Financial concerns in the wake of the recession are causing companies to better align IT and business and this shift is changing what is expected from technology workers, say executives and staffing professionals. Business acumen is now on par with possessing stellar technical skills, with in-demand employees those who can contribute more than code to the company.
Philips, the Dutch multinational company that makes products for the lighting, consumer electronic and health care markets, is connecting business and IT as part of a larger project aimed at boosting its stock price by reducing overhead and making the company more competitive. Mercy, a St. Louis-based medical care provider, wanted a business-savvy CIO to help the firm develop IT services it can sell in an increasingly digital health-care space. And at BoxTone, a startup focusing on enterprise mobile device management, IT workers are welcomed to submit thoughts on how to improve a product.
Overall, executives are more cautious about IT spending as businesses recover from the recession, says Jack Cullen, president of IT staffing services provider Modis.
Prior to the fiscal downturn, controlling IT spending, which can be expensive, wasn’t emphasized, he says.
“From your infrastructure to your applications to portable devices, there’s a lot of cost tied into it,” Cullen says. “Back in the day when everybody was spending to outdo each other there wasn’t as much concern about the cost.” Now, “everything is about ROI,” he says.
Regardless of industry, the most-sought-after candidates are not only well versed in popular technologies, but understand how their jobs are tied to better products and services, happier customers and, ultimately, the bottom line.
IT workers who fail to see how technology can boost sales or improve a product may find themselves passed over for career opportunities.
“We can send in an extremely technical individual, but if they don’t have that ability to be a great listener to the business problem, they’re not desired,” Cullen say.
Such is the case at BoxTone. The Columbia, Maryland, company asks potential employees during the interview process if they’re interested in learning the business, says CEO Alan Snyder. Applicants who react negatively to the question aren’t hired.
“You must understand the business to drive it forward,” he says. “I want somebody that acts and functions as an owner and has a stake and ownership in the business and our customers.”
To give employees that ownership stake all workers are encouraged to share product ideas that are in the customer’s best interest since satisfied users ultimately benefit the company, Snyder says.
“A lot of time some of our best ideas legitimately come from our IT group,” he says. “They’re working on the product everyday. They might see the missing pieces faster because in many cases they’re walking the same road that our customers are walking.”
A startup’s culture may lend itself to employees working in multiple roles, but organizations of any size can replicate this environment, Snyder says.
“It comes down to creating an environment that says you are an important part of the team and we want you to be successful there by making the company successful,” he says. “At an organization of any size that should be the goal.”
Creating that environment requires giving employees authority to suggest ideas and management taking those suggestions seriously, he says.
“That is hard for a lot of organizations. It comes down to culture.”
At Philips, which has IT operations in more than 600 locations in 60 countries, a revamp of its business processes is leading to a culture where IT and business work in synch.
Having IT more in tune with the business is part of a multiyear project that aims to streamline the steps that Philips uses to bring products and services to market and improve its performance on Wall Street. A more flexible company, and IT department, can give Philips market insight not found by using enterprise software, says Deputy CIO Joe Norton.
“We’re all buying from Oracle, from SAP, from Microsoft,” he says. “What’s the competitive advantage? There is none. The competitive advantage is all about information acquisition.”
Obtaining and using that information to develop the right products for when markets need them is the future of Philips and its IT department, Norton says.
To develop its future IT platforms, Philips is using agile software development, a key component of which is working in interdepartmental teams. To help employees understand how agile software development would connect business and IT, all Philips workers received training in agile methodologies, Norton says.
Additionally, Philips uses webcasts, workshops, newsletters and panel discussions to explain the company’s focus and how departments are interconnected.
“You have to look at this as a massive organization change,” Norton says. “It’s just not for IT. It’s more the entire company. We’re not doing this alone.”
For companies that aren’t following an agile development path, Modis’ Cullen recommends a similar form of collaboration with representatives from IT and business attending their respective department’s strategic meetings.
“By having that cross pollination you’re developing a cohesive business unit,” he says. This avoids the departmental rift that develops when IT is eager to use the latest technology without considering if it solves the business’ problems, he adds.
Having IT workers versed in the company’s business is crucial for Philips’ future IT leaders, who will not come strictly from the ranks of software developers or database administrators.
“They’re going to be business technologists who review how we go to the marketplace,” Norton says. These employees will understand how IT can facilitate getting products to market across all levels of the company, as well as work with suppliers.
IT departments are smart to place the business’ needs first given that most CIOs report to the CEO or COO, Cullen says.
“If you look at where technology is in the pecking order it’s very wise that people have the mindset that we can’t lead with technology,” he says. “We have to lead with the understanding of the business issue, provide a business solution and show how IT can enable that.”
Mercy, whose 32 hospitals treat more than 3 million patients annually, hired Gil Hoffman as CIO in October to better align the organization’s IT with its business needs.
“When they recruited me, there was a real interest in trying to get more business knowledge instead of just technology knowledge into the IT organization,” says Hoffman, who previously handled that task as the CIO of a marketing services company.
Mercy views its IT department as a potential source of revenue as it looks to sell its IT services to other medical care providers, Hoffman says.
IT still retains its role as an internal service organization, but is now more proactive and discusses how technology can remove work obstacles.
Desktop upgrade conversations—a “so what” talk with workers asking how this benefited them, Hoffman says—have been replaced with discussions about a mobile plan that will lead to greater productive and user satisfaction.
“We’re much less focused on the technology but more focused on what kinds of problems are we trying to solve,” he says. “Those types of discussions have been more productive because the business seems to relate to IT more.”
With IT more business focused, tech staff are aware about what departments expect from technology and what vendors they’re considering to meet those needs. This allows IT to be involved at the start of these conversations and possibly save money.
“As the business gets enamored with some vendor very often they make decisions before they’ve done any due diligence on if we already have a product or service like that or is there another more cost-effective solution,” Hoffman says.