CIO January 15 2007 Issue by Sreekanth Sastry

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From The Editor

Attitude; Aptitude; Vision; User-focus; Business Insight; Perspective. These

Making of a Leader A formal program is the only way to build yourself a solid second line.

are values that CIOs look for in their protégés. Notice that ‘technology knowledge’ is not among them. That’s a given. The nomination forms for CIO Ones to Watch 2007 threw up a bunch of IT executives from a variety of backgrounds, strengths and experience levels. What distinguishes the IT leaders of tomorrow whom we honor in this issue is their passion. For driving change. For building teams. For business strategy. For getting results. Take Bharat Sethi, VP of Reliance Industries. A veteran with over 30 ERP deployments across the group to his credit that have an uptime commitment of 99.9 percent, Sethi has also been able to keep attrition in his team below 5 percent. And, what’s more, he’s regularly consulted by various business and finance heads in the Reliance group on matters of accounts and commercial processes, given his knowledge of accounting and finance. Ashish Kumar Chauhan, president & group CIO of RIL, is clear why he nominated Without a plan that hones Sethi to the program — “Bharat is amongst skills and gets your our top IT leaders with several successes to team mentored, you his credit. He has also been able to motivate can only pray for a large team to provide business with very leadership to emerge. complex but easy-to-use solutions.” Ask what Sethi needs to do to become a CIO and Chauhan’s emphatic: “Today, Bharat’s more than a CIO.” That’s got to be the stuff that the dreams of CIOs are made of. But we have to take cognizance of the nightmares that others face as well. “If there had been a second line worth nominating for the Ones To Watch program, do you think my organization would have had to hire me from outside?” It’s the anguish in the voice of a CIO I was speaking to a few weeks back that underscores the need for all IT teams to not just pray that they have more Sethis among them, but to also build formal technology leadership programs. A course that goes beyond ensuring motivation and retention. A course that identifies and hones personal skills, that looks at career progression, teaches your team networking skills and gets them mentored. How do you go about developing the next level of IT leaders? Write in and let me know your thoughts.

Vijay Ramachandran, Editor vijay_r@cio.in

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Executive Expectations View From The Top | 44 Vaughn Richtor, MD and CEO of ING Vysya Bank, says that IT is as important as people and processes for furthering the growth of an organization. Interview by Balaji Narasimhan

Career Counsel Cue the Spotlight | 23 How the CIO can achieve a measure of fame and celebrity in four simple steps. Column by Martha Heller

Peer To Peer

P hotoS by Sr ivatsa Shandilya AND ajay

From left: Raghavendra Joshi, VP-IT of Yes Bank, Narayan P.S., GM of Wipro, and Vinay Khargonkar, deputy GM & head-IT of Larsen & Toubro, agree that getting to the top requires the ability to build bridges and capitalize on opportunities.

2 3 6 9

Fear of Dependency | 26 Small- to mid-size organizations, using smallto mid-size vendors, must always be ready to break away and stand on their own two feet. Column by Bill Regehr

Data Management Leadership

COVER STORy | ones to watch | 29

Honoring the CIOs of the future and the IT leaders of today.

Cove r: Imaging by Bines h Sreedhara n

content

More | 48 As the demand for real-time data increases, as more and more information flows into the enterprise, the challenge of understanding and managing it grows proportionately. And sometimes, more is just too much. Feature by Thomas Wailgum

introduction | 29 the right stuff | 30 Master class | 36 25 leaders to watch | 42

Features by Balaji Narasimhan, Gunjan Trivedi and Vijay Ramachandran

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content

Essential Technology | 58 VoIP | Don’t Let VoIP Throw You

By Michael Fitzgerald Security | Being a Step Ahead of Potential Threats

By Michael Jung

From the Editor | 3 Making of a Leader | A formal program is the only

way to build yourself a solid second line. By Vijay Ramachandran

Inbox | 16

NOW ONLINE For more opinions, features, analyses and updates, log on to our companion website and discover content designed to help you and your organization deploy IT strategically. Go to www.cio.in

c o.in

Govern Zero-in On the Problem | 54 The Tamil Nadu Forest Department is finding new and more sustainable solutions toward afforestation — on the back of more accurate data and the ability to monitor and evaluate progress.

2 3

Feature by Sunil Shah

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Advertiser Index

ADVISORY BOARD Ma nageme nt

President N. Bringi Dev

COO Louis D’Mello Editorial Editor Vijay Ramachandran

Assistant Editor Harichandan Arakali

Special Correspondent Balaji Narasimhan

Senior Correspondent Gunjan Trivedi Chief COPY EDITOR Kunal N. Talgeri

COPY EDITOR Sunil Shah www.C IO.IN

Editorial Director-Online R. Giridhar

Anil Nadkarni

AMD

Head IT, Thomas Cook, a_nadkarni@cio.in Arindam Bose

Avaya

4&5

Canon

Head IT, LG Electronics India, a_bose@cio.in Arun Gupta Director – Philips Global Infrastructure Services Arvind Tawde VP & CIO, Mahindra & Mahindra, a_tawde@cio.in Ashish Kumar Chauhan President & CIO - IT Applications at Reliance Industries

Fortinet

D es ign & Pro duction M. D. Agarwal

Creative Director Jayan K Narayanan

Chief Manager – IT, BPCL, md_agarwal@cio.in

IBM

Back Gate Fold

Designers Binesh Sreedharan Vikas Kapoor; Anil V.K. Jinan K. Vijayan; Sani Mani

Mani Mulki VP - IS, Godrej Consumer Products Ltd, m_mulki@cio.in

Krone

Unnikrishnan A.V. Sasi Bhaskar; Girish A.V. Vishwanath Vanjire

Manish Choksi VP - IT, Asian Paints, m_choksi@cio.in

Lenovo

MM Shanith; Anil T PC Anoop

Photography Srivatsa Shandilya

Production T.K. Karunakaran

T.K. Jayadeep Ma rketing a nd Sales

General Manager, Sales Naveen Chand Singh brand Manager Alok Anand Marketing Siddharth Singh Bangalore Mahantesh Godi Santosh Malleswara Ashish Kumar, Kishore Venkat Delhi Nitin Walia; Aveek Bhose; Neeraj Puri; Anandram B Mumbai Parul Singh, Chetan T. Rai Japan Tomoko Fujikawa USA Larry Arthur; Jo Ben-Atar

Singapore Michael Mullaney UK Shane Hannam

Events General Manager Rupesh Sreedharan Manager Chetan Acharya

Neel Ratan Executive Director – Business Solutions, Pricewaterhouse Coopers, n_ratan@cio.in Rajesh Uppal General Manager – IT, Maruti Udyog, r_uppal@cio.in Prof. R.T.Krishnan Professor, IIM-Bangalore, r_krishnan@cio.in

Microsoft

Front Gate Fold

R&M

Rittal

Toshiba

S. B. Patankar Director - IS, Bombay Stock Exchange, sb_patankar@cio.in S. Gopalakrishnan COO & Head Technology, Infosys Technologies

Wipro

6&7

s_gopalakrishnan @cio.in S. R. Balasubramanian Sr. VP, ISG Novasoft, sr_balasubra manian@cio.in Prof. S Sadagopan Director, IIIT - Bangalore. s_sadagopan@cio.in Sanjay Sharma Corporate Head Technology Officer, IDBI, s_sharma@cio.in Dr. Sridhar Mitta Managing Director & CTO, e4e Labs, s_mitta@cio.in

All rights reserved. No part of this publication may be reproduced by any means without prior written permission from the publisher. Address requests for customized reprints to IDG Media Private Limited, 10th Floor, Vayudooth Chambers, 15–16, Mahatma Gandhi Road, Bangalore 560 001, India. IDG Media Private Limited is an IDG (International Data Group) company.

Former VP - Technologies, Wipro Spectramind

Printed and Published by N Bringi Dev on behalf of IDG Media Private Limited, 10th Floor, Vayudooth Chambers, 15–16, Mahatma Gandhi Road, Bangalore 560 001, India. Editor: Vijay Ramachandran. Printed at Rajhans Enterprises, No. 134, 4th Main Road, Industrial Town, Rajajinagar, Bangalore 560 044, India

CTO, Shopper’s Stop Ltd, u_krishnan@cio.in

Sunil Gujral

s_gujral@cio.in Unni Krishnan T.M

V. Balakrishnan CIO, Polaris Software Ltd., v_balakrishnan@cio.in

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reA der feedbAck

missing: someone presenting a real-life case study and showcasing how identity management has added value. The vendor at the CIO event mentioned that over 400 organizations are already customers of identity management. I would have preferred an example to demonstrate its value. IShwaR Jha Senior VP (business technology), Zee Telefilms

OS of the Masses As in the past, the January 1, 2007 edition of CIO has again something to update the IT leader’s knowledge and expand his awareness of IT products. The Vista Outlook special issue (January 1, 2007 2007) was excellent. Whether one likes Microsoft or not, one buys its products for a simple reason: they are simple, easy to use, and well-accepted internally. It has been fairly evident with previous releases like Windows 95, 98 up to XP. As an IT person, I will use Vista simply for its security features. Out of my 3,000 PCs in Bangalore, I would first study how many require Vista for critical applications — or those machines that have critical data. I have noticed that most features in a Microsoft product are under-utilized. So, while we would not be replacing all our old OS, the computers with important data are Vista candidates. R.K. Upadhyay

The roundtable on identity management was very good. I believe all the participants must have benefited from it, primarily because all organizations are now in the process of implementing it. This conference gave good insights into the topic. aRUn pande p VP-IT, Colgate Palmolive

Thank you for inviting me to the roundtable. The topic was relevant and important for all CIOs present. Different CIOs come with different exposure, knowledge and level of understanding of a given subject. The inputs provided were good, especially the articulation and simplicity of explanation provided by Jay Huff, marketing director (software practice), Sun Microsystems. He remained within the topic while maintaining neutrality from a product point of view (which is commendable). PwC provided good professional inputs. anweR BagdadI

Thanks for inviting me to the identity management roundtable ('Does Identity Management Secure Business Value?', December 2006). It was a good experience, but here is what I found 16

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The TechnologyStrategy debate An organization would have an ideal situation (Inbox, December 15, 2006) if a CIO knows and understands business processes but is centered on technology, while a CEO has an understanding of technology but keeps business as his core competency. Each one has his or her own core competency, and both can work together. This would make a great combination for business. It rarely happens, though. In most cases, there are gaps in understanding but business goes as usual with understanding and compromise. Therefore, it is important to have a professional and mature approach. K.B. SIngh Head-IT, BSES

Senior VP & CTO CFC International, India

Deputy GM-IT BSNL- Bangalore Telecom District

assigning Id

"A cIO and ceO have their respective core competence, and both can work together. This would make a great combination for business, though it rarely happens."

What Do You Think? We welcome your feedback on our articles, apart from your thoughts and suggestions. Write in to editor@cio.in. Letters may be edited for length or clarity.

editor@c o.in

Corrigendum In 'The Path of Technology Leadership' (View From The Top, January 1, 2006), Polaris Software Lab’s chairman and MD Arun Jain was incorrectly identified as Arun Gupta in the photo caption. The error is regretted.

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new

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'Fo F cus on GroominG CIOs' Fo Well, we’re a fortnight into 2007, which means it’s time to revisit those New Year’s resolutions from 2006 and delete them (or pretend they never existed). Or we could drag them forward into 2007, as part of our ongoing guilt list with no specific deadline. If you’re a CIO, you probably have a conventional list of annual resolutions ('deliver more business value'). But, you may also want to take a look at Gartner’s new year resolutions for CIOs, which focuses this year on so-called high-value sidebar actions that will supposedly complement your conventional list. This is the soft stuff: flossing for CIOs. And Gartner picked a pretty interesting mix this time around, grouped into three buckets: things to start doing, things to do more of, and things to stop doing. Here’s a quick rundown: Things to start doing: First, “Create an IT generation succession plan.” Focus on Generation X (born between 1963 and 1978) and lay the foundation for your IT shop. You also need to get more women in the mix, because IT needs to be more collaborative. Second, 'Start tracking the environmental performance of IT.' Be part of the solution on this one, before you’re seen as part of the problem. Third, enable 'true innovators' within your organization. Use 1 to 3 percent of your budget for creative, risk-tolerant initiatives, Gartner suggests. (Continued on Page 18)

ILLUSTRaTIOn By anIL T

LEADERSHIP

Keep IT Simple Simplicity is the key to better IT, according to a recent study by The Hackett Group consultancy. Even though world-class IT departments spend 7 percent more per end user on IT than their peers, they return more to the bottom line through reduced back-office costs, according to the study. These topnotch IT departments accomplish this in part by reducing architecture complexity. That a streamlined architecture can improve IT operations isn’t a new idea. But Scott Holland, senior director with Hackett, found that this practice, among others that promote good IT governance (such as the use of project management offices and service models such as the Information Technology Infrastructure

MANAGEMENT REPORT

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Library, ITIL), contributes directly to financial performance. In companies with worldclass IT departments, back-office functional groups such as finance, human resources and procurement were able to save between Rs 9.45 crore and Rs 24.75 crore for every Rs 100 crore in revenue. Meanwhile, the cost of operating these functions, as a percent of revenue, is at least 13 percent and as much as 45 percent lower than at other companies. One key factor: “World-class companies buy enterprise systems at the functional level,” notes Holland. While Holland acknowledges that it could be a stretch for a mid-market company to invest in an ERP system, “there’s a price to enter.” Hackett defines world-class companies as those that fall within the top quartile of

the consultancy’s benchmarks for efficiency (based on use of resources) and effectiveness (based on skills and processes). In its analysis of data from about 200 companies, Hackett found that the best performing IT departments deployed 31 percent fewer applications for every 1,000 end users. They were also much more likely to be operating a single ERP system, especially for financial management. Simplification of the IT portfolio extends to the technology infrastructure. The top IT shops also use fewer development platforms, fewer databases and operate fewer data centers per 1,000 end users.

— By Elana Varon REAL CIO WORLD | J A N U A R Y 1 5 , 2 0 0 7

resolutions

For the CIO

(From Page 17)

D A T A C E N T E R S IBM will license its technology for cooling servers with water instead of air to Panduit, a global networking and electrical manufacturer, hoping to encourage adoption of IBM energy-saving techniques for data centers. Panduit will license IBM’s Rear Door Heat eXchanger, a 5-inchdeep cooling door that mounts on the back of a conventional server rack. Water courses through the door, cooling the processors in the server hardware. IBM’s water-cooled system reduces server heat output in data centers by up to 55 percent, compared to air-cooled technology, says Tom Bradicich, chief technology officer for IBM’s BladeCenter and System x server product lines. The heat exchanger is part of IBM’s CoolBlue portfolio of products aimed at slicing data center energy costs. Data center operators have been slow to embrace the idea: “It’s difficult to do water cooling inexpensively,” Bradicich says. But in the past 18 months, the number of servers used in data centers “has been getting extremely out of hand,” he says. As electricity bills for cooling grow, water-cooled solutions become more viable. Some CIOs now give water cooling a closer look, though they still have some reservations, says Michael Bell, a Gartner analyst. Water cooling can be initially more expensive to introduce into a data center than air cooling, and IT managers worry about water systems leaking and causing damage, Bell says. Some CIOs are sticking their toes in the water cautiously—clustering their highestpowered servers into one part of the data center and introducing water-cooled technology only in that area. As power bills grow, Bell says, water usage will rise.

