Chapter 1: Getting started
Enjoy being CIO. Not many achieve this opportunity, so you should enjoy running such a vitally important department as IT for your company, corporation or government department. Look after your home-work-life balance. You know in your heart what this should be, but you probably don’t get it right. I don’t. Try to do better … and keep on trying! At least you will get points from your family or partner for trying.
Plan your time carefully and strategically. For example, I try to spend 20 per cent of my time on communication with our people, 20 per cent on the management of my department, 20 per cent on specific strategic projects like Terminal 5 (T5), 20 per cent on wider BA business, 10 per cent on our change programme and 10 per cent contingency. The exciting aspect of being CIO is that you can see across your whole company and all its departments. The demands on your time are immense, as are the pressures, which can more than consume your available energy. Control your day and set yourself broad targets for what you do and review them each week or month. Only one thing is certain, you will fail to meet your targets, but the act of setting them is important and the results will surprise you and pose some interesting questions.
Do not be frightened of Technology (with the big T) – enjoy it. You are the chief information officer and director of information technology, whether you have a technical background or not. My dark secret is that I am a historian by training and a civil servant by original profession. Maybe that’s why I really like technology and am still excited by it. You are responsible for IT and need to understand the issues and be able to explain them intelligently to your colleagues. Given the breadth of technology these days, no one can be a deep expert on all the technologies and systems in use – experts must rely on other experts for advice. So talk to your experts, know their strengths and weaknesses, and whose judgement you can trust. You need to be able to understand technologies so that you can explain them to your peers in a business-like way.
Become a non-executive director. A business and its executive directors look very different from the other side of the board room table. You will immediately understand those strange concerns and suspicions of your own board when you see it from their side. Contrary to popular opinion, most non-executive posts are not well paid and they have onerous legal responsibilities. Do not take on too many; one is enough. Select something worthwhile; beware risky start-ups and collapsing giants. Select something that can succeed and that really needs your IT and business expertise. You might as well get satisfaction from the investment of your precious time, advice and energy.
Try to be human. It’s a tough one I know for us IT introverts. People expect a lot from directors and CIOs. They want leadership, but they would also prefer to work with someone who is not afraid to show that they have emotions too. Admit to making mistakes when you do – hopefully they will only be minor ones. (I’m not much good at this one!)
The most important issue for you is the operational performance of the key IT systems against their Service Level Agreements. Your primary task is to ensure the operational integrity of your company. In an airline this is 24x7, around the world. If you aren’t doing this, don’t even think of talking to your colleagues about ‘how IT can be the agent of business transformation’. You won’t get through the door and won’t deserve to.
There are no IT projects, there are only business projects. The entire purpose of your IT department is to move your business forward. So investment, even for IT objectives, must deliver solid financial or other business objectives – if not, just say no! This ‘commandment’ is fundamental – forgetting it is extremely common and exceptionally dangerous for you and for your business. Without it you are just an IT supplier, not an IT partner.
Understand your industry and love it. Build your IT strategy around your company’s direction. Invest time in understanding the strategic issues that are impacting your company, your CEO and your board. There will be economic and, increasingly, environmental challenges, competitor action and regulation like Sarbanes Oxley. Identify them, analyse them and line up your IT department behind your company’s strategy.
Your relationship with ‘partners’ in the business (or ‘victims’, as they probably see themselves) will make or break you. Ensure that you have effective relationship managers who stand with one foot in the business and one foot in the IT department. I have ‘heads of IT’ who act as ‘mini CIOs’. Their job is to be my director colleagues’ own CIOs, hopefully sitting on their leadership teams. The job of these heads of IT is to make the IT department perform for the business and to explain the opportunities and constraints of IT to the business. This is a really tough job, but a vital one – they are the meat in the sandwich.
Communicate, communicate, communicate. Talk to your people about their – and the company’s – objectives, its successes and failures. Face to face is best; informal chats with small groups often work just as well as the big set pieces. A personal email message every so often is a good idea as well – providing you write it yourself. Ensure that people know they can talk to you or email you in confidence. Always reply to any approach, in person or by email, whether you think they are sensible or off the wall. You must respect your people if you want them to respect you. It’s hard to overdo communication, and remember IT people want facts, logic and analysis, not assertion and emotion.
