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March 2010
CIOs can strongly influence corporate boards with or without a seat at the table.
By Jennifer Zaino
When Joseph Y. Gallo, CIO of The Dispatch Printing Co. in Columbus, Ohio, was promoted to Executive Vice President and voted onto the board of directors in January, it was affirmation that CIOs are truly having an impact on business.
Many others would like to hear words such as those offered by The Dispatch’s Michael J. Fiorile, Chief Operating Officer and company President, who said in a statement: “Joe has been a real asset to our company, as all of our media properties are being impacted by changing technologies. His leadership skills, experience in strategic thinking and his knowledge of project management will contribute significantly to our company's growth.”
In fact, it’s still uncommon for CIOs to reach this level of recognition. One reason is that in today’s highly charged, post-financial crisis atmosphere, corporate boards are encouraged to be independent and detached from day-to-day operations. With corporate governance under scrutiny, there seems to be little appetite for giving senior executives who manage budgets a board position that might conflict with their daily duties. Indeed, even some CEOs are being discouraged from holding board seats.
Nevertheless, IT is in the spotlight as businesses increasingly depend on technology for everything they do. “If IT is not functioning, the business is not functioning, or at least it’s severely impacted,” says Ian J. Banks, Vice President, Global IT, PMC-Sierra Inc., an Internet infrastructure semiconductor solution provider in Santa Clara, Calif.
Banks, who is located near Vancouver, B.C., is president of the local chapter of the CIO Association of Canada (CIOCAN). The group recently began a joint IT leadership development program with the Learning Strategies Group of Simon Fraser University's Segal School of Business. One reason the program was developed was to advance emerging and tenured CIOs’ business skills so they can contribute more at the executive and board of directors’ level.
Banks says that corporate boards want to make sure IT expenses are justified and accountable. They also want to assure themselves that the right leadership is in place to minimize corporate risk as it relates to IT and maximize the benefits identified in the business case. CIOs should view the opened door as an opportunity to build relationships with their boards and to become a strategic partner in the business
Making Relationships Work
While it’s not new advice, honing good communications skills needs to be a key priority for those on the corporate fast-track. “CIOs have to be sensitive to how much geek-speak they include in any of their presentations,” says Sandra C. Hofmann, CIO-in-Residence at Advanced Technology Development Center (ATDC), a start-up accelerator that is part of the Enterprise Innovation Institute at Georgia Institute of Technology. No one likes to be talked down to or to be overwhelmed, says Hofmann, who also is President of the Women in Technology (WIT) organization in Atlanta and a member of its board of directors. She previously held positions as CIO and Chief People Officer at manufacturing ERP software company, MAPICS, and was a Director on the board of AAA Auto Club South. She has also served as Compensation Committee Chair for the board of directors at Akrometrix, LLC.
The need for communication skills is shared globally. Hilal Khan, Head of Corporate Strategic Information Systems at Honda Motor India Pvt. Ltd., outside of New Delhi, agrees that it’s critical to manage how you talk to board members who hail from business backgrounds. “You have to present things related to technology so that it makes business sense to them,” he says. Avoid tech jargon and speak logically, he advises. “You have to put time into it — the more we face and bridge the gap, the more beneficial it will be to the organization.”
PMC-Sierra’s Banks, who has managed sales teams in previous careers, sees huge value in learning about non-IT parts of the business. He advises CIOs to take a sales course to be more successful communicators, for example. “What they teach you in sales is how to communicate, how to present your messages in ways that resonate with your target audience and how to customize messages for key decision-makers” he says.
Of course, CIOs need to thoroughly understand the company’s business to be effective with the board. Alastair Behenna, CIO of U.K.-based global offshoring and recruiting firm Harvey Nash plc, suggests attending business meetings, getting close to finance and continuing to ask lots of questions. “Translate that curiosity you have as a techie” to improve your understanding of the business, he says. That’s not only important when presenting to boards of directors but also for being a valuable member of the company’s executive council.
