Doug Tracy Transforms CSC IT In His First 100 Days and Beyond
by Peter High, published on Forbes.com
07-21-2014
Doug Tracy is an IT transformation specialist. He has had three IT executive posts in a row that required major transformations, at Rolls Royce, at Dana Holdings, and in his current post as Chief Information Officer of Computer Sciences Corporation. Befitting an executive who has a master’s degree in software development and management, an MBA, and who spent time as a consultant for Boston Consulting Group, a significant portion of the transformations that Tracy has overseen has focused on making his IT department be bigger sources of value creation on behalf of the enterprise. At CSC, this has meant introducing a “Customer Zero” strategy, in which CSC IT leverages the product and service offering of the company, in many cases before they are introduced to true customers. In so doing, it has woven IT more firmly into the broader fabric of the company, and positioned the department to be a strategic partner in honing the product and service offering. He also created an Applied Innovation team, so named because he seeks to apply the innovations that are derived from the Technology Office of the company, as well as from vendor partners that he engages. This has meant that just as he has had to focus on rendering IT more efficient, he has also had a number of levers to pull in developing new innovations within IT and for broader use across CSC.
(This is the 19th article in the CIO’s First 100 Days series. To read past articles with the CIOs of companies like Caterpillar, Time Warner, Intel, Johnson & Johnson, Deutsche Bank, and General Electric, please click this link. To read future articles in the series, please click the “Follow” link above.)
Peter High: Doug, you have been CIO at a number of organizations prior to your current role as CIO of Computer Sciences Corporation. Can you speak a little to what advantages those experiences had as well as what new challenges you faced in the early stages of this role?
Doug Tracy: I think the biggest advantage comes from the fact that I am no stranger to transformation, since this is my third transformational role in a row. My first transformational role as CIO began in 2004, upon joining Rolls-Royce as EVP IT for North America and Global IT CTO, where I had the responsibility of transforming the IT organization, strategy and architecture. My next role, as VP and CIO of Dana Holding Company, saw a transformation on a much larger scale as the company was just coming out of Chapter 11. This trend of transformations on larger and larger scales continued once I joined CSC because this transformation encompassed the entire business, requiring a totally different pace of change that even I was not accustomed to at first. CSC had brought on a completely new senior management team, had an innovative new business model and was moving to a more centralized structure with standard global processes, shared resources and learnings.
As with all new roles I’ve undertaken, I spent a significant amount of time before my start date in preparing for the role. For example, I spent time researching annual reports and learned as much as I could about the company and people. I even spoke with the former CIO of Misys, who had worked for Mike Lawrie, my soon-to-be CEO, to understand Mike’s leadership style. As a result of this preparation, I found the situation fairly similar to the expectations I had; the speed and scale of transformation and the number of balls in the air simultaneously being the biggest challenges. I realized there was a certain degree of risk with the pace of change, but I believed we would face greater risks by transforming at a slower pace. Most people regret moving too slowly, a regret I knew CSC would not share.
Additional topics covered in the article include:
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Jamie Miller’s Journey From Chief Accounting Officer To CIO Of GE
05-19-2014
Jamie Miller runs information technology for one of the most complex and admired companies in the world: General Electric. One would think that the CIO of such a company would have a deep technical background, perhaps having an advanced degree in an engineering discipline along with multiple stints as CIO previously. Miller’s resume may not have these items on it, but she has something that IT departments increasingly need: financial expertise.
IT used to be a part of Finance in many companies, as some of the earliest technologies developed at big companies was technology applied to the general ledger, accounting systems more generally, and the like. Likewise, when technology was taught at business schools, it was often a sub-set of the accounting department. It is perhaps ironic that a growing number of CIOs have grown up through the Finance function. Miller has leveraged her background to make IT more transparent and accountable, and ever more cognizant of the value that it delivers to the enterprise. CIOs with or without financial backgrounds should follow her lead.
(To listen to an extended audio version of this interview, please click on this link. This article is both a part of the “CIO’s First 100 Days” series and the “Business CIO” series. To receive additional articles in the series, please click the “Follow” link above.)