Things to do more of: First, re-establish your visibility into total enterprise IT spending. We’re back in a growth phase, Gartner concludes, where shadow IT spending tends to proliferate. Second, help HR become strategic. Empower them with social networking, collaboration, and so on — tools to use talent as a strategic weapon. And third, 'improve front-line business experience.' Make hands-on exposure to business operations mandatory for your whole team, suggests the report. Things to stop doing: Stop giving back budget savings! Apply them to IT priorities elsewhere and report IT yield back to the business as your key yardstick, not cost savings. Stop treating IT governance as an elaborate process and focus more on the people side of governance — winning hearts and minds. And finally, stop obsessing about the minutiae of technology and find ways to deflect or redirect these time-sucking conversations before they happen. Having said that, Gartner also suggests getting hands-on with the following technologies in 2007: 3-D printing, social information analysis tools, newer high-level programming languages (such as Flapjax and Phrogram), and virtual communities such as Second Life. Overall, I like the 'think different' feel of these Gartner resolutions, even if they are a bit apples and oranges, and maybe not practical for every CIO. Maybe you won’t get to all 10 this year, but remember, this is the optional list, the little something extra. Don’t forget your primary 10; keep the lights on, the trains running, and the network up. And don’t forget to floss.

—By Robert Mullins

—By David L. Margulius

IL LUSTRaT IO n By MM S HanIT H

Throw COLD WATER on Costs

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TRENDLINES

New Year

trendlines

Keeping Track, the

Open Way

An open source wireless tracking system for following people around buildings got its first public use last week at the Chaos Communication Congress in Berlin. The creators of the OpenBeacon system sold 900 tags at Rs 585 each to attendees who volunteered to be tracked during the four-day event. Some attendees bought multiple tags to experiment with later. OpenBeacon uses chips that transmit and receive over the 2.4GHz frequency, which is available for unlicensed use in many countries. At the conference, the chips communicated with nearby base stations which sent data back to a central server. There were 23 base stations positioned around the conference center. OPEN SOURCE

The developers of OpenBeacon worked with partners to create a 3D model of the conference center, and anyone could use touch-screen monitors that displayed the location of attendees. Touching an attendee on the screen displayed a profile that the person could voluntarily add. The OpenBeacon team used the congress as a showcase for the tracking technology and its implications. An analysis of data collected over days could lead to assumptions about relationships between people who may have gathered in similar spaces repeatedly, noted Milosch Meriac, one of the creators. “We wanted to make this analysis transparent, so that people are more aware of what data they’re willing to give away,”

LIFE TECH Researchers at the Computing and Communication Center of the Technical University of Aachen in Germany hope to reduce the level of error in surgical operations. With the plastic surgery, hand and burn surgery department at the university hospital, they have developed a prototype virtual operating room to help surgeons learn operating techniques and also prepare for difficult procedures — with no risk to patients. Virtual operations can enable frequent, thorough training at all levels for faster, safer and more cost efficient surgery. This is the aim of computer scientists and surgeons cooperating in the Virtual Reality Surgical Training project. The “trick” of performing a virtual surgery is to simulate a realistic operating environment, according to computer scientist Torsten Kuhlen. That means creating not only a near real-life virtual operating theater but also virtual patients and all their various organs, bones, muscles and tissues. For virtual operating to be a useful learning tool, surgeons must be able to view the entire body, down to the various layers of skin.

he said. On the last day of the conference, OpenBeacon released all the data gathered over the four days. There are many types of commercial systems that could be used for tracking people or things but Meriac hoped to solve several shortcomings in those systems. He and a friend initially developed OpenBeacon after looking for a possible way to solve crowd control problems. They decided that RFID wouldn’t be very helpful because the tags can only be read by passing through gates. Requiring millions of people to funnel through specific areas might only exacerbate the problem.

— By Nancy Gohring

To create a realistic feeling of using a scalpel during surgery, they also need to sense the skin’s resistance to cutting. And not only that, they need all the action taking place during a virtual surgery to happen fast — ideally in real time — to make the situation realistic. In the prototype virtual operating room developed by researchers of the Computer and Communication Center, surgeons wear special glasses, allowing them to see not only a virtual operating table but also a holographic image of a patient lying on top. The image is created by a video beamer installed in the table. To relay the skin’s resistance to basic manipulations such as pinching, cutting and dissecting, the Aachen team has developed a robotic device that holds the scalpel. The computer scientists have developed complex algorithms to emulate a wide range of tissues, such as fatty and glandular tissue, and pectoral muscles. They have also developed a complex, ultra-fast mathematical rendering of realistic skin layers to correspond with incisions in real time. —By John Blau

Virtual Surgery Pardons Mistakes

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trendlines

30 Books to Make You a Better Leader C A R E E R A single book might not help you discover your inner leader, but 30 books can change your life. That’s the premise behind the Regional Leadership Forum’s (RLF) 2007 book list. RLF, a nine-month program of individual work and group sessions presented by the Society for Information Management (SIM), fosters leadership development in part through book discussions. (For the complete RLF reading list, see the online version of this article at http://www.cio.in/features/ viewArticle/ARTICLEID=2666) The forum focuses on individual growth and business intelligence, not technical acumen, says Bob Rouse, director of RLF and professor of computer science at Washington University. Hence the list includes Two Old Women by Velma Wallis and Viktor Frankl’s Man’s Search for Meaning. Reading beyond the business section is a lifelong learning skill that the forum stresses, notes Rouse. Case in point: Since graduating from

RLF in 2002, Jim Noga, VP of IT at Massachusetts General Hospital, has given managers books from the updated list each holiday season. RLF adds six new books each cycle. New titles include Michael Marquardt’s Leading with Questions, Patrick Lencioni’s Death by Meeting and Kazuo Ishiguro’s Never Let Me Go. Those who find the list’s length daunting may want to follow the lead of Michael Pellegrino, CIO of Fuji Photo Film USA. He read up on speed-reading prior to the forum, which involves six two-day sessions and nearly 8,000 pages of reading. “I started the program on the first day thinking, ‘What am I doing here? I don’t know if I can keep up with this work’,” says Pellegrino. “On the last day, I thought, ‘This is one of the greatest experiences that I have ever had, and I don’t really want it to end’.” So it didn’t. Pellegrino and his peers created an extension program, which included several, albeit fewer, books. — By Lauren Capotosto

Weighing the Cost of Compliance From Sarbanes-Oxley to HIPAA to PCI/DSS, chances are your company is subject to myriad compliance requirements. And although the goals of such regulations are noble, the chunk taken out of your security budget to uphold them is considerable, in some cases precluding stronger, more tangible computer security protections. In other words, by spending heavily on the letter of the law, you may be putting your organization at risk. Stephen Northcutt, director of the SANS Institute, a computer security training organization, agrees that IT’s ongoing emphasis on compliance may be worth reconsidering. “It’s an audit mentality, not a security mentality,” Northcutt says. “It’s, ‘Let’s do everything we can to meet a checklist of audit requirements that in the end do not guarantee or measure real security.’ The audit requirements and SECURITY

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regulations are generally too broad, with gaps and overlaps. And when the first audit is over, the team switches into another, entirely different mode to satisfy the next audit, which requires different objectives.” Most companies fall under multiple regulatory laws with overly broad descriptions of what is secure. Whether you pass or fail a particular audit requirement is up to the discretion of external auditors. Not surprisingly, pleasing auditors often has little to do with sound security practice. Robert W. Hodges, information security officer at Bon Secours Health Systems, says, “When we get two conflicting or overlapping regulations, we play it safe and take the most conservative, secure approach. That way, it satisfies both requirements.” But always taking the most conservative approach means higher spending — in many cases, more than is necessary from an overall

security perspective. Regulatory clarification would help. Discretionary guidelines are often given specific answers in court. But with regulations showing more bark than bite despite the fact that most organizations are not fully compliant, you have to wonder where to draw the line when financing compliance efforts. After all, continually redirecting vast amounts of IT dollars and attention away from other practical security projects in order to remain compliant could prove considerably more costly down the line. Your only solution, however, may be to hold your nose as you overspend. As Hodges puts it, “Who wants to risk their company being the defendant when the government decides to make a test-case example?”

— By Roger A. Grimes

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Collaboration at Work M A N A G E M E N T Want to learn the latest management theory on collaboration? Then log on to an Internet fantasy role: playing game and create your own 3-D avatar. That’s what Jack Emmert, creative director for Cryptic Studios in California, advises. Emmert created the hit game City of Heroes, in which thousands of online players dress and arm their 3-D superhero avatar characters to do battle against thugs, robots and monsters. The twist: The best way for players to advance to the next level is to collaborate to vanquish criminals. Emmert programmed incentives into the game to encourage teamwork and continued subscriptions. In online Executives can use similar games, if incentives, Emmert says, to a reward encourage collaboration at work. is clearly His advice: relevant to Foster Individuality. In the character, games, if players can express their players will individuality (by say, choosing play longer. special clothing), they also will want to join a group to express the group’s formed identity. In the workplace, give those executives with the most to gain from a successful project the tools to design and personalize the new system. “Let them make it their own,” Emmert says. provide frequent rewards, and praise groups. Game designers provide some type of reward to players every 90 seconds on average to keep players engaged in the game. In the workplace, provide small rewards frequently (monthly perhaps) that not only keep workers engaged in a project but also reward group behavior. Make rewards personal. In online games, if a reward is clearly relevant to the character, players will play longer. Give rewards that reflect an employee’s personal tastes or lifestyle. “People don’t like to be told to be in a group,” Emmert says. “You have to create the incentives and rewards that will make it their decision that working in a group works to their advantage.” S TA F F

| ESSENTIAL TECHNOLOGY |

A Diet for the IT Power-Hog Concern over power consumption is driving enterprises to alter their computing practices, according to a Canadian analyst. Read more of such web exclusive features at www.cio.in/features

Columns A Good Offense is a Good Defense Why it pays CIOs to map their plays before a dictate to outsource comes down from above. Everyone Gets to Play Good IT governance is not about committees, processes, forms and procedures. It’s about involving as many people as possible. And then it’s IT’s job to support them. Read more of such web exclusive columns at www.cio.in/columns Resources Closing Windows, Opening Doors Revenue for Windows and Office has remained relatively flat, while the server and tools division has posted doubledigit revenue growth for 16 straight quarters. Download more web exclusive Resources from www.cio.in/resource

COLUMNS

TOP VIEW

GOVERN

Provocative Predictions for 2007 We asked some industry leaders and IT executives for their boldest predictions about the future of IT

FEATURES NEWS |

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RESOURCES

WebExclusive

—By Meridith Levinson 22

Features

REAL WORLD

Martha Heller

Career Counsel

Cue the Spotlight How the CIO can achieve a measure of fame and celebrity in four simple steps.

Illust ration p c anoop

ou’re doing a bang-up job at work. With your data consolidation project and new sourcing strategy, you’ve reduced operating expenses by 40 percent, and your new PMO has put smiles on the faces of all of your colleagues. It’s only a matter of time before your fabulousness becomes known and recruiters start calling with your next dream job. (If you believe that, I have a nice bridge in Brooklyn to sell you.) The fact is, like most rewards, industry recognition takes some hard work. Yes, if you are the CIO of GM or Dell, recruiters know your name, and magazines, newspapers and conference organizers are beating a path to your door. But if your company is not a household name, you need to take a proactive approach to making a splash. I spoke to four CIOs who take the concept of strategic selfpublicity to heart, and together we have developed four simple steps to worldwide recognition. 1. Branding. Before you can get your name out there, you need to have a clear understanding of just what that name represents. Are you great with customers, a terrific leader, an architecture guru, or a manufacturing expert? Knowing your brand will allow you to project attributes that are richer and more powerful than those associated merely with your job. Last December, Michael Iacona decided he was ready to raise his visibility within his industry. But first the CIO of TMP Worldwide Advertising & Communications thought about what he wanted his name to connote. To focus his thinking, he went through an exercise to identify his personal brand. Iacona sent a survey to his peers, colleagues and even people he had just met to determine the impression he makes. A

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Martha Heller

Career Counsel

sample question: if he were a car, what kind would he be? From the survey results, he learned which five brand attributes best describe him and used them to develop a one-page summary, a personal mission statement and a webpage to advertise it. “This is not about creating an image of who you want to be, but identifying the unique value that you bring,” says Iacona. But just like running IT, building your brand is not a one-time project. “This is not something you do once and are done,” he says. “Over time, you need to continue to build and nurture your brand.” 2. Networking. With your brand in hand, you can nearly see your name up in lights. Well, take a breath; it might make sense to start networking first. This lets you test out your brand, hone it while the stakes are low and meet people who can connect you to relevant editors and conference organizers. “Networking is not just hit or miss,” says Sheleen Quish, former CIO of US Can and current CIO-at-Large of Box9 Consulting. “You need a great address book and a plan for growing it. I spend at least 30 minutes a day adding new contacts to my list.” 3. Writing. A time-tested way of garnering attention is to write for a technology or business trade magazine. In 1992, Greg Smith, now CIO of World Wildlife Fund and author of Straight to the Top: Becoming a World-Class CIO, decided to get published. He was in corporate financial systems at Sallie and had completed a cutting-edge technology project. He wrote an article about it and submitted it to LAN Times. The editors teased it on their cover, which led to speaking engagements, articles, a book and book signings. Smith’s advice: “Take a shot, write an article and submit it to a bunch of publications. Start with a controversial idea and make sure you include practical advice. You want to give readers at least one memorable idea when they walk away.” 4. Speaking. For many CIOs, few things are less appealing than appearing before an audience. But it’s one of the most effective ways to get known. “Start by tapping into MBA and executive education programs,” says Mary Finlay, deputy CIO of Partners HealthCare System and a frequent speaker at industry events. “They are always looking for guest speakers. Also, if you are in organizations like SIM, you can offer to speak at their events. But reference your membership as you reach out to other events. Conference directors often want to hear from someone who represents an organization.” Once you get the gig, customize your presentation to the audience’s expectations, test it for delivery and timing, and connect with your audience. If they like you, word will spread, and you’ll be a regular on the speaker circuit. So, there you have it: you’re branded, networked, in print and on stage. Your worries are over, right? Not necessarily, cautions Quish: “Don’t blow your 15 minutes of fame all at one time. If you get too much exposure, you can become like stale bread.” 24

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The Last Word Readers told me that they valued the column’s advice for getting on the speaker circuit. However, many wanted to learn more about how to make each presentation a success. I recently heard an excellent talk by Rick Davidson, CIO of Manpower. I asked him to share some of his best practices for on-stage success. “Think of your presentation as a story,” says Davidson. “Give it a beginning, a middle and an end.” The beginning is the hook, “the part of the talk that ignites the audience’s initial interest in the topic.” Davidson says the middle is where you allow listeners to relate the topic to themselves and provide them with opportunities to consider what it means to them. The end is a call to action: what am I — or we — going to do about the situation? As a CIO speaking to a non-CIO audience who will not immediately relate to your experiences, you need to demonstrate that you understand their perspective. “I spoke to people who work in project management offices and talked about their roles as ‘speed bumps on the road to chaos,’” says Davidson. “They decided that I understood them and agreed to listen to me, even though I’m in a different professional role.” Creating an emotional reaction in your listeners — telling a personal story or funny anecdote — will establish a connection with the audience and keep them engaged, says Davidson. In the talk that I heard, Davidson told a story about how when his father retired, his mother made his father stay in the garage all day so as not to disrupt her domestic space. (This gave me a wonderful idea for my husband’s retirement one day.) Davidson’s final advice? “Avoid too many messages,” he says. “If you overload your listeners, they won’t retain anything. Sometimes, all your audience will remember is a picture or a single message. What are the two or three points you want them to take away? If they walk out with those, you’re successful.” CIO — M.H.