Benchmark your performance against competitors and partners, and do it in a way that makes sense to your CEO and director colleagues. Benchmarking is vital, but only if the results are meaningful to your peers and to the board. So the percentage of company turnover spent on IT by other companies and competitors in your industry should be keenly monitored, not weird ratios like ‘function points’, ‘cSpecs’ or ‘MIPs per employee hour’. It is fine to benchmark these internally if you like, but keep them between consenting IT professionals.
Ensure that you and your direct reports project the IT department’s performance across the company. Everyone in the IT department, but especially your top managers, should sing from the same song sheet in projecting your successes and the way you are tackling problems. Few things undermine confidence in the IT department with their customers as much as their IT colleagues squabbling over technicalities. But remember you can’t make your people do this, they have to really believe in your IT vision to be convincing. We all need to do better here.
"The entire purpose of your IT department is to move your business forward"
Try to talk to the people who do the work in the department, for example the project leaders, IT service centre agents and analysts. A core skill of your direct reports and theirs is that they tell you what they think you want to hear. So try to talk to the people in the front line too. We set up a Focus Group composed of volunteers from each branch to talk to me about any issues and try to meet groups without their managers.
Chapter 2: Running smoothly
Keep IT simple. Never present IT issues as obscure or too difficult for ‘ordinary’ businessmen. First, they are not and, second, you will fast alienate your colleagues. Whatever you do, do not let your people pretend they are priests of an obscure religion! Get your people to talk clearly about technology to your partners in the business; do not use jargon and explain business benefits or impacts in ways any business person can understand.
Be visible and loud about IT and celebrate success. We have an Annual IT Fair, financed largely by our suppliers, which showcases our own IT achievements and their goodies. It fills the ‘Street’ at our HQ for two days. We have held five of them so far. The October 2006 Fair had 20 BA stands manned partly by IT and line people, demonstrating their latest project successes, and about the same number of supplier stands. However tight the budget you can always say “thank you” personally and if you can somehow find the money to have a bit of a do, so much the better. See if you can get the suppliers to pay, it’s actually a much better investment for them than taking CIOs to a rugby match. However, ensure that only genuine success is celebrated, not plans, nor hard work that failed. Only celebrate genuine achievement and recognise that IT success is usually a team sport. And don’t neglect the back room colleagues who supplied the servers or got the network working.
Work to enter the ‘business transformation’ space. Most IT projects that fail, fail not because IT does not work, but because the business proposition was not properly worked out; or the business failed to change the processes; or the people who needed to work the systems were not trained. So many consultancies see Business Process Outsourcing as the next big opportunity. They will help your businesses transform, at considerable cost. Your IT department should be able to enable this at lower cost, so polish up business analysis and change skills. We built our IT and Business Change Unit (IBC), which combines IT design with business analysts, process change experts in ‘lean’ methods and operational research skills. We explicitly require them to focus on the ‘Proposition, Process and People’ aspects of business change before – and indeed sometimes instead of – IT. We call this approach ‘3PI’.
Eliminate ‘shadow’ IT departments in the business. In companies, directors and their departments develop their own IT capabilities to escape your standards, budgets and controls – these shadow IT departments need to be annexed or abolished. This will result in immediate manpower savings and benefit in standardised centralised IT with economies of scale and better IT security. You must also do this to ensure Sarbanes Oxley compliance. Your CEO and CFO will understand this, but you should also reflect on why your colleagues felt the need to set them up in the first place – the actual or perceived failings in your own department.
See if you can become the champion of ‘Business Simplification’ in your company. Many CIOs make investment decisions on the basis of technology. Use technology as a lever to drive in simplification, cost savings and better customer service. Strike out complexity and cost wherever you find it.
However tough the business environment, do not lose sight of innovation. Technology is always changing; ideas for using IT are still emerging. Ensure you and your team keep on top of trends and have some fun with this. It can be gimmicky – like the ‘robo-check-in’ we once pioneered at Heathrow – or revolutionising business change like the ‘print your own boarding-pass at home’. We have kept some innovation going through hell and high water. Service Oriented Architecture (SOA), despite the hype, looks promising, especially linking technical and process architectures. So does virtualisation at the moment.