Peter High: Well Jamie, yours is a very interesting path to CIO. In fact you, as I understand it from our past conversations, don’t have any prior formal experience in IT – it’s not as though you grew up from programmer to your current post – and I wonder actually, as a relative outsider to the function, what advantages you found to approaching IT with a different set of sensibilities and witth a different set of experiences?
Jamie Miller: I grew up in Finance. I was GE’s Controller and Chief Accounting Officer and in that and other Finance roles I really learned a lot about how companies are put together, you know the product, the market, the processes, the systems and really we a company does very well, and where we have got some issues and I think having that type of insight is really critical coming into the CIO role. As a relative outsider to IT, I am able to view technology and our solutions from a business perspective, first and foremost. I believe I have helped challenge our thinking around how we drive business outcomes or how we can be better aligned with the company’s goals. So, it sort of gives you this outside in view.
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Chris Davis suggests how leaders can extend beyond just writing SMART goals to successfully manage through metrics and drive behavior.
March 2013
This post is the Executive Summary to the five-part series. To read and download the full paper, click here.
Executive Summary: How do we know we are successfully pursuing our strategy?
Without awareness and accountability to metrics, leaders can’t know how successful their strategy is. Developing a cascading metrics-centric accountability framework is a critical first step to driving desired behavior. However, a well thought out design does not necessarily promise an effective implementation of such a framework. Therefore, leaders must consider and actively address the management dimension of metrics to ensure their organization maintains focus, alignment, and accountability for pursuing the company’s strategy.
Let me first address a common question: “what is strategy?” One commonly held definition of “strategy” is: “an integrated set of actions designed to create a sustainable advantage over competitors(1).” Based on this definition, the first natural question is: “Why do we need a strategy?” Having a strategy is critical for any endeavor so that there are no wasted efforts in an “integrated”, focused attempt to accomplish a set of objectives. There is not enough time in the day or money in our pockets to endlessly and carelessly pursue what we hope to accomplish, and a strategy helps us accomplish our objectives efficiently and effectively. The next question then is: “how do we determine if we have succeeded?” The key word to putting any strategy into practice, and enabling measurement, is “action”; actions can take place at varying degrees of breadth, focus, and granularity, and organizations can gauge the degree to which these discrete events change the status quo. Without measurement, the stewards of any strategy will not be held accountable for the quality of the strategy, and the evaluation of accomplishing one’s objectives becomes a vague and subjective exercise.
When developing a “strategy”, organizations regularly discuss various hierarchies of intent, but are not always able to differentiate or align missions, visions, business strategy, functional strategy, operations, and tactical plans (among others). In order to determine the success of any strategy, organizations must clarify the relationship between these conceptual elements, and how one element can drive the other. In order to narrow its focus, this article will treat only four main tiers in a strategic cascade (in order):
“Actions” are best described in verbs, which is why words like “grow”, “improve”, “increase”, “reduce”, and “optimize” are popular choices when articulating a strategy. The power of these simple words lies in that they imply the potential for quantification. With quantification comes the ability to know whether or not your organization is successfully achieving what it desires to, as well as the rationale for either staying course or changing tack. Quantifying, assessing, and acting on business performance metrics improves decision making, leads to greater accountability, and ultimately increases the likelihood of achieving a strategy. One study has shown that data-driven decision making can improve output and productivity by 5-6%(2), a significant return on effort for organizations who face densely competitive industries.
The other key words in the aforementioned definition of strategy- designed, integrated, advantage, and sustainable- offer instruction on several themes that can help organizations better manage through metrics.
There is a frequently cited “best practice” acronym for designing metrics frameworks, called SMART, which encapsulates many of the aforementioned themes and helps organizations outline useful metrics that truly assess the success of strategic pursuits(3). There are several industry interpretations of what the acronym stands for, but one common interpretation is that it stands for Specific, Measurable, Attainable, Relevant, and Time-bound (please see Table 1 in the appendix for other industry iterations of this framework)(4). While this commonly held interpretation of the SMART framework is quite useful in developing a strategically-aligned metrics framework, it does not completely address the need to manage an organization through the metrics. Therefore, in order to fully realize the value of a robust metrics framework that assesses success at the Vision, Objectives, Tactics, and Projects level, I propose considering additional management dimensions to the SMART framework:
The above “design” aspects of the SMART acronym should be augmented by the “management” dimensions in order to successfully implement a metrics framework that drives:
To reemphasize the point: it is not enough for managers to simply write objectives or goals, and the following table summarizes how leaders can successfully address the various management dimensions of SMART that are a critical next step to success:
While aligned to the SMART acronym, the management dimension does not necessarily follow a logical order, but does contain several interdependencies and overlap. Organizations that address these management dimensions when designing a strategically-aligned metrics framework will be able to move beyond the ivory-tower exercise of strategy creation to the grounds of value realization. The remainder of this article describes and explains the importance of the management dimension, as well as how your organization’s newly SMART metrics framework should align to your broader strategic framework.