Martha Heller is managing director of the IT Leadership Practice at the Z Resource Group, an executive recruiting firm based in Boston. Send feedback on this column to editor@cio.in

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Bill Regehr

Peer To Peer

Fear of Dependency Small- to mid-size organizations, using small- to mid-size vendors, must always be ready to break away and stand on their own two feet.

Illust ration MM Shan it h

he technology leader’s challenge is to provide business tools and solutions as efficiently as possible in a world of limited resources. That’s the case no matter the size of your organization, but it’s especially true when you’re a small- to mid-size enterprise. Our budgets receive closer scrutiny; even low-cost line items must be justified. Technology staffing is weighed against the cost of staffing the mission of the organization. At Boys & Girls Clubs of America, we have an IT budget of Rs 13.5 crore with a staff of 25 full- and part-time employees supporting staff in 27 states. We also have 2,000 technology centers with 20,000 (donated) PCs. As we’re a non-profit, adding to our staff is especially difficult because we have to raise the funds to support those salaries every year. As one of the fastest-growing major non-profits in the country, we live in that tense middle ground between the development and support needs of a large organization and the realities of our mid-market budget. To walk this high wire safely, we’ve adopted a sourcing strategy that takes into account our limitations. In short, we buy when possible, build when we must and support in-house. As corollaries to that strategy, we strive to avoid becoming too dependent on any of the third-tier vendors we generally have to deal with. We routinely leverage platforms and staff across multiple applications, and we take a limited view of business process outsourcing. Our initial approach to any solution is to see if applications already exist that could meet our needs. We opt for common platforms, leaving exotic solutions to those who are able to make the high-cost investment in the support they require. Any software platform we choose must be interoperable with 26

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Bill Regehr

Peer To Peer

other applications and have the capability to support multiple applications. That leverage is a critical component of any new application business case.

The Vendor Trap If a suitable solution is not commercially available, we look for an outside developer. This path can be problematic. On the plus side, an outside developer frees us from having to grow the inhouse staff to develop the applications. On the other hand, we run the risk of becoming dependent on the developer. For the small- to mid-size enterprise, finding affordable tier-one or tier-two vendors is a challenge, and many of us are forced to use third-tier players that are, by definition, small and often not as well-managed as their larger brethren. Let me illustrate with a generic scenario. We award a contract to the low bidder, a small firm with a few key developers. Call it Vendor A. Vendor A is easy to work with and wins over our users by incorporating 'nice-to-haves' into the application spec. As new apps are needed, we continue to use Vendor A based on its pricing and the nice relationship we have with him. Indeed, it now feels like part of our organization. As we grow, the time comes to upgrade some of our platforms. Simultaneously, Vendor A’s developers experience a series of challenges, both personal and professional. They become distracted, less reliable and sometimes unavailable. They can’t keep up with the work they have and can’t meet our new requirements. But they’re the only people who understand how their applications work, and we find ourselves depending on a vendor with no resilience or bench strength. If you find yourself traveling down this path, stop everything: find a way to expand in-house, and get third-party support for your critical applications. It may take time (even years) to extricate yourself, but whatever it takes, be diligent about pursuing a multi-vendor portfolio. As CIO, it’s critical for me to convince the organization how important it is to maintain a healthy degree of independence from any single vendor. We can’t allow ourselves to be victimized by unforeseen disasters or dysfunctional business relationships. In addition, we’ve learned that periodic code reviews must be completed at set milestones in each development project to ensure both the quality of the code and the clarity of the documentation for the application in the event we will need to support it ourselves.

The in-house staff of smallto mid-size organizations generally perform multiple functions — with enough efficiency to support the needs of the business. costs by requiring each member of our team to support multiple applications. Last, for a few specialty applications or communications needs, we outsource the entire process. In doing so, we are able to off-load the development, support and delivery of unique applications with the option of bringing them in-house later, if we’re able to do so cost-effectively.

The Limits of Outsourcing Beyond that, outsourcing has a limited role in our IT strategy. While some might argue that business process outsourcing best serves the needs of the small- to mid-market segment, most often these processes support highly specialized and/ or unique business solutions, which, in turn, call for highly customized processes. To be sure, there are some processes that might be outsourced, but the financial benefits are often negligible. As I’ve mentioned, our in-house staff generally performs multiple functions — not with the degree of expertise of an outsourcer’s specialized staff, but with enough efficiency to support the needs of the business and at a cost that most outsourcers cannot match. Further, the volumes involved in these smallto mid-size environments are not sufficient for an outsourcer to justify creating a competency center. The key point is that it’s critical for those of us in the smallto mid-size space to advocate on behalf of the enterprise in ensuring that the infrastructure and applications are created and supported in a manner that will position the organization for growth with minimal risk. The strategy we choose in sourcing will play a significant role in determining the ability of the business to deliver to its customers. CIO

Why Support Begins at Home When it comes to supporting applications, we default to inhouse maintenance. We must be in control of our own destiny for certain applications. These include CRM, ongoing website development and our central database. In an organization of our size, it’s critical that ongoing in-house support be included in initial project budgets. We reduce our in-house maintenance and support 28

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Bill Regehr is CIO of Boys & Girls Clubs of America, based in Atlanta. He is a member of the CIO Executive Council, a former IT executive with Equifax and IBM. Send feedback on this column to editor@cio.in

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Cover Story | Leadership Lessons

Ones B Y V i j ay r a m a c h a n d r a n

Watch to

Honoring the CIOs of the future and the IT leaders of today.

hat is leadership? That question and its companion — how best to lead? — must be answered by CIOs as they prepare the next generation of IT leaders. We all know leadership when we see it. And note its absence easily. But separating leadership into its constituent elements isn’t so simple. What we know for certain is that leadership development is an imperative. CIOs need leaders in the ranks. And the most successful CIOs take an active role in cultivating leaders. So the CIO Ones to Watch 2007 program not only honors the 25 executives who have shown that they have what it takes to be tomorrow’s CIOs, the awards are also an acknowledgement of the personal commitment to fostering talent shown by their CIOs. The question is: how do you become a person others want to follow? Start by being yourself, say CIOs, who share the secrets of their own leadership success in ‘The Right Stuff’ (Page 30). Play to your strengths. If you’re a hands-on person, be a hands-on leader. If you’re not a rah-rah type, don’t fake it. Find another way to inspire the troops. All the Ones to Watch honorees excel at leadership. The winners say that change management, team building and business strategy were extremely important in their rise to the top. To recognize the components of well-rounded leadership and to honor the individuals who exemplify them, CIO has profiled three executives from this year’s crop of Ones to Watch winners who have mastered these skills (‘Master Class’ Page 36). We examine the demands each of these honorees faced within their company and explore how they applied their special talent to resolving a problem or confronting a challenge. Interestingly, they all stressed the need to develop soft skills in their bid to rise to the next level. “The success of a CIO depends, to a large extent, on his ability to build bridges with his peers and other important colleagues,” points out P.S. Narayan, GM, Wipro. Congratulations to all the winners and to the CIOs who nurtured them. And from the Ones to Watch Class of 2006, we have a few members who have graduated to the next level. Kudos to them.

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Cover Story | Leadership Development

The Right

Stuff What does it take to make the leadership leap? Do you have what it takes? By Balaji Narasimhan

Cultivating your leadership skills and those of your staff How to develop skills in your IT department

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CIOs on the critical elements of leadership

Imagin g by an il t

Reader ROI:

Photo by Sr ivatsa Sh an dilya

xperience possesses immense power, believes S. Hariharan. The past, says the senior vice president (infrastructure services and support group) of i-flex Solutions, has a hand in molding present-day thought. And in many ways, his experience has pointed to the value of playing IT by the ear. Take for instance Hariharan’s approach to his IT organization. He adopts a hands-on approach in certain areas and delegation in others. Delegation is crucial when people need to be empowered and shown that they make a difference to the organization. Not very far away from i-flex Solutions’ headquarters in Mumbai, the IT department of Reliance Industries is founded on one approach: delegation. Ashish Chauhan, president & group CIO of Reliance Industries, asserts that a CIO’s role is largely about empowering his team. In a large organization like Reliance, a hands-on approach won’t always work, he says. Hariharan and Chauhan’s leadership approaches couldn’t be more different. Yet, both have reached the top and managed to thrive there. How? It comes down to knowing the leadership style that best suits them — and staying true to it. If you are a hands-on person, be a hands-on manager. If you are naturally enthusiastic, use the enthusiasm to motivate your troops. And if you are a quiet strategist, don’t try to manufacture false rah-rah; focus on strategy instead.

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S. Hariharan, Sr. VP-infrastructure services and support group of i-flex Solutions, says a situation must determine if delegation is appropriate or a hands-on approach is better.

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Cover Story | Leadership Development

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For some, the taste of IT started even earlier. K.B. Singh, head of IT at BSES Power, says, “During my Masters’ studies in North America in the early 1980s, I saw how developed countries used information technology for business advantage. I felt that a country like ours could also benefit from this kind of approach. But at that time, the IT base in India was very poor.” Today, in India, he is doing exactly what he wanted to do. Of course, not everybody gets into IT right from when they were in college — Amit Mukherjee, group CIO of RPG Enterprises, says that he got a solid grounding into IT while working with Tata Steel and other companies in the early 1990s. It points again to the power of experience. While all these IT leaders have had diverse backgrounds, they all agree that their initial grounding helped a lot when they became CIOs. “My early experience in various IT organizations has given me immense knowledge in my current role as i-flex’s CIO,” avers Hariharan. Chauhan seconds that observation: “Early experiences during my education of working on cutting edge of technology and subsequent opportunities of applying the knowledge and learning new techniques has been something I have always cherished.” With Singh, it has been “a combination of early work experience and constantly updating myself, that has extremely useful in shaping my career because technology evolves very fast.” Mukherjee also attributes his success to his work in shaping his nature, and feels that it was “very important.” These diverse backgrounds have given CIOs their own understanding of success and failure of IT projects. “We may call it failure or adjustment for the business advantage,” says Singh. In many cases, Mukherjee notes, perseverance and modifications have converted failures into success. A more pragmatic Hariharan feels that failures are an inherent part of the learning-and-growth process. “In retrospect, one learns more from failures than from successes,” says Chauhan. Regardless of what these IT leaders feel about failure, they are unanimous in the belief that fear of failure apart, risks have to be taken. While taking risks is important, Ashish Chauhan, one should take calculated risks backed president & group CIO by a proper risk mitigation strategy, says of Reliance Industries, Mukherjee. It is something Hariharan agrees says business interaction with. Chauhan notes that “doing nothing is and buy-in are of utmost also about taking risk.” The only person who importance at all levels. doesn’t believe in any such thing as risk is

Every CIO needs to find his or her own leadership style. But getting to the top also requires the ability to recognize and capitalize on opportunities to hone what you’ve learned, say the CIOs who nominated the winners of the 2007 CIO Ones to Watch, which honors senior staff poised to become tomorrow’s IT heads. Hariharan believes that much of his growth coincided with i-flex’s expansion plans. “With multiple locations and numerous offices, the challenge was to provide IT infrastructure that enabled business,” he says. Chauhan, on the other hand, had his first taste of IT when he was part of a five-member team that set up the NSE around 1992. “In those days, I set up the first Indian commercial satellite network for NSE which is still amongst the largest in the world,” he points out.

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Cover Story | Leadership Development Singh: “There is no risk when there is a vision to carry an IT initiative till the end.” The implication of the stream of thought that emerges from these beliefs is that before taking risks, one should become familiar with the areas of business, particularly with respect to those aspects that do not fall within the ambit of IT. The four CIOs we interviewed feel that it is critical to understand all the areas of operation. Chauhan here seems to be the most vocal champion of technology. “IT is the only glue that binds large organizations, and facilitates the organization to behave as a single entity,” he points out. This naturally begs the question: should IT executives, in order to gain better exposure, move from company to company? An emphatic no. It is better to move around within the existing company and gain exposure rather than hop from one job to another. Says Hariharan, “In a large organization, an IT executive may develop skill-sets by just being within the organization and playing different roles.” Evidently, developing a keen understanding of the business is more fruitful than visiting job-related websites. It’s unsaid in IT organizations: CIOs must have a sound understanding of business to reach the top. In the context of business and technology, one question keeps popping up: should the CIO be more inclined towards business than technology? Hariharan and Singh feel that the CIO need not be a businessperson, but needs to understand business requirements and processes. Mukherjee, however, says that without business success, there can be no IT success. Chauhan agrees, “Understanding the business is of utmost importance. Without that, IT is like a body without a soul.” But while understanding business is one thing, communicating the role of technology — especially to the top management — is another. Mukherjee, therefore, feels that the CIO should don two hats and be able to discuss business with the top management and the nitty-gritty issues of hardware upgrades and software installations with his own tech team. On the other hand, Hariharan has a slightly different take. “Communication is through results. When a CIO shows results to top management in terms of IT helping to increase revenue and optimize costs, then it’s clear that the marriage of technology and business acumen works.” Chauhan, though, is worried about layers besides the top management. “At each step, the business interaction and business buy-in at all levels is of utmost importance.” In this respect, Singh sounds the happiest. “We have an IT roadmap to meet the business objectives. In each area, we have activities that are broken down to meet a defined schedule. In our case, IT is aligned with business objectives, and our management is also tech-savvy. Therefore, this task is much easier.” In spite of this, he admits that “there is always pressure on achieving milestones and measuring benefits.” One way in which a CIO can achieve his milestones is by building skills related to various areas of business. Chauhan is clear about how this should be done, and, with a touch of

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Class Act

How to create a training program for IT staffers to focus on technology leadership.

