Leadership

Why taking a few punches on the financial crisis just might save IT

Patrick Gray believes that IT leaders still looking to find a seat at the C-level table might gain that influential position by taking a share of the responsibility for the failures that led to financial crisis.

With financial markets ever so slowly rising, and pundits predicting a flicker of light at the end of the tunnel, many seem to be breathing a cautious sigh of relief and happily putting talk of the financial crisis behind them. For CIOs, this may be precisely the wrong approach.

For years CIOs have pitched IT as far more than a shared service. Instead of just keeping the technical lights on and the servers humming, IT has made a case that it can be a key player in helping monitor and execute corporate strategy. This is the "holy grail" of IT, and fulfillment of those mercurial concepts like "alignment" and "sitting at the executive table" that we have been pitching to our colleagues in the C-suite for decades.

While it seems anathema to any leader's innate sense of self-preservation, taking some level of culpability for the financial crisis just might be your ticket to gaining that seat at the table that has remained elusive for most CIOs for so long.

Information Technology is presumably about information as much or more than it is about technology. While we can spend hours debating the sources and precise causes of the financial crisis, and no one suggests IT could have completely avoided the crisis and its fallout, there are likely areas where IT could have provided information that might have saved some money and some heartache.

We frequently claim an ability to provide analysis and commentary on the reams of data we manipulate when pitching a new business intelligence system or guidance on how that data might be leveraged toward better decision making, yet when asked about anything that IT might have done to avoid the financial crisis, many people I've spoken to suggest IT is here to manipulate the technology, not provide guidance, strategy or insight towards its use.

I am certainly not advocating that CIOs and the IT industry be subjected to the public flogging that bank CEOs and marquee brands have been submitted to. We certainly do not need any more images of browbeaten captains of industry retreating from meetings with politicians, hats in hand and browbeaten expressions across their faces. Rather, a casual conversation with your CFO or CEO suggesting IT might have made some errors in its focus as the financial crisis took root would be an appropriate tact. Suggest that IT might have provided enhanced information and analysis capabilities, or implemented more aggressive risk monitoring and see where the discussion goes.

Taking some measure of responsibility for a misdirection of corporate strategy that has impacted your company and millions of people will do far more for the mercurial concept of "alignment" in fifteen minutes than years of lip service coupled with retreating to a corner and quipping, "Hey, I just provide the tools" whenever the company makes a strategic error.

About

Patrick Gray works for a global Fortune 500 consulting and IT services company and is the author of Breakthrough IT: Supercharging Organizational Value through Technology as well as the companion e-book The Breakthrough CIO's Companion. He has spent ...

16 comments
dcolbert
dcolbert

Does "sitting at the 'C' level mean throwing around corporate buzzwords and bable-talk? Listen, the C-level got us into this mess, not IT. You've outsourced all of your well paid knowledge workers to offshore IT sweatshops because you projected that Europe and Asia would be your biggest growth markets in 2010 - never realizing that you were going to have a huge growth market on low profit margin items, while decimating your high-profit domestic markets (because you laid all of your domestic workers off, and now they can't afford your high margin products). And when you couldn't outsource, you imported H1B visa workers by the boatload, again laying off domestic workers to make room, all the time going in front of the press and saying, "we can't find enough domestic workers skilled in math and the sciences". The guy on the street may have bought your story. But 800,000 out of work domestic IT workers could smell the stink of your lie a mile away. The C-level saw the profits tomorrow, and happy share-holders, and lost sight of where the economy would be 5, 10 years down the road. "Heck, I'll be retired and on an island in the Carribean by then"... right? Right? Wrong. Don't try to blame US for your reprehensible foresight. It doesn't take an MBA to see who caused this mess, and it certainly isn't us. Shame on you for EVEN trying to imply that we should take any of the burden off of your shoulders for this. The C-Level is who got us IN this mess - and it is clear they have no idea how to get us out. Oh, and what sweet irony that your low-margin European and Asian market are suing you to high heaven for anti-trust violations? Something your domestic governments have overlooked for 30 years. Welcome to your new world order. Enjoy making a living on netbooks and cell-phones. Don't come crying to me, I'll be mowing lawns to try and make the rent on my double-wide.

BFilmFan
BFilmFan

The only good thing about this economic downturn is the growing number of people asking questions of business leaders. If the managers and captains of industry are so smart, how could they fail to see this potential severe downturn? The real truth is that most middle and upper management have excellent skills at writing reports and presenting them; but, lack a solid background in any education outside the courses taught in the MBA programs. Let's be really ugly in the future and require all management and captains of industry to post their grades up on their office doors. Shouldn't we all know that the head of finance or IT that determines the futures of companies and employees was a low-C level student? I'm willing to post my college grades up; but, I know most management and consultants would rather be eaten alive by fire ants than admit they barely graduated from college.

