Leadership

How to make your CEO a massive tech advocate, guaranteed!

CIOs are tasked with promoting a vision and strategy for IT. But CEOs, when you can get theikr ear, aren't really interested in technology. Marc Schiller talks about what you can do to solve this dilemma.

Problem: Building a relationship with the CEO ain't easy.

IT leaders know that building a relationship with the CEO is important in order to:

  • Effectively promote a vision and strategy for IT
  • Advocate on behalf of the IT group and its interests
  • Build personal reputation and influence

At the same time, IT leaders face two major challenges in this regard:

  1. Most CEOs don't really care all that much about technology
  2. Getting face time with the CEO is difficult

It's a tough problem

What makes this such a tough problem is that the very core issues that are so important to you as the IT leader are simply not that critical to the CEO. For most companies, IT represents less than 5% of the budget. It's just not that important financially -- except, of course, when there are problems and systems aren't running correctly, then the CEO is all over you. And that's the worst time to try and build a relationship.

The conventional approach

To address this problem, IT leaders invest (rightfully so, I might add) a great deal of time framing technology issues in business terms and advancing theirs with special-purpose presentations. (See "Three Presentations Every Influential CIO Must Have at the Ready.")

Clearly, I am a big believer in this approach, and it can yield wonderful results. However, I often find that even with the very best IT vision presentation, the IT leader struggles to get an audience with the CEO. Breaking through that structural apathy so many CEOs have to technology can be very hard.

An even better way

Thanks to the results of a recently published study (I'll get to it in a minute) there is now a whole new and much more powerful way to connect with the CEO of your company and to get him massively interested in technology at the same time.

Sound too good to be true? Hold your judgment for just a few minutes more and check this out.

We all know that the absolute best way to connect with any person is to focus your interactions with him on the issues that are most important to him. When you are talking about and working on things that are very important to the other person, he has a lot of time and interest in building a relationship with you. It's basic. The problem is that the CEO doesn't feel that way about technology. But what if you could have the following water-cooler conversation with your CEO (we'll call him Jim)? Do you think this would get his attention?

"Jim, I know you're interested in our company's reputation and our financial performance, which is why I want to come speak with you about some important industry data that has recently come out.

It turns out a company's reputation, financial performance, and even CEO pay can all be directly linked to how the company approaches certain kinds of IT investment.

What I think we can learn from the study are some really easy, no-cost or very low-cost things we could do immediately to start getting these benefits.

When should I make an appointment to see you?"

At this point, you have his undivided attention. I'd be shocked if he didn't say something like: "Actually, I've got a few minutes right now. Let's go for a short walk."

What the research shows

Before I tell you how to have the follow-up conversation with the CEO, let's take a look at the research and what it tells us.

In his study entitled "The Surprising Impact of Fashions in Information Technology," Professor Ping Wang of the University of Maryland and his team identified the business impacts associated with the method and manner of adopting different types of technologies. In particular, they were able to demonstrate a very strong correlation between the adoption of "hip" or "fashionable" technologies and key business indicators. In other words, they found that companies that approached "hip" or "fashionable" IT in a particular manner enjoyed important business benefits.

And while there were many aspects to their findings, I am going to focus on the key findings that serve our purpose as stated above: Building a relationship with the CEO.

Here are their findings in a nutshell:

Finding #1: Being associated with in-fashion IT correlated with an increase in the company's reputation.

The more often a company's name appeared in articles that also mentioned an IT innovation that was considered in-fashion at the time of mention, the higher the reputation score that company had in the subsequent year's list of America's Most Admired Companies. More specifically, for each 1% increase in the company-technology associations, a reputation score increase of 0.52% was reported.

If that's not interesting enough, the reputation bumps occurred whether or not the company actually followed through with an investment in the technology discussed.

Finding #2: Actually investing in hip IT further increased reputation AND was linked to improvements in bottom-line performance.

When a company actually invested in fashionable IT, their reputation scores increased even more substantially. Every $1 million investment was associated with a bump of 0.66 points in a company's reputation score (measured from 1 to 10) the following year.

Additionally, the companies that actually made investments in fashionable IT experienced better bottom-line performance by the third year, as measured by the sum of the company's return on assets, equity, and sales.

Finding #3: CEO compensation went up in proportion to the size of the "hip" IT investment.

That's right, you read that correctly.

A company's association with hip IT correlated to an increase in the CEO's pay. For every $1 million a company invested in fashionable tech, the CEO received a $45,000 bump in compensation, on average, the following year -- REGARDLESS of how the company actually performed.

Are you still sitting down?

If you are anything like me, I could scarcely believe this. But it's true. And the research is rock solid. Backed up by public source available data from 1971 to 2002.

Hopefully, by now you are starting to take me seriously about a whole new and powerful way to capture the attention of your CEO. But you're probably wondering: What exactly do I do with this information? How do I present it to my CEO? What's in it for me?

I'll cover that in next week's post.

14 comments
vasanthkumar.raju
vasanthkumar.raju

Marc, according to social research just because A and B happen together doesnt mean that A leads to B. It's likely both Hip IT investments and bottom-line performance are a result of the company's innovative work culture or other important factors. And most CEOs would understand this basic principle. So I fail to believe that they would buy into this argument.

rick
rick

I will agree that many CEO's are unresponsive to IT and see it as a another necessary administrative expense there are still many who are more open-minded. C level execs want to talk about their businesses whether to employees or vendors. If you can legitimately demonstrate practices or innovations that will resolve pain points, better the business and mesh with the corporate strategy you can be successful.