lthough general leadership-training programs already existed at American utility giant Southern Company, R. Bart Wood, CIO of Southern’s Georgia Power operating unit, and other members of the senior leadership team recognized that they needed to provide IT staffers with opportunities to focus purely on technology leadership. To this end, they launched a 24-month IT leadership program. The selection committee, consisting of the corporate CIO, the executive sponsor of the training program, the vice president of IT, a representative from HR and an employee with experience in leadership development, selected 25 participants after reviewing a group of candidates nominated by senior IT leaders, attempting to represent as many of Southern’s geographies and functional areas as possible. A unique aspect of the program is that one of its openings is designated for a non-IT staffer who has expressed an interest in IT. Classes meet one or two days a month and are taught by both internal and external experts. As the group enters the second year, participants will shift from classroom-based learning to group projects and mentoring by senior IT leaders. Wood takes on six of the 25 participants for group mentoring once a month. “I have no doubt that the level of exposure they receive in terms of the classes and small-group projects helps to better prepare participants to be more competitive and ultimately successful,” he says. Although it’s too early to measure benefits in terms of promotions, the management team has already seen an improvement in communication skills and increased idea-sharing and networking among the group. – Carrie Mathews

reverence, says, “I have found this to be the most effective way of learning business skills at the feet of the masters of the business.” Mukherjee, who honed his skills on project management while working for Reliance Industries earlier, feels that management of resources and third-party vendors plays a crucial role in business. Hariharan has gone about the same by building both technology and management skills in his IT department. Training has been an important formal channel to achieve proficiency in both, he says. What does the CIO do then with these skill-sets: does he become a change agent? All the IT leaders we interviewed feel that this is what a CIO was born to do. “Being a change manager is very important, and should be administered along with business innovations and initiatives that help business the most,” says Singh. In fact, Mukherjee believes that a CIO REAL CIO WORLD | J A N U A R Y 1 5 , 2 0 0 7 3 3

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Cover Story | Leadership Development

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“We need both a top-down and a bottom-up approach to convince everybody, and at times, some amount of force is also required,” says Mukherjee. However, he is quick to point out that there is a carrot-and-stick approach at work: convincing the end user that there is something in it for him is one of the best ways of ensuring end user buy-in. Of course, cajoling the end user doesn’t always work. “There are situations where one can’t compromise (like system security and regulatory requirements), and the users are not given a choice,” says Hariharan. Such instances apart, users play a definitive role. Chauhan actually goes as far as to quip that one should involve users from the concept stage and incorporate some of the users as part of the overall strategic team for the project. “Insights and enthusiasm of these champion users will go a long way in providing requisite buy-in from management and end users,” he adds. Chauhan also believes in what he calls a rollout framework, which would provide the CIO with a tool to ensure that the benefits envisaged at the time of taking the management buy-in are realized in the field by handholding, training and motivating the users by showing real benefits to each user and the organization as a whole in a systematic and planned manner. In the absence of such a rollout framework, Chauhan warns, a project may be successful in the technical sense but not from the business perspective because users may not be enthusiastic or may not be able to keep pace with the speed of change of technology. Even Singh believes that the involvement of the user group during or post technology implementation is a key to success. He advocates a different tack, though. “It is advisable to first select areas where business advantages could be realized fast with IT implementation and this would generate confidence at all levels.” This comes with a caveat though: before doing this, the management has to be completely committed. And to get here, the CIO should do the internal selling of the project idea at a strategic level. Once the idea is sold, the management may require quick results, and to ensure this, K.B. Singh, “the IT implementation staff may have to head-IT of BSES Power, take extra pain,” explains Singh. says involving the user There is a benefit associated with this group during or post pain. It enables the CIO to get noticed when technology implementation the results start pouring in. Hariharan puts is a key to success. it succinctly when he says, “Results! Results!

is the most important change agent because he is instrumental in bringing about change with the aid of technology. Chauhan feels that the change a CIO effects in his organization should not be restricted to technology, but also include the larger ambit of business. “The most effective way to usher a change is to make it least painful for everyone concerned, and still ensure that the organization progresses in overall use of technology for the benefit of the business it is serving.” Towards this end, Hariharan says, “The change must be enabled through efficient IT processes, applications that streamline business operations, and technology that is constantly evolving to benefit business.” But change is not possible merely with the blessings of the top management — the active involvement of the user community can determine if the project succeeds or fails.

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Results! Result-orientation must be a primary focus for any CIO. For this, the CIO must realize that he has to be in close touch with technology and business. Only in this way can results be ensured.” He also warns that, since a CIO is usually bound to get noticed when there is a failure as opposed to when the implementation is successful, he should take special pains to minimize failure, which can result in negative internal publicity. Mukherjee, who is all for a handson approach, feels that in order to get results, a CIO should pilot a large project that changes the face of the organization and handle the project all the way from ideation to implementation. This way, a CIO can get to understand the various facets of business and his interaction with the management and the user community will also develop further. This has a double benefit — the top management begins to trust the acumen of the CIO and users too learn to respect the CIO as a senior person who can deliver business solutions. Handling a large project involves team spirit, and Singh seems to believe that even this helps because the CIO then learns how to manage technology, the top management, the end users, and his own team more effectively. A CIO should “get into the business processes, make an IT implementation that delivers the maximum business advantages, build a formidable team and align IT with the business objectives,” he asserts. Chauhan rounds up averring that “the CIO has to work continuously towards providing world class solutions to business. He has to understand business in detail and master technology. Anticipation and flexibility in terms of business processes and technology are very important because these differentiate a good CIO from a not-so-good CIO.” Shakespeare said it best: “To thine own self be true.” Don’t change who you are just because you are now the head honcho. CIO Additional inputs by senior writer Ben Worthen. Special correspondent Balaji Narasimhan can be reached at balaji_n@cio.in

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How to Make It CIOs on what their winners must do to make the leap. S. Hariharan, Senior VP-infrastructure services & support group, i-flex Solutions What he looks for in a protégé: Vision and the ability to carry the organization forward. Ones to Watch winner: Ravikumar Muthuswamy, VP-facilities management group and technology deployment management. Why I nominated him: Ravikumar has had extensive experience in the IT infrastructure field. He has had experience in managing i-flex’s infrastructure from the beginning and has an excellent perspective of how this infrastructure needs to grow to enable our business. What he needs to do to become a CIO: "Ravi has acquired all the skills necessary to be a CIO. He has seen our IT infrastructure grow and become a key enabler."

Ashish Chauhan, president & group CIO, Reliance Industries What he looks for in a protégé: A leader with excellent understanding of technology and business. Ones to Watch winner: Bharat Sethi, VP Why I nominated him: Sethi is amongst the top IT leaders in the Reliance group who has several successes to his credit. He has been able to motivate a large team to provide world-class solutions to Reliance group and keep them motivated. What he needs to do to become a CIO: “Today, he is more than a CIO. He is responsible to provide businesses with very complex but easy to use solutions.”

K.B. Singh, head of IT, BSES Power What he looks for in a protégé: Insight of business processes and ability to align IT with business objectives. Ones to Watch winner: Anish Kalucha and Prasenjit Mukherjee, IT managers. Why I nominated them: Anish is a hard taskmaster, team builder, and takes his team to achieve the targets. Prasenjit has the ability to visualize how the end user perceives a tech transformation. What they needs to do to become CIOs: "Anish needs to learn how to look across functions and how to deal with users in a more sensitive manner. Prasenjit needs to go deeper into business processes and leverage technology to derive maximum business advantage." Amit Mukherjee, group CIO, RPG Enterprises What he looks for in a protégé: Attitude, aptitude, and ability to push things with vendors, users and the management. Ones to Watch winner: Jitendra Kine, head-IT Why I nominated him: He has conceptualized a complicated and strategic SAP implementation, and has done it extremely well. What he needs to do to become a CIO: "Get involved in non-IT functions." — B.N. REAL CIO WORLD | J A N U A R Y 1 5 , 2 0 0 7 3 5

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Cover Story | Leadership Lessons

Master BY gunjan trivedi

Class What becomes a leader the most? Take a lesson (or three) from those who possess the skills and qualities a successful CIO must have.

Team builder. Business strategist. Change agent.

Reader ROI:

Why leaders must change with the times Three criteria that characterize the successful CIO Action items for each criteria

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ell-rounded leaders must be all these things — and more — to be successful in today’s fast-paced business environment. After all, leadership is not a static accomplishment. And neither are the skills required to do it well. In fact, the capacity for agile leadership in the face of shifting business challenges is practically a job requirement for CIOs, who have been whipsawed by changes ranging from the rapid growth of the dotcom boom to the need to slash services and operate on less when the bubble burst and the economy contracted. “As a CIO, you must be able to anticipate industry trends, how are they likely to impact the organization and what opportunities you can create out of them. Agility is important and agile leadership matters,” says Arun Gupta, director-IT of Philips Electronics India, and a member of CIO’s Advisory Board. What’s true for the CIO also holds for those who aspire to the title. During their rise to the top, all of our Ones to Watch honorees have stepped into the part of the business strategist, change agent and team builder as the needs of the business dictated or circumstances demanded. When the winds of change blow, leaders must be able to evolve to fit the times.

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Cover Story | Leadership Lessons

business strategist

manager expand his or her repertoire in order to round out leadership abilities, and harness such talent to help IT deliver the greatest value to the business. For a snapshot of what a high-potential business strategist, change agent, and team builder looks like, read on.

The Business Strategist When you’re in charge of a Rs 30-crore budget to support over 65,000 users like Narayan P.S. is, business strategy comes naturally to you. As a general manager and head of the information system group in Wipro, Narayan runs IT as a business, treating business users as his customers. Wipro’s CIO, Laxman Badiga, praises his lieutenant, “Narayan is visionary in approach. Based on belief that IT and business must partner as equals in delivering value, he forges strategic links with key business constituencies.”

Photo by S r ivatsa S ha ndilya

As the economy continues to grow and competition heats up, so do business demands on IT. Technology departments must deliver solutions with real value, and they must deliver them quickly. This means working closely with major internal and external stakeholders to develop relationships and trust in IT, as well as with the technology staff to keep workers energized and focused on where the business is going. So, team-building is high on the list of what a future CIO needs in order to get to the top. “To figure out who has a team builder trait, I would look at the way a potential IT leader communicates and is able to sell his ideas. Without the power to effectively communicate his viewpoints and an ability to understand and respond to other’s perspective he cannot be a CIO,” says Satish Joshi, executive VP, Patni Computer Systems. Technology departments today must be masters of handling transition as companies struggle to gain competitive advantage in the marketplace by aligning the business with IT. To lead others in a new direction or to influence the way people do their jobs requires acting as an agent of change. And that’s never easy. “The ability to manage changes is what makes a real leader. The effort tha goes into implementing best solutions will be wasted if you can’t get your people to work on the systems. The ability to effectively persuade and convince is critical here,” says Joshi. “Everytime we talk about change, people feel threatened. You have to be able to address change at each level within the organization. Most CIOs address it only at the top. This curtails its effectiveness. Hence, a CIO should communicate well and help others understand what is required,” adds Gupta. The future IT leaders rise or fall based on their success in managing projects and delivering results. Project management is a hot topic among CIOs, who named backlogs as their biggest hurdle to effectiveness. Philips’ Gupta feels that it is important for a CIO to understand the capabilities of his second line of command and give them some quick wins to improve their confidence. “If a person doesn’t taste success fast enough, he will face demoralization. CIOs should balance small projects with large ones. I give one large project to high potentials in my team, along with a few small ones. The smaller projects give them the quick wins and boost their morale and confidence to take on the large one,” he says. A CIO lucky enough to possess an IT manager with an aptitude for one of these roles needs to do two things: help the

Narayan P.S., GM & head-IS Group, Wipro, has ensured a 10-fold growth of business' involvement in defining IT's roadmap.

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Cover Story | Leadership Lessons

Vinay Khargonkar,

team builder

head-IT, Hazira Works, Larsen & Toubro, places his team in the spotlight to foster ownership.

consolidating and offering shared services to these divisions, Narayan conceptualized a plan with clear ROI and TCO, presented and sold it to management and the CFO. Wividus was eventually successful inincreasing efficiencies by synchronizing and standardizing business processes and technologies across the organization. The project recovered its set-up costs within a year and is today a case study for prospective clients. “The visible and valuable outcome of this exercise was that at the end we had one, unified, standard chart of accounts of Wipro,” he recalls. Still moving in business-strategist mode in his newfound role of an IT head, Narayan is heading a five-year strategic initiative called GloSTAR (Global, Scalable, Transformational, Agile and Real-time). This big-ticket program seeks to set up a foundation and build the next-generation of redesigned systems and re-engineered business processes over the next five years to meet changing business dynamics. An IT governance council comprising C-level representatives from business oversees this program. Narayan represents IT in the governance council meetings. The program defines a business blueprint for the future. With the initiative, which is the brainchild of the IS group, Narayan feels that the involvement of business in defining IT roadmap has grown ten-fold. “Without a good and sound understanding of all the business processes and how they are interlinked together, it is difficult to understand not only what the business is doing currently but how it will look in the future. Thoroughly understanding the current and future of your organization’s business is imperative if you want to design solutions that will stand the test of time,” he says.

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Tip: Learn the business and be part of it. Don’t stand on the sidelines and say, “Here’s IT work that needs to be done.” Instead, ask: "What are the business issues, and what do we need to do?”

