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For most business executives, IT is confusing and expensive, with ever-escalating capital expenditures and operating budgets and poorly understood RoI.
Does it need to be that way? The answer is no. IT can and should be a well-understood function for business leaders.
In the coming decades, all functional leaders will need to develop understanding of systems and technologies in order to work cohesively with other business functions towards building a competitive edge for their organisations. And this can be made possible by an IT leadership that understands business and can communicate effectively with various organisational functions in business language, not IT language.
I have been fortunate to have worked in quite a few CPG companies. While I have seen many CEOs completely frustrated with IT, I have also seen two companies where IT was highly respected.
The differentiator was the IT leadership. Let me illustrate this with examples.
Example #1: I joined Frito Lay in 1982 as a Senior Director of R&D. As an organisation, Frito Lay was run as a hybrid of centralised and decentralised functions. Some functions such as R&D and IT were centralised while other functions such as sales were decentralised. Charlie Feld, the CIO at Frito Lay had a clear belief that IT can and should help drive business growth. He used a two-pronged approach to achieve this:
1. Understand key drivers of business growth and provide an IT technology solution
2. Ensure that all business and functional leaders at Frito Lay understood what IT could do for them and to ensure that they had a reasonable understanding of the systems and technology.
Feld explained what IT systems could do for driving sales and profits in ways that business people understood. The IT function at Frito Lay has been a vital part of the companys success for the past three decades.
Example #2: The Wm. Wrigley Jr. Company had experienced steady growth for over a hundred years. By 2000, the rate of growth was barely in low single digits when Bill Wrigley, Jr. took over as the CEO of the company at a relatively young age of 36. He hired a completely new team of executives to revitalise the growth trajectory. One of those executives was Donagh Herlihy, who came in as the CIO.
Herlihy developed a business-focused strategy that was simple, clear and easily understood by other business leaders. Clear statement of business case and constant communications with business leaders led to a strong role for IT in the company. IT played a significant part in catapulting companys sales from one billion dollars to over five billion dollars within seven years.It is indeed all about leadership.Great IT leaders have excellent technical competencies, but they also have good business understanding, communication skills, and people relationship capabilities. Effective IT leaders focus on providing technology solutions for business. If you choose to leave your mark as a great IT leader, know the business-growth drivers, communicate with business leaders in their language, and build a business-focussed IT team.
The author is President, Arora Innovations and had been associated with Wm. Wrigley Jr. Company, USA as its Chief Innovation Officer of. His book, Riding the Blue Train, A Leadership Plan for Explosive Growth, has been published in several languages.
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