Really be part of your company. Help other departments when they are in trouble. When BA had disruption at the terminals at Heathrow, we put in an SMS text messaging system in less than 24 hours for the volunteers helping our passengers. Furthermore, many of the volunteers in yellow tabards out front helping were us from the IT department. You are part of your company, not part of an IT supplier who cares only about their margins. Show your colleagues that IT is part of, and cares about, the whole business.
Chapter 3: Pushing boundaries
Use your power and authority as CIO. Many CIOs who have risen through the ranks of the IT department do not exercise their positional authority, they seem reluctant to take decisions they could, and they defer to ‘more important’ departments. They fail! See if you can get on your company’s key committees. Each company has a set of key groups or committees, for example Capital Investment Committee, Manpower Control, Strategy. Seek a place on some of these. This enables you to interact with your director colleagues on an equal basis. It makes your department feel that it has a voice at the top table about general business issues, not just IT. It broadens you and makes you part of the company’s strategic mainstream.
Your most important relationship is with your CEO. Make sure you understand your CEO’s business strategy and support its execution. Do your very best to ensure that the IT department’s efforts are aligned with the CEO’s direction. Since IT covers the whole enterprise, you are a powerful engine to deliver their objectives.
Close behind comes your relationship with the heads of departments. Try to understand what motivates your colleagues and what they want from IT. This will vary enormously. In an airline, for instance, the director of airport operations wants 24x7 reliability, the commercial director wants a leading-edge website for selling and servicing, and the director of planning wants systems that optimise complex schedules. You need to provide all these and understand the very different agendas and emotional needs across your company.
Picture the scene, I am in Heathrow Terminal 1 the Saturday before Christmas, in freezing fog, wearing a yellow tabard over a skiing fleece, clutching a list of flights, explaining to a family with an infant and pregnant mother on a freezing night why all flights to Berlin are booked until Christmas. What on earth has this got to do with being CIO? Well, there are no IT projects, only business projects – the biggest business project is British Airways. The three days of freezing fog before Christmas 2006 marooned thousands of passengers at Heathrow as is well known. Less well known is the fact that with 50 per cent of the flights cancelled we got 80 per cent of the passengers away. This still left thousands of stranded, angry and confused people to be helped. I am proud to say that many of my colleagues in BA’s IT department at all grades volunteered to go to the terminal to deal with the crisis.
An airline is an emotional place, people talk about passion a lot. They believe in it, as well as working there. That’s why the IT people are totally integrated into the airline – freezing fog and all.
Spend time with the members of your board who are expert in and interested in IT. The board is more important than you may think. You will have members on it who know about IT, they may themselves be CIOs or CEOs of IT companies. Offer to brief them so that any discussion at board level is genuinely informed, since other board members will look to them when IT questions arise – and to assess your performance as CIO.
"Make sure you understand your CEO’s business strategy and support its execution"
Support the basic IT services for your chairman, CEO and executive team colleagues effectively. They will not use the much more important operational systems themselves, but they do depend on their mobile phones, PCs and PDAs whether they are at the office, at home, or travelling. How can they rely on you to run their major systems if you can’t get these basics right? Make one of your senior managers accountable and make sure there is a smart person ready to support them and their PAs.
Reduce the year-on-year costs of IT operations every year, whatever the growth in demand. CEOs know – because outside suppliers tell them – that the unit cost of IT and telecommunications is reducing. IT outsourcing salesmen can – and will – offer substantial year-on-year reductions. You had better be able to do better than them. You should be able to, since – unlike them – you are not making a 10 per cent-20 per cent, or even larger, margin on providing your company’s IT.
Work closely with finance, HR and procurement managers as part of your team. As a member of the company’s leadership team, the CEO and colleagues will judge you on your control of finances and management of people and suppliers. Whether they report to you or to another director, work closely with the finance, HR and procurement managers who influence your fate in these areas. Remember that a tame finance or procurement manager, with no credibility with your CFO, is no use to them or to you.
If you’re not scared as CIO you either lack imagination or don’t run the IT. These days most businesses, government, central, local, health service and military depend on information and communications technology. An airline is totally dependent on its IT – stop the check-in systems and you close the terminals in less than three hours; lose the revenue management system and you cannot sell.
The two points when I have been most afraid were when we put in new reservations, check-in and inventory at the same time, and when we put the new SAP system into engineering. These were both ‘open-heart’ surgery for the airline, or probably more like a brain transplant. Both were Big Bangs since there was no alternative to throwing the Big Switch.
