New CIOs: Why it’s Important Not to Treat Your Honeymoon Like a Honeymoon - How to Make Your First 100 Days Count

By Tim Gallagher and Bruce Myers
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Ah, the honeymoon: that brief period - say 100 days - when a new executive’s
constituents (e.g., bosses, customers, peers, et al.) are optimistic, patient
and forgiving. As a new CIO, you might think your first 100 days are a perfect
time to get your bearings, take it slow, avoid mistakes and begin to set your
agenda.
Well, think again!
Today, the average tenure of a CIO is less than two years. If you go into your
new CIO position with this old paradigm, chances are you’ll wind up divorced
from your company before the honeymoon is over. Don’t think “Niagara Falls,”
think “hit the ground running.” What’s the best approach to doing that? Treat
your first 100 days, not as a honeymoon, but as a turnaround. Use the
first 100 days to act with a sense of resolve, even urgency. Based on more than
a quarter century of experience working with companies and IT organizations in
both turnaround and healthy situations, including performing interim CIO roles,
here are a few tips for making sure your first 100 days are a running start
rather than a slow break-in period.
Dig Up the Landmines
Nothing takes the bloom off the rose like being blindsided by a crisis. It would
be a mistake to assume that those who interviewed you knew all the details of
the goings-on within IT. You can count on there being issues that will require
your immediate attention. The challenge is to uncover those landmines as quickly
as possible.
| Example: On his second day on the job, the new CIO at a specialty jewelry maker
discovered that the fall selling season was about to start and that a major
system upgrade scheduled for the weekend was going to fail. The system had not
been tested and did not work, but was being put into production to meet the
go-live date imposed by corporate executives. The entire fall selling season,
and the entire year’s profitability, was in jeopardy.
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Use your first week as an opportunity to meet with as many of your IT staff as
possible. Ask them where the landmines are and get their suggested solutions.
This is your first and best opportunity to demonstrate that you value people who
surface problems and propose solutions, setting the right leadership tone for
your entire tenure. In these discussions, also determine the state of IT
security and of Sarbanes-Oxley compliance—issues that will be your undoing if
not handled properly. Listen to all the input you get, and take swift action to
disarm the landmines.
Conduct a Rapid IT and Business Review
With any immediate crises hopefully avoided, meet with each of your direct
reports, one-on-one, for more in-depth reviews of their operations. Get their
views of the key business and IT issues, the major complaints they hear, and the
major improvements they believe IT can make in the operations. Ask for any ideas
they have for improving the organization’s IT effectiveness and efficiency. If
possible, have these meetings in their offices and include a quick walking tour
of their areas, meeting some of the staff. This “mingling with the troops” will
go a long way toward building a motivated extended team. You probably won’t be
able to absorb more than a few hours worth of detail from each of your direct
reports on this first pass, so limit it to that. Then, meet with as many of
their direct reports as you can, again one-on-one, to get the same type of
information.
Now you are ready to survey your key business customers. Rather than looking at
it as a “survey,” look at it as a critically important opportunity to
demonstrate to this very important constituent group that you “get it.” Get its
views regarding the IT department’s performance to date, asking about both
strengths and weaknesses. Come prepared to listen, but also to offer up some new
ideas regarding IT usage in their areas.
| Example: The new CIO at an industrial products manufacturer came from a consumer
products background. He introduced several customer profitability measurement
ideas that IT could put in place relatively quickly to support key customer
rationalization decisions. While the concepts weren’t new from a consumer
products industry standpoint, they were new for this industrial products
company, and helped the new CIO gain instant credibility as a business peer with
the executive team. |
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Along the way, begin to build the kind of personal rapport that will, among
other things, allow you to uncover the “unofficial” organizational structures
(and power bases) in the company. Have these conversations with senior
leadership and you will begin to formulate your overall IT strategy as you get a
sense of what is truly important to the business.
