than their business proficiency.  They see themselves as IT jumping hurdlesprofessionals rather than bankers, manufacturers, or retailers (see “What Business Are You In?”)  They reason that they can easily take their skills to another industry using similar technology.  As such, these professionals are much more invested in learning and understanding technology rather than the business of the company currently cutting their paycheck.  This in itself is a major cause of the knowledge/communication gap between IT and the rest of the business.  It’s not that IT people are incapable of learning about the business; it just isn’t a high enough priority when compared to everything else.  It isn’t that they enjoy speaking in a tongue foreign to others and honestly, they don’t always realize that is what is happening.  It’s simply the way they think, and they have not made the effort to learn how to translate those thoughts into a common language.  Relate it to someone who wants to learn English as a second language.  It takes time and effort to learn to do so, and it doesn’t happen without motivation, commitment and dedication.

Lack of business understanding hurts your career, your IT department, & your company

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Too often it seems that almost the singular focus of IT has been to cut costs within the company.  There is no doubt about technology’s capability to bring organizational efficiency and reduce costs; however, when cost-cutting is the primary focal point, it can mean little attention being given to the ability of technology to help increase revenue, improve customer retention, enhance competitive differentiation, etc. ??????????????????????????????????????

What caused IT departments to become so narrowly focused on cost-cutting?  Obviously years of economic uncertainties and difficulties had a huge effect.  But perhaps factors internal to the company played an even larger role.

Instead of seeing themselves as business professionals with an expertise in technology, many IT professionals instead view themselves as technologists.  As a result, they have not concentrated on truly learning the business of the company actually cutting their paycheck.  After all, the reasoning seems to be, why should I see myself as a banker or a manufacturer when my technical capabilities will easily allow me to move to another industry the next time I need a job.  Failure to gain a knowledge of the business makes it easy to see why these IT professionals do not speak the language of business… they don’t know it.  We all know the difficulties this causes in communication, but we must also admit that this lack of business knowledge prevents IT professionals from contributing as much to the success of the company.  It also makes it extremely difficult for IT to communicate the value they are bringing and likely prevents them from even being aware of what they might be doing to enhance competitive advantage or increase revenue.  Without exhibiting a firm grasp of the business, IT is often pushed into an order-taker role.  And it doesn’t help that the natural introvert tendencies of many IT professionals (including the CIO) are sometimes allowed to become barriers to developing solid relationships with corporate leaders within other areas.

I’m not telling you it’s going to be easy. I’m telling you it will be worth it.

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Be Flexible - GumbyResistance can be good or bad.  For example, resistance-based exercises can aid in becoming more physically fit. Informed resistance  to proposed change within your organization may signal that additional considerations are needed to possibly modify the proposal to overcome potential issues or perhaps present a stronger result.  On the other hand, resistance can be problematic when it results from closed-mindedness.

What causes resistance within IT…and how can it be overcome?

Too often the corporate IT department is perceived by those they serve as being resistant…and this resistance is definitely not seen as a good thing.  But what causes it…and how can it be overcome?

The IT profession is based upon logic.  It’s all just 1’s and 0’s, right?  Definitive rules and order are required for integration and operability.  The profession attracts people that are very logical.  They are problem-solvers whose analytical minds look for patterns to help resolve errors and detect root causes.  IT professionals often have a tendency to solve problems in their heads within the context of what they know — even as you are still in the process of explaining the issue.  At times this tendency causes some to prematurely jump to an incorrect conclusion without hearing the entire scenario.

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What one word would you use to describe your IT department?

Obviously one might receive a different response if this question was asked of someone within IT versus an individual receiving IT services.  There are various other factors that might affect the response as well – things like the respondent’s frequency of interaction with IT or relationship with members of the IT staff.  Perhaps their level of knowledge about everything IT does would be a factor.  They could be influenced by the speed of their PC or the size of their monitor.  The respondent’s level of authority often seems to be a factor in their opinion of IT.Transform 2

Some IT staff members might describe their department using words like strategic, visionary, leaders, hard-working, and service-oriented.  More often you hear words like overwhelmed, understaffed, handcuffed, stressed, unappreciated, order-takers, and helpless-desk.

When asking those in departments outside IT, you could hear words like focused, hard-working, appreciated, needed, and understaffed.  But in far too many cases, the description is more akin to words like slow, costly, controlling, reactive, roadblock, resistant, poor-service, techies, inflexible, internally-focused, and even necessary-evil.

“How many of you know someone who is not really happy with their IT department?”

We have to admit that the descriptions of IT departments throughout the world tend heavily toward the negative side.  I once asked a room of senior executives from various disciplines, companies, and industries, “How many of you know someone who is not really happy with their IT department?”  The room erupted in laughter.  There seemed to be almost unanimous agreement with the one executive who exclaimed, “No one is happy with their IT shop!”

So what if we changed the question just a bit.  What if we asked, “What one word do you wish described your IT department?” 

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