ScottCarmichael
ScottCarmichael

Don't want to be a negative nancy here...but there's a reason why 99.9% CEOs/Owners don't like tech people or tech-anything...they hate the idea that someone else is potentially smarter than them. So despite them needing IT people or resources in order for their company to operate, the truth is they really dislike having to employ people who most likely know they are full of crap when they try to report earnings, talk to employees about the company status, determine costs, etc. As a result, instead of admitting, "Hey, IT's my not my strong suit" and hiring effective IT workers/management and allocating resources to IT stuff, they instead just outright ignore it. There's no "talking" a CEO/Owner into anything. Especially if you're just a peon already employed by the company. Now if you're an outside vendor or business that has close ties with the owner's, you may have luck getting him to buy your IT advice, goods & services...but there's something about IT people being treated like idiots...even though they probably know more about what the business needs to operate day to day than the bosses!

alistair.k
alistair.k

I agree, there is a flawed observational approach here. I hate to use the word "holistic" but if you want your company to be seen as leading edge you need more than a Facebook fan page or dishing out iPads to some execs. Slapping some random attributes of a successful, innovative company onto some old donkey of a business will not transform it. The fault is not the data but the interpretation of it. For example a good friend of mine always claimed that global warming was caused by the decline of pirates. If you plot piracy on the high seas against global mean temperatures you will see that as piracy declines, so global warming increases. In order to combat climate change we need to get more pirates out there. This seems to be someone pulling the same stunt, but without it being a joke.

gechurch
gechurch

I was thinking the same thing whilst reading this "revolutionary new research". It's so obvious that A doesn't imply B - I can't believe someone wrote an entire article advocating this. Look at the school yard - all the cool kids have ipods these days. Does that mean if geeky/unpopular Jimmy goes out and buys an ipod he will suddenly be considered cool? Of course not. This whole article reminds me of paid adverts I see on supposedly legitimate current affairs programs. "You'll be amamzed", "Guaranteed". Bleh. This is well below the standard of article I have come to expect from TechRepublic. -0.66 reputation points in my eyes.

hauskins
hauskins

Executive officers tend to be older and probably in many cases are not connected to "hip" IT- which I assume is facebook, twitter, social networks in general, along with gmail and online software tools. If they are not users of such things they don't tend to care, but make them aware that it would really improve the image of the company and increase the bottom line, and they would probably be all ears. In the university setting it is just as true, but what we are trying to attract is better caliber students and they way that is done as far as IT goes is to have those "hip" IT things that "digital natives" want. Our executive officers tend to fit the not interested category because they don't use or are not interested in the "hip" tech just what works, but on the downside we have a large student body that sometimes feels that the "U" is behind the times.

HAL 9000
HAL 9000

Shouldn't that read Lets go for a long walk now on a short Pier? The best way to deal with Owners/CEO is not to try to talk them into anything. Just be there with the solutions when the need arises. ;) Col

joe_software1
joe_software1

It's not uncommon to find poor ROI results for IT initiatives that were pitched as technologically promising. This has an impact on the attitude of executives in viewing whether IT is an enabler of the business. Budgets are tight and I expect to see even higher demand from IT to convince Executives of value. This only results in a "deer in the headlights" look from IT managers that already don't have enough budget to even do the basics. What you speak of is an organizational management issue and has really nothing to do with technology.

handyman1972
handyman1972

I think the author makes his most valid point in saying that the best way to approach a CEO (or anyone for that matter) with an IT-related scenario is to find a way to couch that scenario within their own concerns. This can be said of many things, and is just as true in those situations. A simple example: I couldn't get a budget of $2500 approved for 5 new PCs in the accounting department. "We don't have the money right now" is all I ever heard, which was somewhat legitimate as the CEO and CFO were struggling with cash flow and budget issues at the time. The PCs were old, slow, and prone to frequent issues, which took me away from other tasks. I couldn't sell the budget from the standpoint of the value of my own time that would be saved, as I was on salary and any additional hours required of me carried no weight or value to the CEO. However, I asked him to accompany me to the accounting department one day and asked him to simply stand there and just watch the employees work. Within 10 minutes he realized (as I already had) that all of those employees spent a significant amount of their time sitting on their thumbs waiting for their old PCs to catch up with them. I explained that new PCs would allow things to get done much faster and with a reduced staff (we had a bad apple that nobody got along with that needed to move on anyway). Couched in those terms, he immediately perceived value in my proposal, the budget was approved, and the ROI was realized in about a month. Interestingly, when he made the decision a year later to start another company, he immediately pulled me in to the process, asked me to research all the tech needs to get things going, and didn't once questions my list of needs. My proposed budget was signed off on immediately without any compromise required. Sometimes if you can validate and prove yourself and your ideas just once, relations with the top brass become immensely easier from that point forward.

rkendsley
rkendsley

It's bad for your U's reputation and ultimately bad for your business. The more of your user base or potential user base that is using technology the more tech they will also require from your business. I would say you need to stay current, especially at the university level. Of course you know that, now you need to communicate that to the top guy. Pilot projects? Surveys regarding the "success and acceptance" of the pilot projects? Analysis of the "caliber" of students you are attracting 1 year out, 2 years out, etc.

emad
emad

You are 100% right, I totally agree with you. The moment you earn the top management trust you are taken for granted.