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IT Leaders: Reinventing IT asa Strategic Business Partner

CIO Steve Olive isnt handing out any gold stars to

IT for providing good PC support or networingservice at Raytheon Integrated !efense Syste"s#$Consistently relia%le and e&cellent IT serviceshould %e a given'( he says# $)hat %usinesses need and ITshould %e providing are innovative solutions to %usinesschallenges#( That "eans creatively applying technology toproduce goods "ore e*ciently and at a lower cost' to selland service "ore of the"' and to do so at the highest possi%lepro+t "argins#It also "eans using IT to create new products and servicesand even whole new %usiness "odels' says !arryl Le"echa'CIO at ChoicePoint Inc# Because technology ise"%edded in ,ust a%out everything a co"pany does' $technologystrategy and %usiness strategy are now one#( -athleen

.c/ulty' CIO at The Schwan 0ood Co#' puts it thisway: $Its not a%out IT auto"ating the %usiness any"ore#Its a%out innovating it' i"proving it#( So forget a%out ITsupporting the %usiness# IT leaders are focused on reinventingthe %usiness' starting with the IT organi1ation#

Their ti"ing couldnt %e %etter# 2ccording to 3artnerInc#' within +ve years' 45 percent of chief e&ecutives will"ae their CIOs responsi%le for using infor"ation as a strategic6read: revenue7generating8 asset# 3artner also predictsthat 95 percent of COs will "ae CIOs responsi%le for%usiness "odel innovation#IT e&ecutives such as ;ohn

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"ini"u" of three days in the +eld every year' woring in astore' a warehouse' or a depart"ent such as +nance or payroll#$That way' they now what the %usiness really needsand how to help'( he says# $ou dont have a supply chainsyste" or +nancial syste" that wors in a %o& or a point7ofsalesyste" that ,ust taes "oney# /ow we have highly integrateddata ows' so every pro,ect re@uires an understanding

of all syste"s and all %usiness areas#( By nowing the %usiness'$they %etter understand why they "ight get a call forsupport at D:55 in the "orning'( he adds#2t ChoicePoint' Le"echa created a federated structurewith two %ands of IT positions: one for technical worers'who hold the title of IT architectE and one for "anagers' whohold the title of %usiness infor"ation o*cer 6BIO8# $)e%elieve in two independent career paths# ;ust %ecause youdont "anage people doesnt "ean you should %e li"ited inhow far you go in the co"pany'( he says#

The BIOs are e"%edded in each of ChoicePoints %usinessesand act as local CIOs# $They understand the operationalissues' they now all of the people' and they spend D55percent of their ti"e in the %usiness units'( where they can

directly aAect %usinessFIT align"ent' Le"echa says# $Theynow and understand the %usiness %ecause they live in the%usiness'( he says# The chief %ene+t of this arrange"ent is$when you +& the align"ent pro%le"s' you do the right ITpro,ects and' ulti"ately' i"pact revenue and get %etter custo"erservice'( Le"echa says# ChoicePoints consistent revenuegrowth' ranging %etween G percent and DG percentannually for the past several years' is no coincidence#2t Cincinnati7%ased Procter > 3a"%le 6P>38' theco"panys top IT pro,ect over the past three years has %eento reinvent IT itself according to a four7year strategicalign"ent plan# $In the last year' we reshaped' rena"ed'refocused and %egan retraining our H'G557person IT tea"'(says Passerini' who is glo%al %usiness services o*cer in

addition to CIO# The IT depart"ent was rena"ed Infor"ation> !ecision Solutions 6I!S8# The new I!S group wasthen "erged into P>3s 3lo%al Business Services sharedservicesorgani1ation' which is also ho"e to the hu"anresources' +nance' strategic planning' and relocation functions#I!S staAers focus on high7level' IT7ena%led %usinesspro,ects e&clusivelyE routine IT tass are outsourced to3'( Passerini says# $The whole idea isrunning IT as a %usiness' %ut not necessarily using Ktraditional

return7on7invest"ent +nancial "easures to @uantifyITs value'( he says# $In the end' no one %elieves those nu"%ersanyhow# The nu"%ers you want are higher pro+ts'

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"aret share' and volu"es# In reality' its all a%out the relevancyof ITs contri%ution to the %usiness'( Passerini adds#

That is how ITs value is "easured at P>3#= ntertain"ent Television in Los 2ngeles has radicallydeparted fro" its traditional "odel of separate IT and television%roadcast operations# The change coincides with the%roadcast sides shift fro" tape to digital technology# Before'

separate vice presidents oversaw online' television networ'and IT operations# /ow there is a single senior vice presidentof technology and operations E ideas' designs' technology'and pro,ects are shared a"ong all three operations#0or e&a"ple' IT personnel were involved in the designof = Online content fro" the ti"e the site was +rstlaunched in Octo%er H554' notes Bennett' e&ecutive directorof %usiness applications# $Before' we would have gotten thespecs and %uilt it "uch lie a contractor'( he says# $But now'IT was in on %randing discussions and audience focus groupsfro" the %eginning# $)hat weve done is atten the "orefor"al Ksoftware develop"ent processes and "ade the""ore person7to7person( as a way to develop products andservices faster across all "edia' Bennett says# $2s we interact

with e&ecutives and users and release software iteratively'were also gaining greater do"ain nowledge a%out the%usiness'( he notes#

;ust recently' IT participated in a discussion a%out oAeringan online feature that would let )e% viewers of = Onlinevote on whether cele%rities on the red carpet at the3olden 3lo%e and Oscar cele%rations are hot or not# $/owthats not a traditional discussion or conversation you wouldhave in IT'( Bennett notes wryly' $%ut now were thininga%out these inds of things across all "edia#( Mnder the neworgani1ational structure' $theres constant interaction ande&change of infor"ation and ideas through hu"an contact#2s opposed to %eing assigned to a user depart"ent' IT isconstantly interacting across "edia'( he says# $oure "ore

of a partner with the %usiness# oure creating products together#IT is de+nitely stepping out fro" %ehind the shadowsof %aco*ce corporate syste"s#($Its very "uch a diAerent "ind7set'( says RaytheonsOlive' whose overhauled IT organi1ation now includes custo"errelationship "anagers who are e"%edded in the %usiness'plus D5 tea"s of technical worers who support ITfra"ewors such as infrastructure' application support' anddestop services# The vast "a,ority of those technical worersare $ho"e7roo"ed( in cross7%usiness tea"s that woron pro,ects that the custo"er relationship "anagers %ring tothe"' he notes#$It too two years for this "odel to really ,ell# 2t +rst'there was a little %it of tension while the clarity of roles and

responsi%ilities was a little confusing'( Olive acnowledges#$But once we de+ned roles and responsi%ilities' it i"proved"orale and wored to create a highly "otivated worforce%ecause we were "aing higher7level contri%utions to the%usiness#(Source: 2dapted fro" ;ulia -ing' $