Nicholas Reeks has led the shift to digital thinking in the organisation, changing the IT agenda with sales and marketing from ‘order entry’ to e-commerce, EDI, portals, website updates and a big data capability. Just as importantly has been the role of building a relationship with the core partners in a heavily outsourced IT function to support and deliver on digital initiatives and modernising an IT backbone with years of underinvestment.

Job title
Director IT, vendor management

Company name
Tata Steel

How are you influencing the products, customer experience and services your organisation offers to its customers?
I led the shift to digital thinking in the organisation, changing the IT agenda with sales and marketing from ‘order entry’ to all leading projects for e-commerce, EDI, portals, website updates and the need for a big data capability. In a traditional industry with a B2B focus, these changes require increased efforts and emphasis, given the multiplicity of legacy systems and the internal culture.

From the current position overseeing outsourced IT operations, my role is to build a relationship with the core partners to support and deliver on both digital initiatives and modernisation to ensure the IT backbone, with years of underinvestment, is brought up to standard.

Define the key business outcomes that you have delivered over the last 12 months and their impact on your organisation’s performance
In 2016, Tata Steel Europe confirmed it would outsource its IT function across the UK and Netherlands locations. Although outsourcing had taken place in the UK (1997), the organisation had largely increased its internal footprint, and no outsourcing had been attempted in the Netherlands operations.

From point of contract finalisation in January, the process of interviews and selection for the retained team (130) was complete by March. By end of April, transfer arrangements were in place for over 350 employees and contractors, and contracts started for infrastructure, workplace, application maintenance and support, and application development. Transition activities took place for six months to ensure no service disruption was experienced. Over the first eight months, no major incidents related to outsourcing have been seen, and areas such as the service desk have been moved to India, with call response times improved from under 50% within one minute to under 80%.

Crucial to the success of the new operating model is the relationship with the four partners: operational, service, contract and strategic. Reviews were set up and running once the contracts commenced.

The next phase, transformation, commenced at the end of 2016, with initiatives to consolidate datacentres and overhaul an application landscape of over 1,250 applications, the oldest of which dates from 1980.

With the executive committee (exco) leading a major shift to digital and manufacturing 4.0 initiatives, the ability to draw on partner experience to drive this ambition will be vital to success.

What has been your involvement with innovation at your organisation – in particular, with products, business model and technology – over the last 12 months?
Key areas of focus have been on data. From 2013-15, a new central reporting factory was created, providing a consistent (and only) set of customer data from all parts of Tata Steel. Although initially designed for standard reports, the concept has provided a central source for CRM tooling, supply chain analytics and the first big data project.

Given the complexity of identifying and consolidating customer data from multiple sources, 2016 saw significant planning and design of a structural big data solution using a cloud-based Hadoop capability. We will use the outsourced partners to translate the concept into a core scalable solution in 2017.

How have you delivered cultural and behavioural change as a CIO within the IT department and/or more broadly across the organisation?
Tata Steel is a traditional business to business manufacturing operation, where IT has had a stronger emphasis on cost rather than value. Over the past two years, this emphasis has changed, as more and more people are looking for technology to underpin productivity and cost improvements, as well as speed up day-to-day tasks.

One of the first adopters of O365, Tata Steel has used this platform to push availability of mail/documents on any device and in particular to transform communications through Skype. Use of phones and mobiles has fallen, and set-piece monthly events have switched from Webex to Skype. Some functional areas have also pushed forward their working style through the use of Yammer and video for increased communication and awareness. Indeed, one of the new CRM products released has no service desk support, but relies on monitored community support via Yammer.

Setting out the IT strategy to focus on digital, work with partners and emphasise flexibility for users are all key aspects designed to change the profile of IT in the organisation.

How have you worked with your CEO and/or board to communicate whatever ‘digital’ and IT means to your organisation/sector and improve digital literacy at the highest levels of the organisation?
Over the past four years, particularly focused on the relationship with sales and marketing, there has been a dramatic shift to develop a digital agenda as the centrepiece of the IT work. In 2016, a digital programme was initiated for all the functions, bringing together the digital, manufacturing 4.0 and big data themes, sponsored by the CEO and overseen personally by one of the exco members. This programme has been led and facilitated by the IT team, with support from all the outsourcing partners.

With the core outsourcing programme, the support from the CEO was strongly linked to the opportunity to modernise the IT landscape and focus on areas of transformation using technology. The partner relationship model put in place under outsourcing includes regular meetings with the CEO and the senior leaders of the partners, where the digital agenda is the leading feature.

How have you worked with the technology and IT vendor market to achieve your business goals? How have you been able to influence IT suppliers and successfully manage your partnerships/relationships with large IT companies, SMEs and startups?
2016 has heavily focused on building a strong partnership with four key vendors – IBM, TCS, Capgemini and Vodafone- as part of the outsourcing programme. These partners have worked collaboratively with Tata Steel to undertake the transition of services and people designed to provide the business with a more substantive IT function over the course of the five-year contracts.

Each of the partners has also provided a key point of leadership for bringing in new capabilities, with IBM setting up a project based on its Watson technology, TCS completing a full application landscape analysis (more than 1,000 apps dating from 1980), Capgemini facilitating the digital programme startup, and Vodafone proposing a full move to Skype for Business to lower the cost of telephony.

The collaboration is not restricted to the outsourcing partners. Microsoft, SAP and Opentext – our other key suppliers – understand the opportunities for modernisation and cost reduction, which are the principal needs of the Tata Steel estate. The new organisation, with an overt focus on vendor management and a strengthened EA function, is the driving force for the relationship building with the vendor base. Through 2016 a formal vendor management programme has been deployed.