Finally, go back and meet with your own staff as a group, and share with it
what you’ve learned from your discussions with its IT customers. Conduct
several sessions, and encourage open and frank discussions to get all the issues
on the table. If your situation is like most we’ve seen, the truth will be
somewhere between senior leadership's most pessimistic view and the IT
executive’s most optimistic view. You can use these sessions to help drive a
consensus among your leadership team regarding the major areas of concentration
and investment for IT going forward. These discussions will also help you
identify the strongest players in your organization, and solidify your thinking
regarding your overall IT strategic direction.
Overcommunicate
Having had all these conversations and taking the first step toward establishing
relationships (formal and informal), maintaining regular communication is a
must; this starts in your first week and continues for as long as you are in the
position.
Communicating is a tactic for—
- Informing your stakeholders of progress, obstacles, and mistakes and plans to
correct them.
- Managing expectations around actions and timing.
- Giving credit to IT team members as well as others in the organization.
- Ensuring the appropriate level of visibility, especially during those periods
when things are going on but there is no outward sign of progress.
Think of communications broadly: the well-timed e-mail or voice-mail; a
handwritten note on a progress report passed on to a business customer; and town hall meetings, conference calls and webcasts. While this is common
sense, it can never be done enough.
Take a Triage Approach to IT Projects
As in a true turnaround situation, the successful new CIO today takes a triage
approach to evaluating all current IT projects: rapidly determining which
projects should be saved (or even accelerated) and which should be left on the
stretcher. The good news: you already have a sense of the “worst cases” from
interviews with the senior leadership and your staff.
| Example: The new IT executive for a large wholesale distributor found that his
applications development group was spending all its time on small maintenance
projects. Individuals in the company were able to call the developers and get
work done with virtually no approval or prioritization. He immediately
instituted a process to capture and incorporate all requests into a master list.
He established simple procedures to manage the list and brought the appropriate
business executives together to establish priorities. Even they were unaware of
the demand being placed on the IT organization by this series of small,
non-strategic requests. This new discipline focused development resources on
high-impact projects that were in line with senior leadership's direction. |
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Strengthen the IT Team Take an unemotional look at your IT staff; human resources is an area that is
often an opportunity in disguise. It is human nature to avoid terminating
marginal and even poor performers, but it will never be easier than when it is
part of your top-to-bottom evaluation. Work with your direct reports in the
process of rating everyone in the IT organization to identify marginal
performers. By removing poor performers, you will gain instant credibility
because the top performers know who the poor performers are; they have been
wondering why management hasn’t dealt with the issue.
| Example: The new CIO for a global automotive supplier inherited an organization
that was bloated with marginal performers whose skills were out-of-date. He
immediately implemented a performance and skills review program that, over a 15-month period, reduced the IT organization headcount from 700 to 500. In the
process, roughly one-third of the 500 remaining people were replaced. While the
entire process took 15 months, the foundation was set during the first 100 days.
The resulting organization had better performance and higher morale once the
“dead wood” was removed. |
Not every organization requires a realignment of this magnitude, but if you
approach staffing objectively and with your strategic plan in mind, you will
build a stronger organization in the long run.
After evaluating your staff, look at your overall organizational structure for
changes that can improve effectiveness and efficiency. Again, consult your
direct reports and key stakeholders regarding any reorganization ideas and be
prepared to defend your logic to those who would protect organizational sacred
cows.
| Example: Take the case of the newly hired CIO of a
national construction company brought in to establish a new IT strategic direction. He was the third
CIO in three years, the previous two having been dismissed for non-performance.
What he found were two separate factions in his organization that refused to
work together after a major corporate merger three years before. Many of his
direct reports were being protected by company executives; service was spotty
and based on “who knew whom” within IT; and different legacy technologies were
competing with each other.
The new CIO knew he had a very short time to correct these problems before he
became the latest CIO casualty. He redesigned the IT organization along
functional lines, consolidating the duplicate support and development groups
into centers of excellence, and deliberately mixed personnel from the two legacy
organizations. Working with each of these new organizational units, he
established specific goals and metrics that reconnected them with the business
and streamlined their internal processes to lower costs. The new structure
enabled the CIO to eliminate the inward-looking IT focus and to shift the
organization’s view to longer-term goals (those for which he came to the company
in the first place to accomplish), developing a truly innovative IT strategy.