The Team Builder As the head of Information Technology at Larsen & Toubro’s Hazira Works, the Deputy General Manager, Vinay Khargonkar is known for his excellence in balancing the trio of business, technology and his specialty — people. It’s an opinion reflected in L&T’s Head of Corporate IT, S. Anantha Sayana who also describes Khargonkar as an IT leader who strikes a correct balance between handling routine operations efficiently and

Photo by Sr ivatsa Sh an dilya

Having spent close to eleven years in Wipro, Narayan’s strong functional background — strategic selling, operations and distribution supply chain — has helped him hone a sound understanding of business challenges and strategies. Wividus, a shared services entity that offers common back-office services in HR, accounting and procurement to the IT and BPO divisions of Wipro, is a prominent example of him being a successful business strategist. Six years ago, when Narayan joined the IS group to handle special projects, he realized that the Wipro Infotech, Wipro Technologies and the acquired Wipro BPO (then Spectramind) had their own instances of ERP running their own separate back-office functions and catering to their users only. The inefficiencies that such a set-up introduced were imminently visible. Seeing a strong business case for

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Raghavendra Joshi,

workforce into a more productive and business-oriented team. Together they VP-IT Group, Yes Bank, came up with the High Availability Cluster has instilled a spirit Multiprocessing Hardware solution to of collaboration in the address the problem. Khargonkar received process of evolving overwhelming support from L&T’s IT strategies in the management, which allowed him to deploy organization. the most expensive clustering solution until then in Gujarat. It would give 100 percent uptime to L&T’s business applications. He rallied to get everyone onboard by conducting on-site training programs, with the vendor’s support, which would update employees’ knowledge to the new technology base. “We ensured a smooth transition and found that all the problems with the maintenance of hardware simply vanished. It gave the young staff ample time to take on new projects. When they realized that the systems were stable and they no longer needed to sweat over its maintenance, they started contributing in a much better way and explored technologies and got closer to business,” says Khargonkar. In order to build strong and effective teams, Khargonkar believes that communication is core. He fosters this by allowing his team members to make presentations to senior management. This increases the team’s recognition and visibility and draws them closer to the project. Khargonkar gives a free hand to his team members to achieve a task and ensures that he does not guide them on a day-to-day basis. “This fosters ownership,” he believes. He also encourages his team to take out time to attend conferences, carrying out exciting projects on cutting edge technologies to s t u dy m a r ke t s , understand technology keep his IT staff motivated and deliver value to the business. and listen to users before implementing IT solutions. “He has been succesful in creating an IT department that Invest time in learning new technologies, understand is very closely integrated with the business, is responsive business, deploy the right solutions and empower the to user needs and is also in sync with organizational goals. whole team is my mantra, maintains Khargonkar. His department helps young employees take ownership and “The four elements that help me build good teams accomplish tasks of high standard,” substantiates Sayana. are: empower, energize, communicate and support. I’ve Khargonkar’s history of being an efficient team builder always maintained that young people are smart. All they dates back a decade when he was transferred to the IT team at need is a support when things go wrong, and they can the then evolving Hazira plant in Surat, Gujarat. achieve anything,” he adds. “Eight years ago, eight out of every ten complaints we received were related to hardware and its performance at the Tip: Foster personal development with the goal of plant [in Hazira]. I saw our young engineers and programmers improving communication. Be prepared to dedicate spending a lot of energy in maintaining systems, rather than time and effort to a long-term program that uses onusing their skills to develop systems that would increase the-job situations to reinforce what has been learned productivity and enable the business to do better,” he recalls. at workshops and exercises. Khargonkar decided to set things right and build his IT

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change agent

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Cover Story | Leadership Lessons infrastructure — a fact borne out by the successful completion of Vulnerability Analysis and Penetration Test carried out by E&Y in April 2005,” explains Menon. Demonstrating Joshi’s key skills of being a change agent, Menon developed a collaborative environment for different divisions, and got them to share data and files while providing visibility to certain workflows across units. In the absence of a full-fledged infrastructure during the early days, Joshi and his team were able to support various operational, product and MIS units of the bank by deploying a tactical Intranet solution, while providing a greater degree of control to the end-users. “This not only cut down phone and mail traffic, but also helped in improving turnaround time,” says Menon. “The key to successful change management is collaboration. We were able to bring business heads and users along with the vendors while

The Change Agent

Change is difficult when you go it alone. The key to managing change is effective communication and a collaborative approach. It’s the reason why Raghavendra Joshi, VP-IT Group at Yes Bank, doesn’t focus on doing it all by himself. Instead, he often chooses to embark on building bridges with the business side, win their trust and strategize collaboratively. And it pays off. Says Aditya Menon, Yes Bank’s CIO, in his assessment of Joshi: “He has that balance required to acquit himself very well as a CIO — his thirst for knowledge, coupled with excellent management and delegation skills and leadership. An important CIO role is to communicate well specially amongst management, which Joshi does very well.” The scenario of change management in Yes Bank is unique because it started on a fresh page. Yes Bank doesn’t have legacy systems and pre-defined processes. “We had the advantage of starting from scratch. By default everyone was tuned to accepting things as they were coming along,” says Joshi. However, he is fully aware that owing to the breakneck pace at which the financial sector is growing in the country, the problems, hurdles and challenges that require change management will start to appear and soon snowball into challenging proportions. Joshi has, therefore, decided to tread o qualify for the 2007 Ones to Watch honor, candidates had to be nominated cautiously on the path of deploying new or sponsored by a CIO. Candidates could either be deputy CIOs or top IT technologies and engineering new processes. lieutenants but not yet full-fledged CIOs. The idea is to bring in a culture of ingrained Ones to Watch honorees had to demonstrate expertise in a wide variety of collaboration of IT strategies with business to areas, including expertise in a range of business and IT functions, experience effectively cut down the change management in leading a large project or conceiving a new business product, and the ability process required in the future. to turn around a troubled project or organization. They needed to have a list Joshi, who is responsible for handling the of on-the-job accomplishments in their backgrounds and had to be business bank’s retail and direct banking IT initiatives, strategists, project drivers, team builders, and change agents. instilled his approach of collaboration and After a due-diligence review by CIO’s editorial team, 25 honorees rose to the enterprise-wide communication, right from top — our Ones to Watch for 2007. the second day of his job in Yes Bank. This was in September 2004, when he joined the information security policy definition team. After completing the exercise of defining, drafting and approving the corporate Information Security strategizing roadmaps. This ensures confidence and trustpolicy with the help of external agencies such as PwC and building within IT and business, helps quicken decision Gartner and internal business divisions, Joshi initiated the making, and prevents teams from going back and forth for enterprisewide communication program to help users at clarifications. This kind of culture surely helps in cutting various business divisions to engrain the importance of infosec. down the change management process,” Joshi states. Joshi worked closely with various business divisions such as operations and products to educate users on the Do’s and Tip: Introducing change is risky. Support risk takers Don’ts, and to collaboratively enforce the defined information in your department by providing a safe harbor security and the Internet access policies. where taking risks is not discouraged and secondHis approach has yielded results with users being openly guessing minimized. CIO receptive to the security-related changes that did not exist in the organization earlier. “This project not only articulated Senior correspondent Gunjan Trivedi can be reached at the bank’s IS Security posture, but also secured the bank’s IT gunjan_t@cio.in

How We Chose the Winners T

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25 Leaders to Anish Kalucha, 38 Manager IT, BSES Power

“I generally hold group meetings to tackle stress. The most apt solutions can come from the most unexpected quarters.”

Bharat Sethi, 46 VP, Reliance Industries “I’ve learnt that IT isn’t only about technology and infrastructure. It has more to do with enabling processes and meeting the requirements of all stakeholders.”

Photos by Srivatsa Shandilya , shan kar an d al pesh

Bhupat Kapadia, 44 Manager(Systems), Gujarat State Fertilizers & Chemicals

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Girish Mehta, 51 Manager, Gujarat Narmada Valley Fertilisers “Work while you work, and play while you play. It’s a perfect way to deal with work-related stress.”

Jethin Chandran, 35 Head–IT, Infrastructure Planning and PMO, Wipro Technologies “I tell my team to learn to enjoy pressure, and build multiple skills. Importantly, know what you want to be.”

Jitendra Kine, 38 Head-IT, Ceat

“Getting involved in business strategies and the decisionmaking process brings an extra edge on the way to becoming a CIO.”

“Never limit your thinking or approach by existing capabilities or state of affairs. The acceleration of userdemands outpaces rate of technology advancement.”

Carasel D’Souza , 35 Asst Chief Manager-IT, Flat Products Equipments

Jitesh Sable, 32 Sr. Manager, Siemens Information Systems

“I consider myself to be more business focused than technology focused, though in a technical sense I understand the two fairly equally.”

“A piece of advice to my juniors: change need not always be large. A small change can bring great results.”

Emmanuel Soans, 45 GM-IT, Colgate Palmolive

M.R. Venkatesan, 44 Asst. VP, Polaris Software Lab

“My way of dealing with stress: be prepared to say no if unrealistic demands are made on your time. ”

“Develop the skill to distinguish between a jungle of technology and essential information, which aids the objectives of the company.”

1/15/2007 2:53:10 PM

o Watch Md. Jawed Ahmed, 30 Manager Systems, Adani Wilmarn

“You are never too prepared. Always have a backup to a backup. Murphy’s Law works in overdrive when it comes to IT.”

Mukesh Kumar Jain, 46 GM & Head-Retail Technology Group, ICICI Bank “Building new solutions and seeing them providing an edge to the organization is a stress buster all by itself.”

Narayan P.S., 41 GM, Wipro “The IS department’s value is as good as its most recent success. There’s no question of resting on your laurels. IT has to prove its worth every day, month and year.”

Pavan Gurtoo, 33 Assistant VP, UTI Bank “To be aggressive gogetters, companies need processes and delivery. Being technology-focused is a necessity. Avoid it and you could lose your edge.”

Prasenjit Mukherjee , 37 Manager IT, BSES Power “With my team, I harp on a few principles: accept change, plan ahead, keep updated and always look for an opportunity to prove your leadership skills.”

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Raghavendra Joshi, 37 VP-IT Group, Yes Bank “There’s no substitute for hard work; always be one step ahead of your peers through continuous education. Develop a ‘learnable’ character and enjoy life — you have only one.”

Ravikumar Muthuswamy, 39 VP–Facilities Management Group, i-flex Solutions

Our 25 Ones-to-Watch honorees bring business acumen, technical skills and passion to their drive for leadership. c o m p i l e d B Y t e a m CIO Satish P.V., 40 Sr. Manager, Hyundai Motor India “When you know your team and are able to set objectives for members and take responsibility for it, you can become a CIO.”

Sidharth Sharma, 27 Sr. Manager (Systems & Networking), LeasePlan India

“Deploying technology without an underlying understanding of business only results in solutions that benefit no one.”

“A key piece of learning is the importance of IT governance. Not implementing it properly can result in serious business issues.”

S. Chandrashekhar, 54 Deputy GM-Application Development & Maintenance, Ashok Leyland

Sundaresan Ramamoorthy, 47 GM-IT Services, HCL Technologies

“Always consult with the boss and your peers. In my experience, I’ve gotten a radically different views and solutions from them.”

“I stress on working as a highly motivated and energetic team, rather than building a few stray champions.”

S.M. Vashist, 46 Chief Manager–CS, National Fertiliser

Venkatesh Natarajan, 44 Dy. GM-IT, Ashok Leyland

“I advice my team to be innovative no matter what task they’ve been assigned to. Also, to assess their skills, and look for learning opportunities.”

“Priotization is important to beat stress. Focus only on things that require your attention and intervention.”

Sandeep Chadha, 28 Manager, Fortis Healthcare

Vinay Khargonkar, 42 Deputy GM & head-IT, Hazira Works, L&T

“Stress is a question of perspective. Work is a pressure only if you view it as such.”

“While it’s important to focus on business, CIOs must stay informed about current technologies and trends.”

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Bankable

Vision

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CIO: How does IT usage in India compare with the same in the UK and Australia, where you have had extensive experience?

How do you plan to improve ING Vysya’s retail banking operations in India? And what role does IT have in your plans?

Vaughn Richtor: You must remember that I worked in these countries some time ago. What I have seen is that the usage of IT has changed dramatically. But, one fundamental thing that hasn’t changed as much is people’s ability to adapt to technology. In fact, the technology uptake in India has been much faster than I have seen in other countries in earlier times. So, I feel that technology here is on par with the rest of the world — both in terms of systems and processes.

In the retail banking space, it is clear that without robust and solid technologies, it is going to be very difficult to deliver. This is because retail banking is about banking for a lot of people, and giving them quick and easy access. So, if you don’t have technology in place, you can’t do that. You need to interface with the customer, and the best example is in ATM and Internet banking. To ensure that low-cost, reliable and easy-to-use systems reach the people, technology is absolutely critical.

P hoto by KP N

While a section of CEOs in India might not always be comfortable with technology, Vaughn Richtor, managing director and CEO of ING Vysya Bank, feels relaxed while discussing IT. One reason for this could be that he spearheaded ING Direct, which relies heavily on the Internet, in Australia. He also believes that ‘IT strategy’ is a misnomer. Companies need to have an IT plan that is aligned with their business strategy, he asserts.

View from the top is a series of interviews with CEOs and other C-level executives about the role of IT in their companies and what they expect from their CIOs.

BY BALAJI NARASIMHAN

Imagin g by an il t

Vaughn Richtor, MD and CEO of ING Vysya Bank, says that IT is as important as people and processes for furthering the growth of an organization.

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VAUGHN RICHTOR wants I.T. to: Enhance customer satisfaction Provide efficient service Manage processes better

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Tell us about ING Vysya’s recent IT initiatives. Over the past two or three years, the biggest initiative we have had is to install a core banking system. Most of our branches were largely manual until a few years ago. In 2006, we completed the rollout of the core banking system — and that was a big step. Our last branch was computerized in July 2006. Over the same period of time, we have introduced Internet banking as a service to our customers. We are also enhancing the reach of our ATMs, and giving customers access to them across the country.

What is the role of the CIO in your organization? Does he also participate in formulating the strategy for the group? What is not quite clear to me is: why are people talking about IT strategy? I’m not sure what that means, but I do believe that the IT plan has got to be close to an organization’s business strategy. Therefore, when we look at the business plan we have developed, we also — as a subset of that — look at the capacity of our IT platform, so that we can determine if our IT can deliver the products, volumes and capacity at the right cost. IT, therefore, plays a key role in achieving our strategy in our organization. But at the end of the day, it is about a particular business strategy.

Does ING Vysya use business intelligence to find out what your customers want? There are two ways of using BI. To me, one is analytical capability, and I think that we still have some work to do to improve the analytical capability of our systems. But this is just half the issue. The other half of the issue is the understanding of our people in terms of what the customers want. And 46

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“IT must help by providing efficient and reliable service. If an IT product does the basic things well, that is the best value-add.” — Vaughn Richtor

that is why we look at our branches and our branch managers — because, today, servicing customers is largely branch-based. In that sense, the people in the branch are the best people to harness the analytical capability you have. In the future, as the market opens up and banking starts to depend less upon personal relationships, the ability of our company to understand our customers using technology and then deliver the same kind of personal service will be critical.

ING Vysya has tied up with Royal Sundaram to increase insurance penetration in the SME and rural segments. Does this also entail a change in IT usage? Yes, I think that it depends on the particular market segment. In some areas,

people are more ready to use customerfacing IT solutions, whereas they would still prefer face-to-face relationships in other areas. It is about understanding IT in relation to the product and the particular area. What is most important is making a decision on how to deliver what the customer wants. This is not to say that we can do all things in all places — what we do is make sure that we are delivering the right solution at the right place. The other point I want to make is that when you do introduce solutions, it is not just about deploying the technology. There is also an investment to be made in educating both the staff and the consumer on how to use that technology. So, the other part of using technology in the frontline is to make sure that you invest sufficient time in education, both for the customer and the employee.

In 2001, you remarked that with the onset of technology, it would be possible to play more golf, though the demands would remain the same. Has this happened in recent times? No, I play even less golf these days. You see, when I was in my 20s, the first PCs were coming out. The big fears at that time was that there would be a requirement for less people, and that the people who were working would be working less, and therefore have more spare time. Unfortunately, what has happened is that technology has enabled things to happen much faster. Today, the demand on my time has actually increased. I think that we should, as a society, look at the impact of technology. Organizations talk about a work-life balance, but technology has made it harder to achieve.

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For a large group like ING, is it better to have a unified IT strategy or allowing each country to define its own strategy? There are benefits to be derived from group synergies. If there is a tried-andtested technology that is applicable to local scenarios, then that makes sense. Why go through the pain of reinventing the wheel when you have something readymade? For specific software solutions, we have to take two things into account. First, the requirements of the local market and the products may be different, and the cost of adapting the solution may be too high. Second, different markets have to work on different cost paradigms. You can’t simply take something because it may not be appropriate to local transactions. We have to take local characteristics into account.

How much of ING Vysya’s growth would you attribute to technology? I cannot pinpoint IT’s exact contribution. But I will say this: what IT should be doing is allowing us to deliver quicker, faster and cheaper service. To that extent, I think, what IT has done is allow us to get a much better understanding of our processes and customers. Because of this, we can provide better services. We still have a long way to go, and I’ll probably be able to answer the question better next year.