Click here to read and download the full paper.
(1) “Thinking Strategically”. McKinsey Quarterly, June 2000.
(2) Brynjolfsson, Erik et. Al. “Strength in Numbers: How Does Data-Driven Decisionmaking Affect Firm Performance?”. Social Science Research Network, December 12, 2011. <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1819486>
(3) Doran, G. T. “There’s a S.M.A.R.T. way to write management’s goals and objectives”, Management Review, Volume 70, Issue 11(AMA FORUM), pp. 35-36. 1981.
(4) “4 – SMART metrics”, HowTo.ComMetrics. <http://howto.commetrics.com/smart-benchmarking/>, “SMART Criteria”, Wikipedia, accessed September 29, 2010. <http://en.wikipedia.org/wiki/SMART_criteria>
In an installment of the CIO-Plus Series in Peter High’s Forbes Technovation column, Chris Laping, SVP of Business Transformation and CIO of Red Robin Gourmet Burgers talks about how to be a change agent from the perch of an IT leader.
12-03-2012
In a recent article, I mentioned the trend in companies around the US and beyond of expanding the CIO’s responsibilities based on the translation of good work done in IT into other divisions and departments in the company. I refer to this phenomenon as the CIO-plus role. I kicked off the series last week with an interview with Puneet Bhasin, the Senior Vice President – Technology, Logistics and Customer Service, Chief Information Officer of Waste Management. (Past articles in the series can be found here) This week, I am delighted to continue the series with Chris Laping, the Senior Vice President of Business Transformation and Chief Information Officer of Red Robin Gourmet Burgers (NASDAQ: RRGB).
Laping has what I believe to be the ideal background for a CIO. He has an engineering degree as an undergraduate, an MBA, he spent time as a consultant, and though he is not yet 40, he has been a CIO for ten years. He joined Red Robin as CIO in June of 2007, and after transforming that organization, added the role of SVP of Business Transformation to his title in February of 2011, noting that the company hoped that his “transformation” activities would not be limited to IT. Now it seems that each analyst call that Red Robin CEO Stephen Carley leads features initiatives that Laping and his team leads or co-leads, such as the development of the Red Royalty customer loyalty program that he oversaw in concert with the company’s CMO, which has contributed substantial sales lift in those stores where it has been fully implemented.
Laping does not hide his desire to take on even greater responsibility in the future, and he pays much more than lip-service to this ambition, as he continues to drive value from his CIO-plus perch within his company.
Peter High: You have been a Chief Information Officer since your late 20s, Chris. When you started as CIO, what did you hope to do in that role?
Chris Laping: If I honestly reflect on my goals at age 29 as a CIO in the GMAC world, it really boiled down to a few things: 1) be a leader that focused more on WE than ME; 2) be transformative and care about my company’s business more than my passion for technology and; 3) innovate in new ways that weren’t just limited to the technology toolbox.
Ultimately though, the number one metric I used to understand if I was succeeding was progress. I’ve never believed that people expect perfection or the total solution overnight; they are happy if you are making meaningful progress on a daily basis.
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In the first article of his “Technovation” column for Forbes, Peter High speaks with Marriott CIO Bruce Hoffmeister and Cisco CIO Rebecca Jacoby about the importance of IT leaders being able to article value through financial terms- a language everyone in the business can understand.
Article by Peter High, published on Forbes.com
10-01-2012
Whenever I have the occasion to speak with successful CIOs at length, I make it a point to ask them which skills they believe have served them best as they have ascended into the biggest chair in the IT department. Some classic responses understandably crop up time and again. These leaders work in the fast-moving world of IT, and only with a deep knowledge of and curiosity about technology can they stay abreast of developments in the field. Many CIOs will also mention the importance of management skills, given that they need to harness the talents of a large, diverse team of people who run the gamut of Myers-Briggs personality types.