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| | Attack Your Budget
Be completely unemotional about your budget. Review each budget line
item in the first month of your tenure to gain an understanding of the actual-versus-budget status and the causes of variances. In acute situations, you might
need to take a “life-over-limb” approach; if you don’t need it to survive, it’s
gone. In less acute situations, you should still evaluate all costs for ways to
“beat the budget.” Even if IT costs are not an immediate concern in your
company, now is the time to establish yourself as someone with a hard eye for
the numbers. Proactively reach out to your stakeholders, especially those who
are not satisfied with IT’s performance to discuss the baseline costs coupled
with ideas to improve service. On the other hand, don’t forget to identify areas
of potential under spending on IT. Set expectations early with your stakeholders
about spending increases that may have to be made.
Establish IT Metrics and Participatory IT Governance
With a baseline established for projects, budgets, staff and organization, you
now need to agree on performance metrics with your key stakeholders and set up a
process to track actual performance. You may find some metrics and measurement
processes already in place, but don’t expect it.
| Example: An effective approach was used by the new CIO at a specialty chemical
company who set up two two-hour sessions with key business executives. In
preparation for the first session, he put together a straw-model IT scorecard
that described three to five key metrics each in three overall categories: cost,
service and people. He used the first session to discuss the straw model and to
get input from the senior leaders regarding the measures they felt would
best help them monitor IT effectiveness and efficiency. Based on the output from
that session, he revised the straw model to reflect the recommended metrics and
measurement process, which was finalized and formally adopted in the second
session. This approach is a great way to get the business to buy in to the
specific metrics that it will use to measure the IT organization.
| A similar process can be used to set up the formal IT governance process.
Involve senior leadership in designing the governance process for items
that require business input and participation, such as the process for
requesting IT services, setting IT priorities and developing the IT discretionary
budget (i.e. that part of the budget that is above keeping the systems running).
Use facilitated design sessions such as the ones described earlier to gain
business input and agreement regarding those governance processes.
This type of approach to IT metrics and governance will help you build
credibility and buy-in from the business, and will help improve the stability
and predictability of IT services that should reassure your key stakeholders.
Establish a Strategic IT Direction While you don’t need to have a new, full-blown IT strategy within your first 100
days, you should have established your major strategic initiatives and have the
support of key business executives for your direction. Then you can flesh out
the entire IT strategy during the following months.
The best way to achieve this is to have your staff pull together all the IT
strategy documents from the past three to five years.
| Example: The CIO for an industrial conglomerate went
through this. His staff summarized the
major alternatives and components from these documents together with the key
findings from his early business and IT interviews. He then developed a two-day
strategic IT workshop where he had both his key IT leaders and the key senior
leaders come together to review and discuss a straw-model strategy that his team
had created. Through a series of breakout discussions they developed a consensus
regarding the key IT initiatives that were required to support the business
direction over the next two to three years.
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| | Using this “quick and dirty” approach to establish your strategic IT direction
during your first 100 days will help you set the direction for your organization; continue to build your credibility with the other corporate executives; and
position you for success during your entire tenure as CIO.
So, as a new CIO, how will you spend your honeymoon: breaking in or breaking
out? Will it involve breaking the IT department out of its mold, breaking
outdated IT paradigms or breaking down old ways of doing business? Acting as if
your first 100 days is a turnaround, rather than merely a turnover, will indeed
increase the chances of your honeymoon leading to a long, happy marriage.
About the Authors Bruce Myers is a managing director, and Tim Gallagher is a director with
AlixPartners LLP, a global performance improvement, restructuring and financial
advisory firm. Bruce works out of the Chicago office and can be reached at
bmyers@alixpartners.com. Tim works out of the New York office and can be reached
at tgallagher@alixpartners.com.
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