Is there a great difference in how IT is used across ING Vysya’s divisions? Technology is equally important in all divisions. It’s just that the way in which it is used that differs. So, for example, if you look at our treasury business, Internet banking is really not that important, but having the technology to manage our market transactions in investments and derivatives is critical.

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On the other hand, customer loans and customer deposits are important in retail banking, and customerfacing systems like ATMs become vital. The ability of technology to support each of our businesses is equally important — only the way in which it is done is different.

SNAPSHOT

ING Vysya Bank NET WORTH

Rs 102 crore DEPOSITS

Rs 13,335 crore OUTLETS

575

I.T. budget:

So, we shouldn’t just put IT in because everybody thinks we need IT. The best way in which IT can help is by providing efficient and reliable service to the customer. If an IT product does the basic things well, to me, that is the best value-add that you can get.

Rs 70 crore-90 crore

You are credited In view of IT Staff: 250 (including staff with the Internetregulatory to whom work is outsourced.) reliant ING Direct compliance, do you CIO: Prasad C.V.G becoming the sixth see any change in biggest retail bank. the role of a CIO? Do you have such No, I don’t think so. I think that the role of the CIO has a vision to push changed over the years. From initially having Internet banking in India? I don’t take full credit for ING Direct because I was only responsible for Australia, which is one of eight countries that was part of ING Direct. But I certainly think that in Australia, we had a good degree of success. In terms of vision, I think that it was not about the size or new products. The biggest success was customer satisfaction and the ability to attract new customers. We also engaged and motivated our employees while achieving this. I would be happy if we could achieve the number-1 ranking in customer satisfaction and customer growth, and the number-1 ranking in employee engagement because if you do that, then growth will automatically follow.

just technical knowledge, the modern CIO has learnt how to make technology deliver business value. But this change happened a long time ago. Over a period of time, the cost of hardware diminished, and the cost of business solutions started to rise. CIOs have had to adapt to that. They have also had to understand business much more. Rather than giving somebody a computer to work on, the CIO has to ensure that he is providing a solution that delivers business benefits. Understanding the core business has become more important for the CIO, and I think that this will continue. CIO

What about your investment strategies in relation to IT? I would expect that every IT investment pays. But it is not just about spending money on IT and getting people computerized. There may be cases where technology is not the right answer, and here it may be better to have people doing it.

Special Correspondent Balaji Narasimhan can be reached at balaji_n@cio.in

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BY THOMAS WAILGUM

As the demand for real-time data increases, as more and more information flows into the enterprise, the challenge of understanding and managing it grows proportionately. And sometimes, more is just too much. When you first meet CIO Ron Rose, heâ&#x20AC;&#x2122;s more than happy to tell you about the 70,000 or so things that can go horribly wrong at Priceline.com, the consumer travel company built solely on a website that gets 10 million page views a day and books nearly Rs 13,500 crore worth of travel transactions annually. Generally speaking, those 70,000 data points are monitored on a real-time IT system dashboard. The company has been testing new dashboards that offer up-to-the-second information and correlation analysis on numerous systems, including the state of the plumbing and network operations; CPU utilization; various application metrics (how much time is needed to transfer data within the system); Oracle database Reader ROI: performance; BMC How to calibrate the monitored performance of assimilation rate of things like I/O utilization; real-time data operating system paging How to judge the value (how much data is of immediacy moving to and from the Ways to calm a nervous systems disks; and if the real-time system

Data Management business intelligence software and supply chain management operating system is running out of RAM to work with) and tools have propagated as companies struggle to keep up a whole lot more. All those metrics (and more) are crucial with the demands of 24/7 global operations. According to a to Priceline’s business as illustrated by a recent Harris September 2006 Teradata survey, 85 percent of responding Interactive consumer study that found that 40 percent of executives say that decision-makers need more up-to-date online consumers will abandon their transaction (or turn information than in the past. to a competitor) if their initial attempt to interact with a But as many companies have long known, more site is foiled. information, delivered more frequently, hasn’t always led So Rose and his IT staff collect and analyze a torrent of to faster or better decision making. real-time data to identify, prevent and fix problems before The real-time boom has introduced some unintended that happens. And he says being able to do so has saved the busts: overwhelmed business users and IT managers company millions in downtime and repair costs over the drowning in too much information, with floods of years. “Winning by not losing,” he calls it. irrelevant business activity alerts and system performance Rose’s IT group isn’t the only beneficiary of data leading them to make rash decisions or turn off realPriceline’s real-time capabilities. Priceline’s business time applications altogether. “If you’re not giving real-time analysts tap into a business activity monitoring (BAM) data to the right people at the right time, you’re opening up system, which can slice and dice up-to-the-minute yourself to a lot of risk,” says David Williams, research VP information detailing the types of airline tickets, hotel of IT operations management at Gartner. rooms or car rentals that are selling, the completion Of course, by itself, providing data in real-time isn’t percentage of different types of orders and (much) more. dangerous. “Real-time information is always useful if you All those data points (and more) give business users know how to make sense of it,” says Hau Lee, the Thoma the ability to see trending demand for specific airline Professor of Operations, Information and Technology at or hotel offerings, or whether visitors are completing Stanford University’s Graduate School of Business. “That ‘if’ transactions or bailing out at the last minute on certain is the problem.” products. The business users can then adjust that data Indeed, there are a steep learning curve and to generate more sales. “[The business group’s] hourly cultural change in a real-time environment that many reports, which summarize the financial data as it moves through the company, is the MTV of the technology department,” Rose says. “They love to keep their fingers on the pulse.” But with that dependence on such fastmoving and variable data, Rose acknowledges that users also have to be aware of any noise RFID promises a gold mine of data. Now, what are you going to lurking in the system. For example, when do when 90 percent of it proves to be pyrite? there might not be a statistically valid amount of data (say, too small a sample size for one of Priceline’s sales categories, such as As companies collect more data, and as the business demand for real-time data bookings at one of its smaller hotels), which increases, so too will the demand for access to it. Right now, less than 15 percent of a business user may think is a trend when, employees at an average organization have access to real-time information, according in fact, it’s not. “It takes more than just a few to Joe Thomas, global head of new business development for Capgemini. However, the minutes to make a trend,” he cautions. emerging intelligence economy will demand that organizations empower at least 70 percent Rose is confident, however, that Priceline of their employees with real-time information and equip them with ways to use it. is using all that near-real-time data to make Nowhere is that challenge more of a concern than with RFID technologies. “RFID better business decisions and provide a holds great promise, but also great danger,” says Kevin Poole, consulting services leader highly available website with fewer instances at Capgemini. “Done right, it gets you [data] at a level of detail and specificity — and in a in which any of those 70,000 things that can timely manner — better than before. If it’s done wrong, there’s going to be between 10 go wrong do. times to 100 times more data available, and you run the risk of information overload.” Poole says CIos need to architect their systems to manage this flood of real-time data as well as apply business rules to help control and make sense of it all. Hau lee, the Thoma professor of operations, Information and Technology at Stanford University’s Graduate School of Business, compares the RFID movement to a gold rush. Moving to a real-time information-delivery “All of a sudden, there’s this wealth of data,” he says. “And as we all know, when you go to environment like Priceline’s has long been the gold rush, you need tools and techniques to filter and get the gold nuggets, because an ambition for many companies. Real90 percent of it is dirt.” time capabilities in business performance dashboards, systems monitoring applications, — T.W.

More Data on the Way!

Everybody Loves Data

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Data Management organizations underestimate. “Everybody is crying for this data, but when you give it to them, they find fault with it,” says Heineken USA Director of IT Carol Schillat. “And the fault is that they don’t know how to use it.” Ill-planned real-time data implementations can be disastrous, negatively affecting customers, profits and productivity, according to Teradata’s survey. To avoid the heartbreak of a failed real-time romance, CIOs need to understand which information their company really needs, how that information matches up with the way the business users do their jobs, and how and when it’s most beneficial to deliver that information. Once that analysis is complete, CIOs can install a process and IT system that delivers more actionable and correctly timed data flows. “If the business folks haven’t provided that level of detail, and IT didn’t ask for it, the system can provide not enough or too much information,” says Kevin Poole, consulting services leader at Capgemini. And in either case, “[business users] will start to ignore it.”

Real-Time Relativity Like most terminology in the high-tech world, realtime means different things to different people in different industries. But what’s common to most people’s definition, says Royce Bell, CEO of Accenture’s Information Management Services, is that the data is delivered “within an actionable time frame,” whether that means within seconds or hours.

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In the financial world, real-time data is, by necessity, defined as instantaneous. Traders, brokers and fund managers have to have information on global stock, equity and commodity markets delivered by the second. One can easily see why. In the financial services industry, downtime costs anywhere from Rs 6.3 crore to Rs 29.25 crore in lost revenue per hour, according to industry sources. A similar case can be made for systems in e-commerce companies such as priceline.com, or in the airline industry (air-traffic controllers), utility industry (controllers monitoring electricity grids) and healthcare personnel (nurses monitoring patients), where even the smallest fluctuation in data is significant. Step away from those segments, however, and the notion of what’s instantaneous begins to slow down by minutes, hours or days, and the question of just how much, and just how often, becomes more uncertain. “Most organizations believe they need live data, but [in reality] they tend to consume things in a daily cycle,” says John Hagerty, vice president and research fellow at AMR Research. “Daily is about as fast as they can do it.” Consequently, other terms closely related to real-time have appeared, including near-real-time data (anything updated more frequently than daily) and right-time data (updated any time of day or week that the company has determined to be most beneficial). At Delta Apparel, a Rs 1,215-crore manufacturer and distributor of branded and private-label activewear, CIO Keith Smith describes his “two worlds.” In one, subsecond real-time data informs decision making in Delta Apparel’s manufacturing operations — from tracking when an order of polo shirts will be Priceline.com CIO completed to figuring out Ron Rose: “The which distribution center business group’s in the United States is hourly report is the MTV of the technology best-suited to distribute department. They love those shirts in the to keep their fingers shortest amount of time. on the pulse.” “This is where real-time data is critical,” he says. But in the other world— for sales information and budgeting — “real-time data totally falls apart,” Smith says. It’s just not practical or necessary. Though Delta Apparel and Priceline were able to distinguish between the two worlds and adjust their data collection and delivery systems

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Data Management accordingly, many companies haven’t been able to. And that’s where real-time can get real dangerous.

Blinking at Real-Time

Cutting Through the Fog Tools that can help rationalize real-time management.

For the majority of 21st-century businesses, the possibilities of real-time data streams are endless and endlessly According to David Williams, research VP of IT operations management at seductive: business activity dashboards Gartner, there is a new class of IT management applications (Williams calls them on the PC, network monitoring alerts “learning technologies”) that can gather and synthesize real-time data, correlate it with via e-mail, just-in-time manufacturing historical data and allow companies to anticipate potential problems — say, a critical systems. The idea is to help people make networking issue for a retail website. “It’s a technology that learns what’s important better decisions. to your company,” says Williams. According to him, three vendors have noteworthy But do they? “Too much information products in this space: freezes the human mind,” says Integrien The company says its Alive product, using what it calls “integrity management,” Accenture’s Bell. “When there are too identifies, predicts and prevents IT-based business problems via holistic views and realmany choices, a normal human being time analysis of IT infrastructure. won’t be able to make a choice.” Netuitive According to Netuitive, its product eliminates the need for labor-intensive and errorIs business reaching the tipping point of prone manual setting of performance baselines and thresholds by self-learning a company’s information overload? Malcolm Gladwell, normal operating characteristics. Then it continuously correlates, analyzes and adapts itself in his best-selling 2005 book Blink, which to data inputs from all of the systems, servers and processes—in real-time. looked at how we process information to ProactiveNet The company claims its Business Services Management solutions improve make decisions, described doctors misunderstanding of the performance and availability of IT services and how infrastructure diagnosing heart attacks in the emergency affects the applications and processes that power the business. With this greater room because they were attempting understanding, companies are better able to prioritize IT systems around processes that to gather too much information, in too carry the highest business values rather than around the latest problem at hand. many cases sending home patients who —T.W. were actually having heart attacks and admitting patients who were not. According to Gladwell, the But it’s not just e-mail alerts. Typically, decision-makers doctors were gathering and considering far more information in manufacturing companies think that they want daily than they really needed “because it makes them feel more updates for their material requirements planning (MRP) confident.... The irony, though, is that that very desire for system so they can make changes to plans and update confidence is precisely what ends up undermining the forecasts and inventories on a daily basis. And vendors accuracy of their decision. They feed the extra information selling MRP systems (surprise!) usually agree with them. into the already overcrowded equation they are building in But, “Guess what: Reality says I can’t deal,” Smith says. He their heads, and they get even more muddled.” says that companies simply cannot make those decisions An analogous situation is happening in IT departments. on a daily basis because there’s too much information and A recent survey by Netuitive, a real-time analysis software too much flux. “It’s one of those concepts that’s candy in vendor, found that 41 percent of respondents in larger the sky,” he says. organizations receive 100 or more alerts per day, of which Put another way, business managers and other decisionat least half (more in most cases) are false positives. Of the makers are sometimes surprised and overwhelmed by the 195 IT organizations surveyed, 39 percent said that they velocity and volume of data when a real-time system fires either intentionally set thresholds above optimum levels up. “You get what you ask for, not what you expected,” says to avoid excessive alerting or turned off their alerting AMR’s Hagerty. functionality completely in response. In both cases, the system has been rendered pretty much useless. Delta Apparel’s Smith has seen how too many alerts can create a choke point. For example, when a Delta staffer creates In 2005, two researchers, one from Georgia Tech and the an order, an e-mail goes out to a set of other employees who other from the University of North Carolina, set out to need to know. “In theory, that’s a good practice,” Smith says. examine whether increasing the frequency of real-time “But if we’re entering a thousand orders a day, and I’m a data updates 'enhanced performance'. Would they be able recipient, there’s no way I could ever manage that information. to more quickly respond to changes in the environment No one can respond to a thousand e-mails a day.” and see the consequences of their actions? wondered

How to Calibrate Real-Time

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Data Management Nicholas Lurie and Jayashankar Swaminathan. What they discovered was that managers who received more frequent data points were making more poor decisions. “The danger of real-time data is that it may come to you at a frequent rate, maybe every hour, and if you respond to that data, if there’s some random event and you treat the random event as systematic, it could really throw you off,” Lurie says. Yossi Sheffi, director of MIT’s Center for Transportation and Logistics and author of The Resilient Enterprise, finds no fault with real-time data, only in the way people use it. “The question is not, 'Is real-time information bad or good?' There’s only good in it,” Sheffi says. “The danger [of real-time data] is if you would react too fast and not wait for the trend to reveal itself.” As an example, Sheffi suggests that Procter & Gamble should not start making inventory or planning decisions on Tide sales at Wal-Mart based on data they receive every five minutes. “You don’t want to react to someone who came in and bought five boxes,” he says. What you should do is look for trends in product sales combined with historical data — for example, during the last few days or weeks — and correlate that with other event-type data, such as in-store promotions or weather information that may affect sales. “You have to use it smartly,” Sheffi says, noting that some companies right now are better at this than others. At Priceline.com, Rose seems to have found that sweet spot for delivering real-time data to both IT and business users. The company was founded in 1998, and since then

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Rose says a culture of real-time data has flourished. “From day one we’ve always been about collecting business metrics on the fly,” he says. When asked why the business prefers hourly reports, he answers that while he could offer them minute-by-minute data (the BAM system has that capability), they’ve discovered that anything under 15 minutes most likely wouldn’t be sufficiently significant to constitute a trend or something that demands their attention. “Hourly data is good enough,” Rose says.