How have you tried to develop the diversity of your team?
One of the reasons for seeking an outsourced arrangement was to increase the flexibility and reach of skills available to the IT organisation. Through the choice of four partners, we were able to tap into resources from multiple backgrounds and geographies to enhance the teams.

With a long-term large in-house organisation, there has also been a need to recruit graduates and trainees for the IT area, which is something we restarted in 2015 and continued in 2016 after several years of no recruitment.

Describe how you organise and operate IT and how this aligns effectively with business strategy and operations
The IT function is organised centrally for Tata Steel Europe with a reporting line to the Tata Steel Group CIO in India to maintain overall group IT alignment where required. The European organisation operates on a functional basis, so there is strong alignment in the overall structure.

Nonetheless, the changes in the business context for Tata Steel in 2016 means that the IT function needs to reflect an ‘ambiguity’ required for crucial strategic differences, with divestment in the UK and associated creation and running of TSAs with divested elements, intense cost focus in the UK and massive modernisation of manufacturing systems in the Netherlands production asset.

What strategic technology deals have you made in the last year and who are your main suppliers and IT partners?
The most significant technology decision in 2016 was the acquisition of PSI Metals licences to develop and install a new manufacturing enterprise system (MES) to replace multiple legacy systems in IJmuiden and associated plants. This is a four-year replacement project which will substantially transform the IT landscape for manufacturing.

Other key extensions and deployments have featured SAP cloud options, with Success Factors going live in 2016 as well as the use of Hybrid as an e-sales system.

The outsource partners – IBM, TCS, Capgemini and Vodafone – represent the bulk of external spend and technology. Outside these, the key suppliers are SAP, Oracle, Microsoft and Opentext. At the end of 2016, agreement was reached to move the service desk and SIAM processes into a ServiceNow landscape, which will be deployed in 2017.

What are your key strategic aims for next year?
With such a significant overhaul in the IT organisation in 2016 through the outsourcing programme and the transition of services as is, 2017 will be focused on transformation. With all the partners, the emphasis will be on the modernisation and standardisation objectives for the core IT operations as well as a step up in the delivery of new technologies, especially for big data, digital initiatives, SAP Hana, ServiceNow, e-sales, customer portal, etc.

The Tata Steel objectives reflect a much greater customer focus and utilisation of the emerging technology to improve customer reach and target cost improvements. The work with the outsourcing partners and the first-tier key vendors will also focus on these aspects to support the business operations.

How are you preparing for any impacts Brexit might have on your organisation?
Shortly after the Brexit referendum was announced, Tata Steel announced plans for the sale of its UK assets from its portfolio of European assets, so the context of separation before and after the Brexit result was very real.

The experience led to scenarios being developed as to the form and shape of the teams, the way in which contracts would be struck, and indeed what standards would apply. In almost all scenarios, apart from scale, there were few differences which would be adopted either for infrastructure or application management and certainly no differences for data or security aspects.

Tata Steel confirmed in late 2016 that it was selling only limited UK assets and retaining a UK/NL footprint. In this context the approach will be to be in line with all EU regulations and standards while maintaining a watching brief on the negotiations.

YOUR ROLE

When did you start your current role?
April 2016

What is your reporting line?
CIO

Are you a member of the executive leadership?
No

Are you a member of the board of directors?
No

What other emerging roles does your organisation have and what is their relationship to you?
None

How often do you meet with your organisation’s CEO or equivalent?
Monthly

How many people at your organisation does your function supply services to?
20,000

BUDGETS

What is your annual IT budget, or your spend as a proportion of the organisation’s revenue?
£160m

What percentage of your budget is operational spend (ie keeping the lights on) and how much new development (ie innovation, R&D, exploratory IT)?
56/44 run/project.

CIO INFLUENCES

Rank the following sources of advice/information in order of importance:

  1. Analyst houses
  2. CIO peers
  3. Industry bodies
  4. Consultants
  5. Media

IT SECURITY

Has your organisation detected a cyber intrusion in the last 12 months?
No

Are you expecting an increase in budget specific to security in order to tackle the cyber threat?
Yes

Does your organisation have a designated security professional – CISO or otherwise – and what is their relationship to you?
Yes – IT leadership team colleague.

RECRUITMENT

Are you finding it difficult to recruit the talent you need to drive transformation?
Yes

Has recruitment and retention risen up your agenda as a CIO?
Yes

Does your IT organisation operate an apprenticeship scheme?
No

How many employees are there in your IT team?
140

Are you increasing your headcount or planning to bring skills and the ability to react to needs in-house?
No

TECHNOLOGY

Which technologies or areas are you expecting to be investing in over the next year?

  • cloud
  • data analytics/business intelligence
  • ERP
  • IoT
  • security
  • machine learning/artificial intelligence
  • networking/communications.

Which technologies or areas are you expecting to be investing in over the next one to three years?

  • cloud
  • ERP
  • IoT
  • security
  • AR/VR
  • machine learning/artificial intelligence
  • wearables
  • 3D printing
  • networking/communications.

What emerging technologies are you investigating or expect to have a big impact on your sector or organisation?
AI/cognitive learning (to support customer operations) and AR (especially for engineering) most notable. IoT platform crucial to competitive position and improving productivity.

THE EU

Does your organisation do a significant amount of trade with the EU?
Yes

Does your department include technology staff from the EU?
Yes

Are you or have you been looking to the EU to recruit key skills?
Yes