Tony Hopkinson
Tony Hopkinson

would have become IT tech's and earnt real money. :D LMAO.

santeewelding
santeewelding

A double-wide? A lawn? A mower, even? Keep it up. I likes how rich folk talk. ed: couldn't resist

dcolbert
dcolbert

It should be refreshing to hear an honest observation from someone who lives in a 4000 sq. foot home with a few luxury automobiles in the garage. :) Of course, I'm far closer in income and lifestyle to the average blue-collar Joe than to the guys we're talking about here, generally speaking. But I also have enough foresight to see that when the middle-class disappears and the lower-class swells while the upper-class becomes an elite minority living a lifestyle the lower-class cannot imagine... The upper-class tend to find their heads removed from their bodies and stuck on the end of poles outside of their mansions. I'm sure the French aristocracy never thought the peasant class would upset their social order, either. I think the wealthy elite are being short-sighted in matters far more important than just how outsourcing will affect the bottom line of the companies they run over the next 10-20 years. Re ed: Fair shot. I do have a riding mower, but I let the guy across the street have it. And I *do* own a travel trailer. That is kinda like a double-wide. :)

mta0907
mta0907

How many companies are looking for ways to oursource their IT and with the growing trends in Cloud computing, there is even more reason for them to do so. It saves them money and most importantly, it is not their core competency. Offloading IT enables them to be able to devote more resouces to what is their core competency, their business mission and goals. Decision makers and business analysts need to be IT aware and aware of the kinds of data that is available for conducting research and analysis but this is NOT the IT department. Next thing you know, a CEO will be sueing Google for not warning them of impending bad business decisions based on analysis being performed against customer data being maintained in the cloud.

reisen55
reisen55

Heaven forbid? All American management sees of the information technology people is that they are a cursed expense - high salaries and benefits when we do is "run the servers" and nothing else. What else do we do? So, in a financial crisis cut THOSE COSTS and hire those ever eager and so willing people from Bangalore to do work for 1/4 salary and no health care benefits. Great reason for IT to be outsourced MORE if you ask me and further decimate our career field. And of course those salary dollars spent in Bangalore just always return HERE to this country to buy hard goods and services don't they???

Tony Hopkinson
Tony Hopkinson

some good, in places where butt kissing get's you ahead, it won't do IT any good at all. That would pre-suppose that now at the big table as a demonstrated sychophant and arse sniffer of the first water, these perrenial failures will suddenly start to make a difference....

scott.mcpherson
scott.mcpherson

We can also take responsibility for the Hindenburg, Pearl Harbor and Krakatoa. It makes about as much sense as this blog.

mike_patburgess
mike_patburgess

When you are at the CIO level, you are the decision maker not the person on the floor. You are paid to make those decisions and to pay the supreme sacrifice when they are wrong. Take it on the chin C-level person because you are the first and last line during this crisis time.

tags
tags

Most IT people do not look at the production data to analyze it. Production support, maybe. So, you expect production support to tell the CIO? I realize that when IT is asked to make a change to the software - maybe be a little lax on the rules - the software analysts might be able to predict that that might be a problem someday. But, how do they know that it will effect the economy or create a backlash? They are not economists. They are software analysts.

mikem
mikem

As an IT officer at a financial institution, Patrick, your article has put solid words to the concept I?ve been chasing. In a small financial institution, I have the benefit of never being able to take a myopic view of my responsibilities, and the opportunity to see how everyone in the organization uses technology. One good example of this for us is that a model for measuring profitability is absent. The Chief Lender and Chief Financial officer have made a failed attempt to put numbers together and have backed off. They instead continue to rely on their experience (gut) as the foundation for their judgment when making decisions regarding potential profitability. Fortunately for me the CEO still wants to measure ?profitability,? but when pressed, isn?t sure how or where to do it. It has become apparent to me that I can no longer take the attitude that ?I?m just the network guy,? when I see such an ongoing failure to leverage, or even to understand how to leverage the information that surrounds us. I have to play a role in ?forcing? the C level executives to face accountability for their lending and spending decisions. I believe their instincts are an important part of the equation, but that they have to be tempered by measured results, as well as predictive analytics. This is what INFORMATION technology should do. It is where we can help. It IS my responsibility to help them see where there decisions are going wrong, so that they can apply their knowledge to do better. It?s just a beginning, but that is why I agree with Patrick that IT needs to TAKE more responsibility if we want a C-level seat at the decision making table.

Peter Thomas
Peter Thomas

But then I guess you might have expected me to say that! Peter

john.a.camarillo
john.a.camarillo

IT is black and white. The financial crisis issue was not about computers, networks, data or facts. It was about greed and a lack of honoring the code of conduct, code of ethics that were published by each of these companies who benefitted from the Gov. support. These banks/companies all knew what they were doing and decided to ignore their responsibilities to their employees, shareholders and customers. No matter how much data could have been presented - someone ultimately had to say this was wrong.

nick
nick

I think that Patrick makes some good points. I might not approach things in his manner but the sentiments are very good. We in IT if we want to be there for the long haul, or sitting at the C table, need to be more than fair weather sailors. It is a matter of responsibility, you have to take the good with the bad and stepping up to take some of the bad now can certainly stand you in good stead. A decent CEO will actually tell you it isn't your fault but he or she will remember your actions next time you make your pitch to be at the C table. Disappointed with some of the other comments such as those in 5 and 6 below, but I think that probably represents the size of their IT or the environment they are working in.