Over the last few months, one skill has been brought up with increasing frequency: a facility with the language of business, and, in particular, finance. A facility with this discipline ensures that IT is contributing to the same key performance indicators that the rest of the organization is, and it also proves that IT is responsible at managing the funds it is given. More importantly it engenders trust among the rest of the executive team, giving the IT team the credibility to push strategic plans, attend board meetings, and to a greater extent earn a place among the direct reports to the CEO.
IT has long been accepted as a cost center of the company and as a cost of doing business. IT leaders have traditionally not even been asked to present the return on investment (ROI) of the projects they pursued because it was rare that there would be one. Perhaps this helps explain the subservient nomenclature of “IT and the business,” as though they are separate things.
For a long-time, IT departments measured success based on obvious IT metrics such as systems up-time and on-time/on budget/on scope of projects. As important as these are, they are introductory or foundational metrics. It is important for IT leaders to use the same success metrics that the rest of the organization does. In so doing, they begin to think about their portfolio of investments’ potential to contribute to the ultimate success of the business.
I recently spoke with Bruce Hoffmeister, Global CIO of Marriott…
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Randy Spratt is the EVP, CIO and CTO of McKesson Corporation, a $112 billion company based in San Francisco, providing medicines, pharmaceutical supplies, information and care management products and services across the healthcare industry. In this one-on-one Q&A, he tells CIO Insight: “In my mind, business Nirvana is top-line growth. IT Nirvana is making everything the same, efficient, secure, leveraging economies of scale. In this scenario, IT controls things to a greater extent. In [too] many organizations, there is a pendulum that swings between these two scenarios, between Business Nirvana and IT Nirvana, never quite reaching either side before the momentum shifts in the other direction.”
by Peter High, in CIO Insight
10-24-2011
Randy Spratt is the EVP, CIO and CTO of McKesson Corporation, a $112 billion company based in San Francisco, providing medicines, pharmaceutical supplies, information and care management products and services across the healthcare industry. Spratt had been CIO since July of 2005, responsible for the global applications that serve the entire corporation and for the overall IT strategy and information security for the company. In April 2009, he added the chief technology officer role. In the company’s Technology segment and, to a limited degree, in its Distribution segment, Spratt is responsible for guiding the technology direction, strategy, and quality of the medical systems that the company sells, implements, and supports in the healthcare community.
Given dual internal- and external-facing roles, Spratt has had a chance to think a lot about the value the IT departments ought to deliver to the companies and customers that they serve. He also recognizes that they must solve the riddle of both remaining efficient and secure, while also forging efforts to innovate and add to the top-line of the company, as well. CIO Insight contributor and Metis Strategy President Peter high recently spoke with Spratt about his perspectives on “IT Nirvana” and how it can be attained by any CIO.
CIO Insight: Randy, you have spoken about the two sources of value that a CIO must bear in mind, one is growth oriented, and the other is leverage oriented. These can be at odds. How have you successfully managed this paradox?
RANDY SPRATT: It truly is a paradox. But it is the paradox that any business leader, any CEO faces. On the one hand, you need to innovate and be agile to serve the strategies of the business. On the other hand, you have a lot of activities that are commodity driven, and if you are not competitive with other entities that can provide those services, then you will be at a competitive disadvantage as a company. The more you can standardize, the more you can gain economies of scale and render the IT operation more efficient. On the other hand, the business needs non-standard technologies for innovation.
In my mind, business Nirvana is top-line growth. This suggests business-driven IT activity, and a high degree of IT agility. The businesses will want and expect new devices, new capabilities, new applications, new tools to reach and delight their customers. They are looking for social networking, iPad apps, smartphone apps, and linking into cloud-based services to reach their markets and deliver innovative products and services. IT nirvana is making everything the same, efficient, secure, leveraging economies of scale. In this scenario, IT controls things to a greater extent.