CIOs also need to promote their own strengths and expertise so board members can turn to them when faced with critical decisions. Although Hofmann wasn’t on the directors’ board at MAPICS, she had considerable involvement with that group when it came to acquiring other companies. “Clearly, information systems are a key asset when you’re looking at making an acquisition or merger,” she says. “Boards are very anxious to understand whether or not they are making smart moves in that regard.”
She also sees the rise of compliance and risk management as an opportunity for CIOs to offer more value to their boards. “The CIO is in a prime spot” to be a trusted partner in risk management, she says.
Look at the board as your customer, Hofmann says. Just as you would with any group you serve, try to find out their requirements and what new information you can provide for them. One simple example: Create a dashboard to give board members a view of the enterprise across its many businesses. Offer a training session in how to use that dashboard as an entrée into a board meeting that isn’t focused on what you’re doing with your budget, how your ROI is proceeding, or other IT-business issues.
Smooth IT Operations
Of course, none of this outreach will be worthwhile if IT’s house isn’t in order first and the CIO can’t deliver new services, says Khan of Honda India. “If we’re going into an emerging market, IT should be the facilitator. You can’t say systems won’t be ready to operate in that geography for the next six months” without losing credibility.
Additionally, “CIOs can’t have a strategic dialogue with the board if they are busy trying to keep the lights on and the trains running,” says Gerard P. McNamara, Managing Partner at executive search firm Heidrick & Struggles. Indeed, “If things aren’t running well, you won’t get more accountability or responsibility,” McNamara notes.
To be strategic, CIOs know they need an outstanding operations team to back them up, McNamara says. Strategic thinkers are more poised to present strong business-oriented cases about how their technology efforts are extending corporate reach.
Establishing a high-level reputation may lead to a seat on a board at another company as well. “Boards are starting to look for more [outside] IT skills,” says Banks. “In the same way the audit committee would turn to the company CFO on financial matters,” boards are looking for IT expertise and guidance they can tap into.
Naturally, there’s a lot more to board service than showing up for meetings a few times a year and “not every CIO is prepared for a board role,” says McNamara. “The individual has to understand the scope of responsibility.” which will extend beyond his or her functional expertise.
Among the rewards of serving on another business’s board is that it adds to a CIO’s business perspective, which should be an asset back at home base. And those who prove they are committed to delivering value when they take on external board roles can also use it as a stepping-stone when opportunities arise for COO or CEO spots, for instance, or for a CIO role at a bigger brand. (See sidebar for more on how the CEO can boost your ambitions.)
Building executive-level trust will give CIOs cache if they choose to pursue a CEO career-path, too — a role many CIOs are well-qualified to hold. “The CIO’s role is different from [that of] the general manager and line-of-business executives,” who have to deliver on departmental objectives and have profit-and-loss center responsibilities, says Graham G. Rong, Chair for the MIT Sloan CIO Symposium and Board Member of MIT Sloan Alumni Club of Boston. The CIO’s perspective is more like that of the CEO, as both think and talk from the “center of the organization.” CIOs “support all the divisions” and can influence the overall business, he says. That’s a unique advantage.
Jennifer Zaino is a New York-based business and technology writer and editor.
ASK THE EXPERT:
CIO, Harvey Nash plc
Alastair Behenna is CIO of U.K.-based global offshoring and recruiting firm Harvey Nash plc. He has 23 years of experience in IT, ranging from field service through architecture, design, development, and project and program management. Behenna also worked for Novell, the BBC and Guinness before joining Harvey Nash as Head of IT in 1999. He progressed to become Group CIO in 2006, and is now taking on a portfolio and advisory role for the group as well as other clients.
Alastair is a member of Smart Enterprise Exchange and can be reached via the community e-mail.
Vice President, Global IT
PMC-Sierra Inc.
Ian J. Banks leads PMC-Sierra’s Information Technology team, which is responsible for global networks, infrastructure, applications and security. The company has a network of offices throughout North America, Europe, Israel and Asia. He has 15 years of experience in operations, sales, marketing and IT. Prior to joining PMC-Sierra in 2006, Banks led the Western Canadian IT services and software solutions team at a major telecommunications company. Banks also led the management consulting practice at Fujitsu (formerly DMR) Consulting, and was CIO at Crown Corp. He was a Visiting Professor at Simon Fraser University’s MBA Program.