The Sock Market International Legwear Group makes a lot of socks. As the third-largest sock-maker in the United States, ILG runs on a weekly cycle for processing orders from its customers, which range from Wal-Mart on down to Mom-and-Pop stores. And for the most part, ILG’s planners and forecasters are able to satisfy their retailers’ demands for socks and sync up those demands with ILG’s global suppliers. But if you know anything about the sock market, you know how difficult ILG’s planners’ jobs can be. “Sock sales are very dependent on the weather,” says Alex Moore, ILG’s CIO. “If it stays hot into the fall, our sales do not start climbing.” Or, if a cold snap hits the South, sock sales will jump for as long as it lasts. “I don’t care how good your software forecasting system is, you can’t predict when it’s going to get cold,” Moore says. The unpredictability and randomness that can throw off a company’s supply chain system is called noise — whether it’s an ice storm, earthquake, e.coli outbreak or terrorist attack. And what noise does is make computer systems, especially real-time sys t e m s , nervous. That, in turn, amplifies the perils of demand and inventory planning. “A nervous system is one in which you try to react to every Heinekin USA director little thing,” says Moore. of IT, Carol Schillat: “If you change your plan “Everybody is crying with every thing little for this data, but when thing that happens, that’s you give it to them, a bad thing.” they find fault with it. It therefore becomes And the fault is that they don’t know how critical that companies to use it.” develop some type of strategy that can filter

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Data Management out noise and nervousness. (For a list of tools that can help you do that, see “Cutting Through the Fog.”) Overreacting to sudden and random upticks in sales can produce a deadly chain reaction in the supply chain, with each supplier downstream from the first increasing its orders and supply requirements because it wants to have enough inventory to comply with the illusory rising demand. This is called the bullwhip effect. In 1997, Stanford’s Lee cowrote the seminal article on it — “Information Distortion in a Supply Chain: The Bullwhip Effect”—and the now-famous example of the variability (and challenges) in demand planning for P&G’s Pampers product remains the best-known example. “You have to be able to distinguish between noise versus a real systematic shift,” cautions Lee.

The Beer Facts The fifth business day of every month used to be a significant day for Heineken USA. On that day, employees got their first glimpse of the previous month’s sales data, which provided a snapshot of how well the U.S. arm of the Dutch brewer was doing. “This company lived and died by monthly data,” says Director of IT Schillat. That the business users had to wait a full month to view Heineken’s key performance indicators didn’t bother the staff. It’s just the way the beer industry operated, they thought. But by 2000, Schillat knew differently. Industry heavyweights Budweiser and Miller had begun investing millions in building real-time connections to their distributors. Schillat turned to Vermont Information Processing, which had already made inroads in the marketspace with its supply chain products. In less than a year, Schillat could stream distributors’ daily sales (prices, quantities and which retail stores the beer had been shipped to) to the business. “This was huge for us,” she recalls. “All of the sudden, we had daily sales.” Though this wasn’t what one could call true realtime data, it was as close to real-time as Heineken had ever seen. But not everyone liked what they saw. “People didn’t have a lot of faith in it,” Schillat recalls, because they were still receiving their good old monthly feeds, and the two sets of numbers didn’t always jibe with each other. Since then, Schillat and the business users have been working to design new processes to accommodate faster data streams. But there’s much more work to be done to deal with the users’ training and development, and with figuring out just what data is most appropriate and actionable and how business users should respond.

“It takes more than just a few minutes to make a — Priceline CIo Ron Rose

Game-Planning for Real-Time That, of course, is a key part of the CIO’s job, no matter the system or project: facilitating a conversation about what the business truly needs, and where and when real-time, near-real-time or right-time data feeds are appropriate. “This is not something the business can have a couple of meetings about, define and outsource to the IT department,” says Accenture’s Bell. “It’s a conversation about the source of data and how you use it, and what may be absolutely ideal will be completely different in 12 to 18 months’ time. It’s a continuous conversation.” AMR’s Hagerty advises CIOs to ask these questions: How do people manage information flow in their part of the business? Do people really need real-time everything or just frequent refreshes? How should the IT organization respond to support the data needs of business? “You need to rationalize this up front,” Hagerty says. “When someone says, ‘I need real-time data’, IT should ask: ‘What are you going to do with it?’ Sometimes business users don’t like that, but IT needs to know.” In the end, real-time data is only as good as the uses it’s put to and the processes that support its use. “I don’t think there’s danger in trying to achieve [a realtime environment],” says Delta Apparel’s Smith. “But you could easily spend a lot of money trying to get to that candy in the sky, and then realize that the information overload is too great. “Not all people understand the impact of real-time information.” CIO

SeniorWriterThomasWailgum can be reached at twailgum@cio.com.

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G.I.S.

The Tamil Nadu Forest Department is finding new and more sustainable solutions toward afforestation — on the back of more accurate data and the ability to monitor and evaluate progress.

Zero-in

On the Problem By Sunil Shah

Reader ROI:

Benefits of GIS beyond monitoring change A sustainable IT program for multiple stakeholders The promise of in-house e-governance solutions

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Still, the gray footwear accessory in a corner of the Tamil Nadu (TN) Forest Department’s lab is symbolic, given the ease it can add to a process — and the task of fitting something to size. The shoehorn is one symbol. From a macro and technology perspective, the Rs 300-crore Geographic Information System (GIS) project to help increase forest cover in the state is another. The TN forest department does have an eye for detail, and appreciates a tool that can streamline work. And its thoroughness has served the seven-man GIS team well over the past three years, as they’ve pored over thousands of maps and a jungle of information to create the first multi-layered, visual map of forests in Tamil Nadu. Putting it together was painstaking. The GIS team began by working with data on forest cover from the Forest Survey of India, hard copies of road and topographical maps, field observations from rangers, and hard-to-date, hand-drawn forest reserve maps — most of all this in wieldy, inaccurate hard copies. As a final layer, the staff topped the multidimensional map with satellite images. As it relies on a visual approach, GIS is renowned for its ability to monitor change in easy before-and-after pictures. It is especially popular among decision makers who

Illustration by unnikrishnan av

A shoehorn would be conspicuous in the 21st century shoe-rack.

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G.I.S. love the quick, transparent and easilydigestible information that GIS offers. The love isn’t misplaced, particularly because GIS works efficiently over large areas. “The proliferation of GIS is explained by its unique ability to assimilate data from widely divergent sources, to analyze trends over time, and to spatially evaluate impact caused by development. For an experienced analyst, GIS is an extension of one’s own analytical thinking,” says C.K. Sreedharan, principal chief conservator of forests, and the person who has spearheaded the forest department’s GIS project. But GIS is more than a show-and-tell tool to track change. The TN forest department has used it to identify and prioritize problems quickly, and help find appropriate solutions. Andhra Pradesh, Karnataka and Kerala have attempted GIS implementations to support their afforestation programs, but are yet to produce the sort of results shown in Tamil Nadu.

not only shows up degradation in stark relief, but, with innovation, it can also be used to improve the department’s chances of targeting locations where afforestation has higher chance of success more quickly. In the turf war with the villages, the department knows from experience that its best chances lies in the adage, ‘If you can’t fight them, join them’. So, the department started a program in 1997 called Tamil Nadu Afforestation Project (TAP) that has consistently aimed at sustainability, by embracing and including village folk. “TAP was conceptualized as a joint forest management-based afforestation project where the focus was more on people’s participation and improving the livelihood of inhabitants in the project villages,” says Sreedhran. This is tough to put into practice, given that the wants of both parties are tugging in diametrically opposite directions: villages want to cut firewood and sell, the department wants to consolidate and grow.

The department has made a number of attempts in the past, such as paying villagers not to cut firewood. More recently, it has begun trying more sustainable approaches, using GIS, which they hope will imbibe a sense of ownership towards the forest among villagers. One of the initiatives is to allow villagers to ‘adopt’ areas in the forest. At last count, 1,500 villages had been given 250-350 hectares of forest land. In return for fencing and guarding these areas and improving their ecological balance, villagers can sell the produce from the forest. The most significant aspect of this arrangement is that the villagers re-forest degraded patches of land. In 2002-03, the villagers had notched up 83 lakh man-days of work, according to the department. Some villages have made a few lakhs a year from this initiative. In the context of such initiatives, the GIS project has contributed immensely towards making informed choices

P hoto by Sr ivatsa Shandilya

Under the GIS Microscope The TN Forest Department is responsible for 22,865 sq. km. of forest land. Its primary functions include preservation of forested areas, improvement of degraded patches, and growing the forest acreage. It’s been a longstanding battle with commercial bodies and village settlements, which rely on the forest for resources and food. Further, the National Forest Policy of 1988 states that 33 percent of any state must constitute forest cover. In Tamil Nadu, the figure stands at only 17.58 percent — just above half of the target. Of the existing forest cover, only 2,440 sq. km. (1.8 percent) is heavily forested. Pushed by the union planning commission, the forest department here has been making efforts to increase forest and tree cover in the state to 25 percent by 2007 and 33 percent by 2012, mainly by encouraging tree cultivation in and outside reserved forest areas. However, there are more than 3,000 villages that border on reserved forest areas. The GIS system accurately pinpoints encroachments and the extent of damage that villages inflict. It also delineates areas where degradation is taking place. The GIS 5 6 J A N U A R Y 1 5 , 2 0 0 7 | REAL CIO WORLD

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“The time saved on a simple survey using GIS is 90 percent, and I now need half the manpower.” — C.K. Sreedharan Principal chief conservator of forests Tamil Nadu Forest Department

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G.I.S. quickly. For instance, it has facilitated the choosing of villages for the initiative and the quantum of land to be allotted to them. This also entails surveying to determine the most appropriate piece of forest, in terms of distance from a village and forest cover. A few years ago, there was no telling how long a survey could take. Villagers, accompanied by rangers using a chain-andcompass method to gauge distance, took time to organize and supply the results. “The time saved on a simple survey is as much as 90 percent. Also, I need 40 to 50 percent less manpower (with the use of GIS),” says Sreedharan. Part of the TAP mission is also to create harmony between the needs of villagers and that of the forest, including water. Using GIS, forest department officials can, for example, slash the time taken to find a location for a bund, a small dam to create a pool. S.A Raju, assistant conservator of forests, says that with GIS, the forest ranger can, for instance, locate a 30-degree slope, one kilometer from a village, in an area where you don’t need to cut trees to build a bund. If such a choice doesn’t exist, GIS can provide the next best option. The long-term benefits of GIS-enabled watersheds cannot be ignored, says Sreedharan. Although they seem like soft benefits for the public, the water projects can potentially better the living standards in villages by pushing up the water table. The link between higher water tables, better harvests, and more readily-available grazing land are direct. And these financially benefit the village folk. “Once these assets are created, their benefits last a long time,” says Sreedharan. For the ROI-mongers, the Forest Survey of India has found an increase of 1,161 sq. km. of forest cover in Tamil Nadu between the 2001 and 2003. However, this increase, cautions the department, can be a mix of both real changes and interpretational changes. “With remote sensing technology, interpretational corrections are part of the methodology. These corrections keep reducing in subsequent assessments with increasing ‘ground-truthing’, and real changes are depicted only after some years,” says Sreedharan.

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Keeping it In-house

the collaboration helped both organizations,” says Sreedharan. The department Putting the GIS system collaborated with the NRSA together was painful. Officials to build skills, and created recall how it took three years SNAPSHOT a separate department to of tedious work to create the Tamil Nadu Forest ensure that training was 1:50,000 scale map, accurate Department: GIS a constant, self-sufficient down to the beat, the smallest Project cost Rs 300 crore process. “Training is a unit in the forest department’s continuous process. We have administration. The GIS Targeted area of afforestation 12 circles. The bottom three system needed at least six 32,514 sq. km. by rungs of each circle (rangers, layers of maps to be useful, 2007 foresters, forest guards) says S.A Raju. Project Staff are trained (at the Chennai To put the layers together, 6-7 headquarters) over four days, the outline of each physical Department staff every 12 weeks. We’ve already feature, such as roads and 9,000 trained between 800 and administrative boundaries, Villages in the 900 field officers,” says Raju. on each map for each of the project Their work with the six layers had to be made into 1,500 NRSA has also introduced vectors to ensure that they Project enabler computerization at the were no longer images but C.K. Sreedharan lowest administrative level, coordinates. The maps then Source: Department the establishment of radio needed to be placed accurately frequency links, and the use on top of each other. Whenever of GPS. A large chunk of the a map’s inaccuracy required project cost has gone into buying satellite cross-checking with forest rangers on the images, say Sreedharan. Depending on ground, the process would hold up a layer, what the department is studying, new creating a Domino’s Effect of delay on an satellite images are bought. Satellite entire section of the map. data used to monitor fire, for instance, is Yet, none of the work was outsourced. bought annually although data to analysis The forest department’s GIS project is changes in vegetation is bought every 5-10 among the few successful e-governance years, he says. projects that haven’t been outsourced. Moving forward, the GIS team is Within e-governance, it’s hard to looking at how the system can be used resist the temptation to outsource. With for administrative purposes. By linking high failure rates — up to 85 percent of information to each section, the department e-governance projects fail — most heads might be able to mark the progress of forest of departments with scant IT background officers and, more importantly, projects. feel more comfortable among experts. But, “It is true that GIS can definitely help and outsourcing costs. Worse, with the check facilitate the development if monitoring to the outsourcers, many government protocols. Non-spatial attributes can agencies fork over the hands-on experience be linked to geographic features where and in-depth knowledge needed to run project work is undertaken. We are trying large, complex projects. The TN Forest to develop monitoring protocols through Department teamed up with the National Web-based GIS,” says Sreedharan. Remote Sensing Agency (NRSA) in Much like the grey shoehorn in the Hyderabad to set up its Geomatics Centre department lab, then, the GIS is there to in Chennai. However, the department’s be used. It’s only a question of how it can decision not to outsource meant that it had be applied for an array of purposes. Who to train its own staff — all 9,000 of them says perfectionism doesn’t pay off? CIO — spread over 12 circles and 26 divisions. “The question of outsourcing arises only when you do not have the desired skills Copy editor Sunil Shah can be reached at available in the organization. In our case, sunil_shah@cio.in REAL CIO WORLD | J A N U A R Y 1 5 , 2 0 0 7 5 7

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Essential

technology Voice-over-IP projects often stall during or after pilot testing. Here’s hands-on advice from CIOs who kept their projects running.