In many organizations, there is a pendulum that swings between these two scenarios, between Business Nirvana and IT Nirvana, never quite reaching either side before the momentum shifts in the other direction every three to five years. An innovative CIO is hired who focuses almost exclusively on enabling the business vision, and, for a time, achieves tremendous things for the organization. In many cases, this is a CIO within a business unit that is seceding from an overly controlled central function. In the process, our innovative CIO creates a shadow infrastructure, replicates existing functionality, and buys products and services at sub-optimal purchasing power and from unproven vendors. Projects fall behind, costs accelerate, and the desired speed and agility are not attained.
Next, a cost conscious CIO is brought in to rectify these issues. The business executives speak with great frustration about the cost and inefficiencies of the IT department and demand double-digit percentage cost reductions. That new CIO spends a lot of time fixing the mess, cleaning up the architecture and infrastructure, cutting staff, and instituting practices to make things more efficient. That CIO de-emphasizes innovative, top-line growth opportunities in favor of more efficient operations, greater buying power through standardization and scale, and more stable, reliable operations through solid IT processes. After a period with a lack of innovation, however, that CIO’s business leader peers become antsy about the lack of velocity and agility and the unproven top-line value IT is achieving, and the pendulum swings back again.
(…)
The remaining questions covered in this article are:
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Discover the techniques you can use to transform your IT department and develop into a truly world-class company.
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Peter High, President, Metis Strategy, LLC
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World-Class IT: Why Businesses Succeed When IT Triumphs
Hugging the business too closely can squeeze the lifeblood out of IT
by Peter High
Much has been written about the need for information technology departments to align with the business units within their companies. IT should understand the company’s strategic direction, so the thinking goes, and develop solutions to meet those needs. This trend led many IT departments to develop a return on investment (ROI) analysis for each project.
Although the advantages of IT’s intimacy with the business abound, the concept raises the question: Is it possible for IT to focus on the business at its own expense?
As IT achieves more value on behalf of the business, it tends to focus less on IT, reminding us that IT’s alignment with business must be balanced with an alignment of business to IT. The former has been sacrosanct, whereas the latter is rarely considered. For a true partnership between business and IT, IT must manage its infrastructure and educate the business about technology. If IT ignores its own needs, the business suffers from increased downtime and IT’s inability to scale appropriately.
In the late 1990s, the IT department at Hilton Hotels performed well, but was viewed as supportive to the business. Underscoring that role, the then-CIO reported into hotel operations.
After acquiring Promus Hotel in 1999, the organization began viewing IT differently.
Promus had developed a property management technology called System21. Under the stewardship of Tim Harvey, Hilton’s executive vice president and chief information officer, the company leveraged System21, now called OnQ, into a tool that integrates reservation management, property management, CRM, revenue management, forecast and content management, Balanced Scorecard activities, and a host of other services for all the Hilton brands. Unlike competitors who have different solutions for these functions, now, as Hilton adds about 300 hotels annually, each one need only invest in OnQ, and a holistic technology solution is in place. Although Hilton remains a hospitality company, technology is one of the main sources of its competitive advantage.
As Hilton IT delivered increased value, Harvey realized the business needed to be educated about IT to ensure enough attention was spent managing systems infrastructure. He ensured IT staff spent time with business colleagues to understand their needs and to learn business language. This enabled Hilton IT to better communicate its plans, including metrics related to on-time, on-scope, and on-budget.
For many companies, infrastructure remains the domain of techies. At Hilton, IT communicates its plans to improve the infrastructure across the business.
Dean Permenter, vice president, shared infra-structure services, explains, “We are constantly improving infrastructure efficiency through virtualization, where several applications share the server, storage, or backup capacity. The result: A true enterprise solution instead of individual systems requiring additional management and resources such as power and cooling.”
Hilton IT decreased baseline costs (those costs required to “keep the lights on”) even as the hotel grew. By providing the business with value metrics to represent such infrastructure successes, the inner workings of IT become tangible.
Too often, business-IT alignment is taken in that order. To be truly consultative to the business, IT must educate the business on its own needs and constraints and how its capabilities can serve the business.
Aligning IT to the business is just the first step toward opening the lines of communication, which should flow in both directions if companies wish to fully leverage IT.
Originally published in CIO Digest, January/February 2007 . Copyright ©2007 Symantec Corporation, republished with permission.