Banks holds an MBA from the University of Western Ontario and is on the Board of Directors of the CIO Association of Canada, and the Saint James Community Service Society, in Vancouver.
Ian is a member of Smart Enterprise Exchange and can be reached via the community e-mail.
CIO-in-Residence
Advanced Technology Development Center
Sandra C. Hofmann is currently CIO-in-Residence at ATDC, a nationally recognized science and technology incubator headquartered at Georgia Tech. Most recently she was Chief Operating Officer at Closets and More, and prior to that, she served as Executive Vice President and Chief Operating Officer for Turknett Leadership Group, a management and consulting firm that focuses on aligning strategy, leadership and culture. Hofmann’s broad management experience includes 14 years with IBM.
She joined MAPICS as Vice President and General Manager for a newly acquired business unit and was the first female member of the executive team. She then stepped into the unique dual role of CIO and Chief People Officer and established the company’s organizational model for the “virtual office,” which she says provided enterprise efficiency and expense benefits.
The Georgia CIO Leadership Association selected Hofmann as a Georgia CIO of the Year in the 2003. She is a frequent speaker and panelist for technology and community events.
In addition, she currently serves on the Board of Directors for AAA Auto Club South, TechBridge, Women in Technology, and is the past chairman of the Board of Directors for Society for Human Resource Management, Atlanta chapter. She serves as Compensation Committee Chair for Akrometrix Board of Directors. She graduated from Georgia State University and has completed an executive management program at Stanford University.
Sandra is a member of Smart Enterprise Exchange and can be reached via the community e-mail.
Head of Corporate Strategic Information Systems
Honda Motor India Pvt. Ltd.
Hilal Khan has spent more than 17 years in the manufacturing and in the consulting industries, specializing in the IT automotive sector. At Honda, he defines and manages IT in alignment with corporate strategy.
In addition to Honda Motor India, Khan worked with DCM Toyota, Daewoo Motors India Ltd. and Global IT Options Ltd. He holds a master's degree in computer science and applications and a postgraduate diploma in management.
Hilal is a member of Smart Enterprise Exchange and can be reached via the community e-mail.
Gerard P. McNamara
Managing Partner, Heidrick & Struggles
Gerry P. McNamara works with a wide range of clients across virtually every industry, including financial services, insurance, industrial, higher education, not-for-profit, retail/consumer packaged goods, and healthcare. His expertise is in recruiting world-class technology and operations executives to help solve business problems. As Managing Partner, McNamara leads the CIO Practice across The Americas for Heidrick & Struggles.
Prior to joining Heidrick & Struggles in 1995, McNamara spent more than 15 years with IBM, where he held several high-level sales, marketing and service positions. He brings to Heidrick & Struggles an in-depth understanding of the CIO function and a particular focus on senior executive positions in financial services within the technology and operations function. Before embarking on a corporate career, he held the rank of Captain in the United States Marine Corps.
MIT CIO Symposium Co-Chair
Graham Rong has a broad backgroun in product innovation and corporate development. He has extensive experience in IT leadership, business strategy and collaborative research in North America, Asia and Europe. He is currently leading the development of a novel system for financial information and social analytics. He has held senior roles with Vignette Corp. and Harte-Hanks, and was on the faculty in JiangNan University. In addition, he held an EU research fellowship in University of Edinburgh.
As an Alfred P. Sloan Fellow in MIT Sloan School of Management, Rong focused on corporate strategy, innovation leadership and global development. He lectures at Harvard, MIT and outside of the U.S. He is on the board of multiple organizations and also on the organizing committee of multiple international conferences. He holds an MBA from Massachusetts Institute of Technology and PhD from University of Guelph, Canada.
Graham is a member of the Smart Enterprise Exchange and can be reached via e-mail on the community.
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