You can plan and replan, put in contingency plus, audit and reaudit, hold go/no-go meetings, but with these complex cut-overs you can guarantee that something you did not foresee will go badly wrong. It’s then that you find out if you have a good or a great team. Great teams can manage whatever fate throws at them, because they have both the skills and mutual trust.
When the call centre system crashed as a result of the new reservations system, we found a way to manage it with our line partners but it was very scary.
This is not about the technical fix, it’s about what you do as CIO. I tried not to look as scared as I felt and to leave fixing the problems to those who knew how to fix them. I explained elsewhere in simple terms what was wrong and that we did not know how long it would take to resolve. Since I was visible outside the IT department everyone else’s concerns and anger could be unloaded on me, not on those finding the solution.
We have another lever to pull on March 31 2008, when we open T5 at Heathrow and that’s terrifying.
It may be the oldest management adage, but your staff really are your most important asset. Many CIOs still think more about their new hardware, software, routers or enterprise software – but they are wrong. You are entirely dependent on the skills and commitment of the people who work with and for you, and of course the skills with which you manage them. Remember, you work with human beings, not machines. By all means ask a lot, but we all have emotions, make mistakes, want a raise and would like some fun and time out of the office – even if you don’t. (I have trouble doing this one.)
Chapter 4: Managing your team
Spend time developing the people who report to you directly. If you can rely on those who report directly to you, you have a priceless asset that multiplies your effectiveness many times. Always make the appointments of your direct reports and approve all senior promotions. Take great care about who you appoint, then set challenging but achievable objectives for them. Review these once a quarter, individually if you can. Work with your direct reports as much as you can, and find them coaches when you cannot. Trust their judgement as much as possible. Try to understand what they want to achieve for their own personal growth. Look after your team, but remember you must move them if they do not perform against your clear and measurable objectives.
You are running an IT department: ensure that you have genuine IT experts. Bizarrely, some CIOs think talking about the business endears them to the business. Wrong. Knowing about how IT can be used effectively must come first. The quality of your people is vital to your ability to add value to your company. Train them or recruit them, do not lose the good ones. Make sure everyone in your IT department knows that a genuine top-level technological expert is more important to you and the business than a general manager who you can always promote or recruit.
Keep your department’s skills fresh. Understand the major trends in IT; there are any number of people and plenty of reading to help you do this – too much in fact. If Service Oriented Architecture is hot now, you had better know whether it’s the real thing or hype, and whether it can help or maybe even destroy your business. Ensure that your organisation reflects the technologies you need. Generally, in a mature corporation this means blending new technology skills with more practical experience in your inherited legacy systems.
Grow your programme and project management skills. The IT department should be the centre of excellence in most companies for programme and project management. Ensure that you are, and use it to your department’s and your company’s benefit. We have been able to work closely with our colleagues at London Heathrow in project managing and process re-engineering for T5. It is an enormously important and rewarding challenge for our people.
Recognise the vital part played by the IT operational people; do not let the new development people get all the glory. You depend on the effectiveness and the commitment of your operational people, so go to the operations bridge, the IT call centre and remember to thank the people who stayed overnight to keep key systems going or to recover them. They are heroes as well.
Look out for the IT ‘cultural cringe’. IT people often prefer to moan in corners about the ‘ignorant business’ rather than stand up and be counted. So instead of standing up and saying “that’s bad for our company, it’s a technology dead-end”, they shrug their shoulders and complain about the business ignorance of IT around the coffee machine. To help your people, you must stand up and be counted. They must take the personal risk – when necessary – of a tough debate with the business, which they may lose. After all it’s their company, their pay and their pension, too.
Encourage the talented and know who your rising stars are. There is nothing more satisfying than seeing someone you have encouraged, or appointed to a job, succeed in it beyond your and their expectations. Sometimes this just happens through natural talent, but more often you need to be their mentor or find someone else to help them develop. Know who your rising stars are. Have a chat with them every so often. Encourage them and give them visibility and support so that others emulate them. (I should do this more.)
IT department structures. Having tried several structures of increasing levels of baroque complexity, it suddenly hit me that there was a very simple answer. Basically, you need three large boxes and two thin slices. The three large boxes are IT operations: running what you have already; IT delivery – building the new systems; and IT and business change – designing the new business processes and systems that enable change to happen. The two thin slices are relationships with the business departments (the heads of IT) and running the IT department. So, at its most simple, an IT department needs only a CIO and four general managers (ops, delivery, change and running the department), plus the right number of heads of IT to help you manage relationships with the business.
