CFOs have said to me that CIOs want a seat at the executive table, but unfortunately, the only thing they offer is cost cutting. Make no mistake, lowering the cost of IT is important, but these days it’s table stakes. You’re expected to do that. So how do you earn a seat at the table? Think new ideas; think about what it means to use technology to truly transform a service business.
You’re most likely the CIO of a service company. Eighty to 90 percent of the U.S. economy is a service economy. So what does that mean? What is service? Is it answering the phone nicely from Bangalore? Is it flipping burgers at In-and-Out burgers? No. Service is delivering information that’s personal and relevant to your customers. Whether that’s asking the concierge at the hotel you’re staying at for an affordable Thai restaurant within walking distance and getting the right answer, or having your doctor say that based on your genome and lifestyle you need to be on this drug and start exercising, service is information — personal and relevant to you.
The Amazon Lesson
Why is that important for you as an IT professional? I’m going to use Amazon as an example. When you log on to the Amazon website, it’s trying to deliver information that’s personal and relevant to you. Now try to locate the transaction-processing system. If you haven’t found it, it’s that little shopping cart in the upper right hand corner — pretty hard to find, right? So how important is it? Not very. Like many of you, I’ve spent my career making transaction processing more reliable, available and scalable, whether those are ATM systems or implementing an order-to-cash business process flow. But how important are these going forward? Not very.
Let me draw your attention to your favorite financial services website. Of course, you have to log in, but from that point on you are interacting with a “shopping cart,” a transaction processing system. You can debit, credit, purchase or sell a stock, reliably and with data integrity, but does the system deliver service — information that is personal and relevant to you? Could it say, “People like you bought a particular stock today,” or “People like you refinanced their mortgage today”? Could your financial services firm deliver information that is personal and relevant to you?
Or consider this scenario. Four weeks ago, you bought some royal blue tiles at a big box home improvement store; three weeks ago, you bought a vanity; last week you bought a sink. Of course, you’re remodeling your bathroom. Why, then, isn’t anyone sending you an email or an instant message telling you that a certain toilet is available today in royal blue at a 10 percent discount and you can pick it up with her compliments? Service is information, personal and relevant to you.
Making IT Relevant
The challenge today is not a lack of information. Your company and every company have at least 10 or 100 Internets full of data. The challenge now is to make that information personal and relevant. Why is this so hard?
The first thing you need to realize is that you’re a victim of the SQL hammer. If having a hammer means everything is a nail, then it’s the same for SQL. Imagine, for instance, that Google’s search engine (which is trying to deliver information that is personal and relevant to you) was built by a group of SQL engineers. First, they would have designed a global data schema for all the information on the planet. Then they would have used the extract, transform and load (ETL) process and data-cleansing tools to bring all the information on the planet into their global SQL database. Finally, they would write reports such as: “Places to camp in France,” or “Chinese restaurants in Hickory, N.C.” After 10 years and tens of millions of dollars, the team would probably have given up. Fortunately, Google didn’t take that approach.
New Service Technology
The point is that you need new hammers — and new approaches — to reach these new goals. The whole conversation about the consumerization of IT is taking you in the wrong direction. Sure, debating whether your employees should or shouldn’t be posting to Facebook at work, or how to block access to Dropbox, are warranted. But the bigger discussion should be about how you bring the technologies born in the consumer world and apply them to the challenges of delivering information that is personal and relevant to your customers and suppliers.
My advice? Start studying up on Hadoop, Lucene, Hive, Mahout and Cassandra. These technologies are being used by consumer applications to make sense of and deliver super-large volumes of information [a.k.a. Big Data] that is personal and relevant to you. Start a simple project that uses one of these hammers to build a service system for your customers and suppliers. That’s how to earn a seat at the table. When you’ve figured out how to deliver information that is personal and relevant to a retail, education, financial services, health-care, high-technology or government customer, then you’ll be welcome at the head of the table.
Timothy Chou teaches cloud computing at Stanford University. He is the former president of Oracle On Demand, a founder of cloudbook.net and author of Cloud: Seven Clear Business Models. This blog was adapted from an article in CFO magazine.