Last spring, Scott Heintzeman, CIO of Carlson Marketing, was developing new business intelligence systems. The project would support Carlson’s marketing business unit, which helps clients mine their customer data to create individualised direct-marketing materials.

Carlson executives expected the business unit – a new line within the company – to be one of its top performers. Heintzeman knew he had to deliver but he could not do it on his own. Heintzeman was not worried about the technology needed to support the unit. He was more concerned that the business unit lacked a strong leader – someone aggressive enough to establish business processes and rack up some quick wins, while personable enough to help employees through the inherent stress and uncertainty of a new venture.

The right person

Heintzeman believed he knew someone who was right for the job: Janet Sparkman, the general manager of Carlson’s Gold Points Reward Network, a customer loyalty programme that is one of Carlson’s core businesses. Since he had worked well with Sparkman previously, he asked her to consider a job change. She flatly declined. So Heintzeman went to work, lining up support for his plan among other business leaders and assembling a dream team within IT to support Sparkman. He knew she was attracted to new ventures. “But Janet isn’t going to join something that she cannot win,” says Heintzeman. “No way would she make that change if she did not have the right IT team to support her.”

Heintzeman’s attempt to influence a strategic business issue is familiar to any executive but particularly challenging for CIOs, who have little formal power, observes Susan Cramm, a former CIO of Taco Bell and now an executive coach. Often, a CIO’s impact comes down to how good he is at convincing business leaders and end users – who do not have to listen – to follow a strategy that the CIO deems important. “The ability to ‘lead from the back’ becomes essential for success,” says Cramm. “Without influencing skills, CIOs are relegated to being order takers.” To have influence, it is not enough to be able to explain IT in an understandable way. To sway opinions and persuade others to act, CIOs need expert knowledge of their subject and its relationship to the business; the ability to adapt their message to their audience; access to allies who will support their goal; and the ability to vet ideas in a non-threatening way.

CIOs who employ these and other techniques can influence the strategic direction of their companies. Influence is directed toward a variety of goals and these may include redirecting an outsourcing strategy, persuading a senior executive to make a major IT investment and selling new technology to sceptical end users. Having influence requires developing relationships that are based on trust so that CIOs gain allies inside and outside the IT department to vouch for them. “CIOs need to make sure they are investing in relationships all the time, because one day you will have to take a withdrawal,” Cramm says.
“If you wait until something happens that requires you to rely on someone and you don’t have any capital to draw from, you won’t be able to influence anything.”

Recruiting a leader

Heintzeman knew it was not his job to find a leader for the new business unit. He understood that as the CIO, it would be difficult to convince some colleagues, particularly CEO Jim Shroer, that the company needed to shift some personnel.

But when it comes to areas where he thinks he can help the company improve, Heintzeman says: “I make it my responsibility.”

First, Heintzeman had to contend with other business unit leaders who were sceptical of his idea. They included Shroer, who considered purchasing a company that had the technology and management expertise.
Heintzeman argued that they could save millions by buying the technology and that Sparkman had the tenaciousness and connections in the company to develop the business unit successfully. Shroer changed his mind and began working on other executives.

Top level support

Getting the CEO on side was a big victory but Heintzeman still had to convince Sparkman.
He turned back to his IT group and set to work building a team that would appeal to her. Heintzeman offered her Ben Leonard, one of his top project managers. They also hired Mike Bradway, an analyst and data modelling expert who had worked on one-to-one marketing campaigns for Target.

Additionally, Sparkman planned to bring one of her own IT project managers, Kurt Wood, who worked directly with her Gold Points clients. Wood could apply his knowledge about those clients to the new IT system.

“At that point, Sparkman was beginning to see a team she knew and who were part of the top talent in the company,” says Heintzeman. Finally, Heintzeman and Sparkman discussed how she could use the new systems he was building to sell the business unit’s services to her existing Gold Points clients.
“Bells and whistles started to go off then,” recalls Heintzeman. “She had a prestocked pond in which to start fishing. That tipped her over.” It took Heintzeman six months to work the relationships he had throughout the company to get Sparkman to take the job.

Redirecting a project

For Peter Walton, CIO with the global energy company Hess, it was an uncomfortable moment when the idea to conduct a global efficiency study was first introduced at an executive meeting in June 2005. Hess executives planned to study the company’s back-office operations such as finance, human resources and IT with the aim of outsourcing much of the work. Walton was not against outsourcing – he had already contracted out some software development and was excited by the company’s aggressive goals for improving its operations relative to its competitors.

What concerned him was the approach – to hand the work over to a single vendor in India. Walton believed that the company should source specific functions to multiple companies that specialised in each area.
Only after comparing the outsourcers’ costs and service levels to its internal costs could Hess determine if outsourcing would benefit the company. “In my experience, nobody has headed into a project like this without having an outsourcing strategy and we didn’t have one,” says Walton.

Walton knew that simply stating his opinion would not convince anyone of a different approach. A more effective way would be to put together a presentation detailing the latest expert opinions on outsourcing and delivering it to the managers in charge of the project.

Providing facts from experts, Walton believed, would remove any chance that his position would be viewed as subjective. The first person he would have to convince was the project manager in charge of the efficiency study, John Douglas. Fortunately for Walton, he had worked with Douglas on a project two years prior and the two had gotten to know each other. “There was some trust already there,” says Walton.

Identifying problems

Back in his office, Walton combed through data he had collected during his three years as Hess’ CIO and picked out some key points, including two slides from consultants The Concours Group.