"Do not favour the unions but don’t ignore them either"
Chapter 5: Ensuring success
IT security and Sarbanes-Oxley. Recognise the risks of the modern world. Take effective tactical actions and develop an effective IT security and control strategy. Never neglect IT security; your auditors will not. You can’t win here, but you must not lose either. Always be on top of the developing threat and risk situation and look into the security networks, formal and informal – it’s a small village. Invest what is necessary and personally review progress monthly to show this really matters. If you are being Sarbanes-Oxley’d, first encourage, then compel people to do the multitude of small changes that are essential for Sarbanes-Oxley compliance. This is not an option; those of us who have now been through the Sarbanes-Oxley experience recognise it is essential to doing business today. We in IT are often seen as the weakest link. Ensure you are not.
Work with your trades unions. Some IT departments are unionised, especially in the public sector – where there are large IT operational outfits – and in Europe. You should recognise the legitimacy of the recognised existing trades union structures and ensure that the union representatives, elected and full-time officials, have access to you if and when they need it. Listen to their points – if they are about genuine issues – often they are telling you what you need to hear and giving you early warning. Many people who become involved in union work are driven by idealism and want to protect people from what they perceive as poor management. Sometimes they are right. Ensure that day-to-day industrial relations issues are handled fairly by your managers, so you are seen as an escalation point for the more important issues. Do not favour the unions but don’t ignore them either.
Closely monitor the reports of the external and internal auditors – these go to the Board Audit Committee. Often the only detailed reports on IT that reach the board are unpleasant reading from auditors – monitor these, challenge inaccuracies and put in action to address genuine issues.
Be clear about what your objectives are and translate them into unambiguous and measurable targets. OK, this is basic but it’s amazing how often it gets overlooked. Some of your people will design woolly and easily achievable objectives. Personally review their progress with your direct reports every quarter. Have as many quantifiable measures as possible and ensure that people recognise how interdependent they are for their success on each other. Team KPI’s and rewards recognise how ‘joined up’ IT usually is.
Divide your team into sub-groups to deal with issues. Everyone can have a view on everything and IT people generally tend to. However, people have different strengths, so delegate responsibility for key areas to sub-groups of your leadership team. This builds their personal accountability and encourages people to trust each other’s judgement. Most importantly, it expedites business. Our areas for sub-groups in BA, for instance, are business planning, manpower control, IT portfolio management and technical standards.
Personally review major project launches carefully before going live. Beware ‘project delivery’ over-optimism. The pressure on project leaders and teams to deliver to dates and tight budgets is intense. Project managers tend to be strong personalities who overcome other people’s objections, so you must insist on objectivity in assessing readiness for cut-over to new systems and review it yourself personally. Look those responsible in the eye and ask yourself – do you trust their judgement? Never trust to luck rather than judgement. Also before major system launches, insist that the business is involved in readiness reviews. As well as looking your people in the eye before a major launch, look the business sponsors in the eye as well and quiz them, especially about training their people and their business processes. Remember 3PI.
"Do not expect loyalty to your company unless you pay for it – and even then you would be foolish to take it for granted"
Look after the pennies as well as the pounds. At regular intervals conduct a purge of unused PCs, phones, mobiles etc. After 9/11 we had a Star Chamber (of course, Henry VIII had the first one down the road from Heathrow at Hampton Court), which reviewed every penny that leaves the IT department. This should not harm IT operational integrity. We have cut IT operational spend by 45 per cent in five years, while improving the quality of performance of our key systems by two and a half times over the same period. Attention to detail.
Really enforce your technical standards and understand the total cost of ownership (TCO). Everyone has technical standards, but few really enforce them because of pressures for new systems. Good standards will reduce complexity and reducing complexity will reduce costs and speed up delivery. IT salesmen push new technologies and upgrades for new functionality to you and your users. The benefits of these are stressed and the cost of complexity is glossed over. So build TCO or better still, total cost of complexity, into all strategic technical assessments.
Make pay for performance count. Reward those who have really delivered, using whatever mechanisms you have. I, and my leadership team, collectively rate all our senior managers every year. This provokes liv