From Inception to Implementation — I.T. That Matters

Don’t Let VoIP Throw You BY MICHAEL FITZGERALD VoIP| Long before the Vonage IPO turned into the year’s worst use of investor money, CIOs

had started feeling chilly about voice over IP. In fact, after 2005 studies showed that 32 percent of American firms were piloting VoIP, a Forrester Research survey in August 2006 showed that adoption rates were flat from the same period a year earlier. Forrester Research analyst Lisa Pierce declares that enterprise VoIP deployments in the United States “have stalled.” The reasons why will sound familiar to most CIOs: organizational deadweight, technology fear, uncertainty and doubt, and competing demands on network upgrading funds. But you can get through a VoIP pilot without stalling. We talked to CIOs who’ve done it, to look at some common and unexpected trouble spots, plus get advice on how to avoid or conquer them.

UnexpectedTechTroubles The problem: Can you manage a VoIP network with your existing staff once it’s in place? The answer: Be prepared for a few glitches, and get hands-on wisdom during install. 58

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essential technology

VoIP is supposed to make the phone system better, not make it stop ringing. But one early side effect of the way a new VoIP system had been implemented at Serta Mattress was causing phones to stop ringing for as long as 20 minutes at some of its factories. For the not-so-sleepy mattress maker, VoIP emerged as a potential answer to the problem of rapid growth during the 1990s. Ambitious and judicious management took a mattress factory with a Serta license and built it up to the point where it acquired Serta itself: By 2003, the company had gone from three facilities to 23. Each of them had a telephone system (a PBX, in phone parlance), and each a maintenance contract, eating up between Rs 22,500 and Rs 45,000 per month.

That install experience proved vital after Serta had moved past the pilot stage and implemented VoIP in several of its locations. Zett had opted to use the wide area network to do routine Sphere software upgrades. But after a few of the sites had moved to VoIP, it turned out that slow server response time could temporarily suspend phone service. “We could lose phone operations for 15 or 20 minutes,” she says. “And that’s way too long.” Because they’d installed the system, Zett and her staff knew they had several ways to fix this problem, the easiest of which was to schedule the updates at night. So they decided to install local upgrade servers (ordinary PC blade servers) that download updates only at prearranged times, usually at night, which allows for a much quicker

Beat theVendor Blues

What’s most likely to slow down your VoIP project, or even leave it in pilot testing nevernever land? Forrester Research’s Lisa Pierce cites three big culprits: 1. Organizational Mess VoIP works across wide area and local area networks, which many companies handle through different budgets and departments, when IT and telecom groups are separate. TIP: Companies may have to reorganize internally before developing a companywide VoIP strategy. 2. Network Traffic Trouble It’s not unusual for performance problems to creep in as you add VoIP users or sites. “The most important decision anyone who is considering implementing VoIP can make is how they will ‘live’ with it after the installation is completed,” Pierce says. TIP: Make sure you have comprehensive VoIP monitoring and management tools, and staff expertise before rollout. If you can’t afford these, consider managed or hosted services, she advises. 3. Tough Business Case Moving to VoIP typically means network upgrades. But VoIP may not be top on the list of networking upgrades, especially with telecom budgets growing more slowly than IT budgets. Meanwhile, conventional longdistance rates are plummeting, undercutting what has been VoIP’s biggest advantage. TIP: Piggybacking on a network redesign may help. Keep a close eye on the VoIP dollars and sense as phone rates change. — M.F.

The problem: What do you do when your vendor can’t deliver as promised? The answer: Know when to pull the plug on one vendor, and know what questions to ask the replacement. Saving mad money on telephone costs is what makes most CIOs check out VoIP. That’s what got the interest of Marty Resnick, director of technology operations at Norman’s Nursery, a Rs 292.5-crore

nursery wholesaler in San Gabriel, Calif. The cost savings are what kept him going through a “Nightmare on IT Street” technology pilot, which he hopes has no sequel. Norman’s Nursery has three facilities, none closer to each other than about 100 miles. Its phone bills in 2004 were running

Norman’s Nursery was still paying SBC money for features that it had been promised, but still hadn’t received. So CIO Marty Resnick went looking for a different VoIP system. Donna Zett, CIO at Serta, thought VoIP would give her a way to run a single PBX system, based at company headquarters in Hoffman Estates, Illinois. That would save the company a bundle on maintenance, for starters (its VoIP system now costs it about Rs 90,000 a month in maintenance). And since an internal study showed that 60 percent of its long-distance calls were between facilities, VoIP promised Serta savings on phone bills too. Still, Zett trod carefully. She put three vendors — Cisco, Avaya and Sphere Communications — through their paces. That included access to reference customers with network and corporate structures similar to those of Serta. She even went to visit six of those reference customers. Serta chose Sphere, and spent about Rs 67.5 lakh and four months rolling out the VoIP system. Zett had her own staff work on the installation project, to make sure it could handle the new technology.

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Top 3 VoIP Troublemakers

update to the hub in the local facility. Serta’s IT team also created the option of having local operators at each plant, instead of routing all calls through headquarters. Zett’s been happy with VoIP, and especially happy that she had her staff do the rollout. “Doing our own rollout meant we learned a great, great deal about what we liked and didn’t like — we’re not dependent on our vendor,” she says.

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close to Rs 2.7 lakh a month, much of the cost due to calls among its three facilities. The company couldn’t transfer calls between facilities, and none of its employees had their own extensions. Resnick thought VoIP should fix that problem. He had a laundry list of other things he’d like in a new phone system as well: a unified paging system, message boxes that combined voice mail and Outlook e-mail, and faxing from Outlook. He went to his telecom provider, SBC, which recommended a specific Nortel BCM (Business Communications Manager) and a third-party systems integrator to implement it. Resnick wasn’t very happy about being assigned to a third-party integrator, but he trusted that SBC knew what it was doing. He got a quote of about Rs 60.75 lakh for the system and its implementation. Things started to go wrong quickly. For starters, the third-party integrator seemed unfamiliar with the system, spending a good deal of time reading documentation. Worse, the system SBC had recommended didn’t actually have all the features Resnick

right: It let the company transfer calls over the data network, which almost immediately led to savings on the phone bill. Costs fell from Rs 2.25 lakh to slightly more than Rs 45,000 per month. But he was still paying SBC money for features he’d been promised but hadn’t received. So he went looking for a different VoIP system. The key now: He had learned how to probe vendor answers. For instance, he knew to ask if fax integration meant his users could print faxes from their desktops. He knew to ask whether a feature was built-in or came from a third-party company. And he knew to get documentation proving functionality. The pilot meant he had laid the foundation for VoIP. He’d assigned all his extensions and direct-dial-in numbers, and had installed a PRI (primary rate interface) line, which accommodates voice and data and allows both caller ID and direct-dial-in functionality on one T1 line, functionality you can’t get on a regular T1 line. He had also trained users on VoIP concepts. That meant that in February 2005, when he brought in a system from Shoretel, a VoIP startup, things went smoothly. His

“Doing our own rollout meant we learned a great deal about what we liked – we’re not dependant on our vendor.” — Donna Zett, CIO, Serta wanted. Those it did have didn’t necessarily work. For example, the receptionist’s console was built around software from yet another third party, and it crashed constantly. Suddenly, Resnick found his two-month implementation limping into month seven. As an added insult, he couldn’t even call someone at SBC to yell at them. SBC was in the process of merging with AT&T, and the people he knew had been reorganized into different jobs and in some cases had left the company entirely. Resnick might have washed his hands of VoIP, but the pilot did do one important job 60

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new system was up and running in less than a month, with almost all the features he had wanted. Better yet, it cost him less than SBC’s approach: about Rs 47.25 lakh. And he was able to ditch the SBC system. Resnick declines to point fingers at SBC, saying he was too quick to accept it when SBC told him VoIP is a “piece of cake.” Second time through, he made sure to communicate what he needed and make sure he understood the limitations of the system.

Manage Competing Priorities The problem: How do you roll out VoIP when top management has other priorities, and

34% of

companies are evaluating or piloting VoIP, 29% have no plans, 21% are rolling out, and 14% are fully deployed. Source: Forrester Research, Aug. 2006 study of 366 North American companies with domestic-only networks

when you need several third-party partners to go along with you? The answer: Realize VoIP pilots will take more time than most other pilot tests. Mike Benson wishes he were done with the VoIP installation going on at his company’s 30 call centers. Benson, executive vice president and CIO of DirecTV, hoped to be saving millions of dollars a month in phone bills with VoIP by mid-2006. Instead, he’s still working toward a secondquarter 2007 finish date. Benson wants VoIP because it costs DirecTV 1 to 2 cents to transfer a call from one call center to another. That doesn’t sound like much money until you realize that DirecTV spends about Rs 270 crore a year on telecom, about 75 percent of which Benson estimates comes from connecting calls between centers. VoIP could eliminate those transfers, saving DirecTV several million dollars a month on its phone bill. The good news when Benson’s pilot began: DirecTV had been planning an upgrade to MPLS (multiprotocol label switching) networking infrastructure and was upgrading its Avaya equipment already. So VoIP’s cost would be inconsequential. Benson piloted VoIP in one of the company-owned centers and found that it was “pretty straightforward” to

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implement. VoIP did require making sure switches at the center and outside of the network were IP-capable and had appropriate software in them. The bad news: Benson controlled only four of the call centers DirecTV uses. The other 26 were outsourced to three companies, primarily Convergys. Planning talks with his third-party providers went slowly. Convergys was also moving to an MPLS network, and the two companies planned similar network architectures and used similar equipment. But that wasn’t true for his other providers, which didn’t necessarily have the same priorities for IT, either. And Benson would get no cost savings if VoIP weren’t in place at both ends of the network. Today, Benson has learned some lessons about managing multiple vendors. While it takes time to nudge a service provider in a direction, it might not want to go, there are things that help, Benson says. In his case, having one large service provider and two smaller ones meant he could play them off against each other, to a point. The smaller providers wanted to get more of his business. So, they were more cooperative. This put pressure on Convergys to come around. (It helped that Convergys started to miss its service-level targets, which meant Benson could threaten to pull contracts.) Another lesson learned: VoIP may be at the top of your to-do list, but it’s probably not at the top of your organization’s. Chances are, a CIO will be pulled in unexpected directions during a VoIP pilot. Benson, who of course has to respond to other, competing needs from within DirecTV, is no exception. If customer service wants a new call center built, Benson needs to pull people from the VoIP project for the duration of the call center project. This year he’s had to build a new call center for DirecTV and help his third-party providers open two other call centers. Such dilemmas and diversions don’t dull Benson’s ardor for what he thinks will be hefty telecom savings. His centers stand completed, and he thinks by the end of 2007 all the third-party call centers

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VoIP Disaster Plans: Don’t Skimp Replacing the telephone company with VoIP comes with one major potential problem for companies: The Internet is simply not as reliable as landline telephones.“There are going to be problems, and times when things go down,” says Will Stofega, an analyst at IDC (a sister company to CIO’s publisher). “How you react to it is critical.” Especially if you are a CIO at a mid-market or smaller company, you may be pressed for disasterplanning resources, but don’t skimp, say CIOs who’ve been there. Marty Resnick, director of technology operations at Norman’s Nursery, made disaster recovery planning central to his VoIP planning. He made sure that there were still working analog lines at each facility, in case of network and power outages. He also made sure that if a single VoIP server crashed, the phones would roll over to a server at another location. IDC’s Stofega gives these tips for other CIOs planning for the worst while working toward the best: 1. After network testing, upgrade routing software where necessary and make sure it’s as bulletproof as can be. 2. Consider setting up a virtualized LAN or having a backup location for VoIP. 3. Bolster security safeguards to fend off denial-of-service attacks and other Internetclogging events. 4. Write a careful plan for an actual emergency — including who should be called, who should be onsite and who should call your provider. — M.F.

will also be done, though since some of DirecTV’s outsourced call centers use Nortel equipment, DirecTV still needs to test IP calls between Avaya equipment and Nortel equipment. Once this project is done, he’s got another VoIP pilot in mind, examining IP-enabled phones. He’s learned, though, to expect significantly longer planning time for VoIP projects, especially in a company where keeping the phones ringing is paramount.

equipment. That gives staffs a chance to gain experience with what remains an emerging technology. And makes it more likely that if the phones don’t ring, you’ll know why. CIO

Take the Cake Despite the issues that come with VoIP, Forrester’s Pierce says companies do want to adopt it. “The percentage of companies that believe they will stay on old technology indefinitely goes down and down and down,” Pierce says. For smart rollouts, she recommends the “chocolate layer-cake” approach. By that, she means implementing VoIP in phases. Use new sites or places where aging equipment or a growing workforce create opportunities for upgrading

Michael Fitzgerald is a freelance writer based in Massachusetts. Send your feedback to this feature at editor@cio.in.

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Pundit

essential technology

Being a Step Ahead of Potential Threats The threats to your organization's security don't always loom outside. Look within. It doesn't hurt to anticipate. By MICHAEL JUNG

security | Bad news. It’s all around you. Bad things happen all the time. The problem with human nature, though, is that until something actually happens, you don’t think about the things that you could have done to prevent or at least mitigate the risk of that bad thing actually happening to you. It doesn’t resonate, until quite frankly, it’s already happened. Up to that point, your behavior doesn’t change. It’s like the time I was robbed in Las Vegas at gunpoint, or the time that someone got a hold of my checking account number and started writing checks on it (those are stories for another day). After each of these things happened, I spent lots of time making myself and my family more secure. Unfortunately, most companies are like most people — they do only what is necessary to protect themselves from the obvious threats that they (or often their vendors) believe they can and should solve. If you think about the analogy of securing your home, it’s the ‘lock your doors and check the windows’ strategy. In IT security, this analogy usually translates into CIOs, chief information security officers and security administrators 62

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fixing the tangible problems that they believe they can solve with least cost and effort. Sound familiar? In the end, this usually means securing against threats posed by viruses, worms and trojans by buying firewalls, IDS/ IPSs, VPNs and so on and so forth. Great. Good work. Now, the network won’t be brought down by someone opening a virus laden email. Nice start. To me, the fundamental problem of security is about behavior. It’s about the behavior of developers when writing applications, the behavior of the low salaried IT admin who just got paid to download a bunch of customer data by some crooks, the behavior of the ‘looky loo’ employee snooping around in someone’s HR files when he shouldn’t be, the behavior of the new college grad who just started his job and thinks that using Kazaa on the network to download free music is completely acceptable. It is this behavior that is happening on the network and devices you manage and the applications you use and develop, by users that are part of your company. So much for locking the doors and checking the windows.

The problem is posed by the behavior of users — on the network and devices you manage and the applications you develop and use. So, as I evaluate new opportunities to invest in security, I’m looking for two things: (1) Companies that offer tools and technologies to help monitor, manage and enforce the right behaviors in people and devices; and (2) Companies that make it drop dead simple for IT folks to use their tools. It’s why we invested in Securify, and why I think companies like Fortify Software, which I haven’t invested in but think very highly of, have a huge opportunity in front of them. If you haven’t taken a look at these guys, I think you should, before that ‘bad thing’ happens to your company. CIO

Michael Jung is a principal with Panorama Capital, a venture capital firm established by the venture investment team of JPMorgan Partners. Send feedback to editor@cio.in

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