One slide, entitled ‘a blunder: the wrong way to outsource,’ presented the path that a global electronics manufacturing company took to outsource many of its IT functions. The company’s new CEO had promised to cut IT spending by 18 per cent but the goal had no connection to the company’s overall business strategy.
Written on the slide were the consequences of that approach: the company lost some top employees as well as its reputation as a great place to work. The result was a complete reworking of its outsourcing contracts.
The second slide presented another case study, this one of a global financial services company. The company’s executives believed there was a looming shortage of critical IT skills that the company knew it needed. It chose to outsource more than 60 per cent of its IT staff to get those skills, giving the work to six vendors with operations in the US, India, The Philippines and South America, which were chosen based on their expertise and cost. As a result, the company improved productivity, reduced costs and improved the level of IT skills available.

Walton sent the material to Douglas, who agreed to consider the more strategic view. After conducting additional research, Douglas brought in The Concours Group to make a presentation on sourcing strategy to the executive steering committee. Subsequently, Hess determined it would outsource different functions to separate companies specialising in the relevant fields. “You need outside materials that have a wow factor that can hit your audience right between the eyes,” says Walton. “When you’re considering operating in the same way as the case study that ended in failure, that’s powerful.”

Explaining IT

When Partners HealthCare System CIO John Glaser met with his boss, CEO James Mongan, to pitch an investment in service-oriented architecture (SOA), he knew the meeting had the potential to be difficult. He wanted to introduce Mongan to a complex IT theory and explain how it could be a strategic asset but he knew Mongan had little patience for theory and less for technical detail. But today, Glaser is near to signing a contract to develop an SOA.

He attributes his success to the simple fact that he took the time to understand how Mongan likes to receive new information. That is something most CIOs fail to do, Glaser says. “If you don’t understand how they learn, it will be like talking to your teenage daughter,” says Glaser. “The root language is the same but you have a difficult time understanding one another.” Glaser says discovering Mongan’s learning process was unscientific and took months. Glaser gathered intelligence by talking to colleagues who had met with Mongan, asking what worked and what his reaction was to certain approaches.

The right approach

He observed Mongan both in one-on-one meetings and in executive meetings, noting how he responded to presentations and different communication styles. He also asked Mongan directly about how he liked to have information presented. In essence, Glaser developed a close working relationship with Mongan to know what made him tick and learning how best to communicate with him paid off when he made the SOA pitch. He started with a presentation that illustrated how Partners hospitals and medical centres could not share patient data. Glaser knew Mongan cared a lot about patient safety, so he described an example of how data about patient allergies and the incidence of diabetes were not accessible to all the medical professionals who needed to know.

“That’s trouble. This was set up in a way that somebody could get hurt,” says Glaser.
Glaser then showed a slide that illustrated how a properly designed network could enable healthcare providers to share all patient data easily and more efficiently.

Grasping the idea

Not until the end of the presentation did Glaser mention SOA. But when he did, he equated the theory with real life examples and business value. “That’s how he likes to learn.” Glaser hoped the presentation, designed as it was to Mongan’s preferences, would spark off a discussion.

Mongan stood up from his seat and walked to a large whiteboard. He drew a box on the left-hand side, representing patient data that was stored in database silos. He then drew a box on the right and pointing to it, said: “If we had a common application here, wouldn’t that solve the problem?” Glaser said he was right but it was expensive and would drain other resources.

Mongan then drew a box in the middle, representing the SOA, tying together the application box and the databases box. “Right then I knew he had internalised it and made it his own,” says Glaser. “He understood it and was ready to take the next step.”

The lesson is everyone learns differently and successful communication requires more than not speaking IT jargon. It requires knowing your audience and tailoring your message accordingly.

Building support

Sue Powers, CIO for Worldspan, relies on a methodology called ‘socialising an idea’ to nudge, cajole and encourage her colleagues to consider a new IT system or business process.

The approach is an active one. It requires more than running an idea up the proverbial flagpole. Socialising means active engagement and interaction outside formal meetings. During casual conversations people are more at ease and more willing to discuss change. They are more likely to discuss their objections to an idea, making it easier to come up with solutions.

“In a formal setting, people can feel pushed into an idea,” says Powers. “This way they feel they can be more honest.”

A fair deal

For example, a few years ago, Powers wondered why Worldspan could not get the same internet access deal she had at home: an inexpensive DSL connection. At the time, Worldspan, which operates travel reservation systems, spent $400 to $500 a month for a fairly low-bandwith connection linking the company to its travel agent customers. Worldspan CTO, David Lauderdale, began talking with Worldspan’s 650-member technology team about how much more flexible and efficient a standard IP network could be. The technology team was sold but they had to convince the rest of the company. And then the objections came fast and furious. Some business managers speculated that travel agents would not want to buy their own PCs and internet service, preferring to have Worldspan provide their connectivity. Others worried about the technology transition.

Salespeople said Worldspan could not get out of its contracts, which required Worldspan to provide dedicated service and equipment.

Pushing through

Powers and her team persevered. They spent several weeks discussing it with business colleagues and customers during lunch, after company meetings, at functions or during casual conversations. Powers did not emphasise cost savings – although the new system would ultimately save tens of millions of dollars.
Instead she solicited reactions to the potential benefits of the change – the new system would be more reliable, easier to maintain and simpler for people to use.

“The early feedback from these initial conversations caused us to think more about what was in this for everybody. We were able to better think through the benefits for customers and salespeople,” Powers says. “We ended up with a better plan.”
Powers used the feedback from informal discussions to write a business case for the new system and the plan was approved immediately. When it came to rewriting customers’ contracts, the travel agents were sold on the added benefits they would get. Worldspan completed its rollout of the DSL network last year.
“Getting people involved early by talking with them allowed us to overcome objections and actually have a better sales plan,” says Powers. “By the time we did the business plan, we had everybody pretty much on board.”