The Changing Role of the CIO
There is an interesting paradigm shift happening today among chief information officers (CIOs) in the consumer goods industry. The role is in a state of transition from just maintaining the status quo to powering business opportunities. Slowing the transition, however, is the generally accepted rule that more than 70 percent of a company’s IT budget must be spent on support and maintenance to simply “keep the lights on”.
During a recent web seminar, subject matter experts from Forrester Research, Dr Pepper Snapple Group and HCL explained why that rule should be challenged and provided real-world examples of how consumer goods companies can create tangible value by aligning business with IT.
The first presenter, Bill Martorelli, principal analyst for Forrester Research, discussed how IT services spending can be linked to creating business value rather than just being a cost reduction exercise. “It’s fair to say from a historical perspective that IT services buying decisions have often been associated with a desire to cut costs, not exclusively as we’ll see, but certainly it has been a common motivation for outsourcing,” he said. “But various forces and factors are combining now to create a bit of a changed picture that focuses on creating value from IT buying decisions.” Martorelli identified industry dynamics that reinforce an emphasis on costs, yet IT services buyers say that costs savings are disappointing and a lack of tangible business value also frustrates buyers. He provided names of outsourcing partners that offer value frameworks, like HCL’s business-aligned technology, and closed his presentation with recommendations for linking IT services spending to business value, saying, “it may not be easy at all, but it’s not impossible.”
Next, Dr Pepper Snapple Group's Senior Vice President and Chief Information Officer, Tom Farrah, shared how he leveraged IT to drive rapid continuous improvements in the business. DPSG’s IT organization structure is unique and business aligned – with each IT Vice President managing a portfolio of business processes, a portfolio of IT applications and a portfolio of operations. “Our job is to help the business grow and expand,” Farrah said. He shared examples of how IT is driving business value through partnerships, one of which included the relentless pursuit to reduce incident calls to DPSG’s service desk by more than 50 percent. “You’ve given [the customer] back time in their day, which results in productivity, and that is a measurable value to the business.” He also explained DPSG’s idea-sharing program, created in partnership with HCL, wherein business value-centric ideas can be communicated and evaluated through a main portal. Overall, Hannah credited $872K in business value to that initiative.
Lastly, HCL’s Global Head for Consumer Goods, Vijay Iyer, detailed his company's vision and mission around business-aligned IT and detailed HCL's new sourcing model that fosters high engagement visibility and IT transformation to unlock capital. “The end journey is in fact not just focused on IT-led parameters monitoring but on actually monitoring business processes because we believe that IT spend is there to generate and support the business,” says Iyer. “If that end goal is not well understood then we are just managing technology for technology’s sake. And, therefore, our view is to link every single activity.”
Click here to listen to this web seminar “CIO Paradigm Shift: From Keeping the Lights on to Powering Business Opportunities".
And as you listen, think about the CIOs whom you believe best exemplify and advocate the shifting role of IT in consumer goods. Then nominate them to receive CGT’s CIO of the Year Award, the industry’s first award that will recognize an IT leader who has made the largest demonstrable business impact within his or her consumer goods organization through the implementation and successful use of technology.
Related Articles:
Kimberly-Clark Announces New CIO
Conair Tames Big Data
Chiquita Relocates IT Infrastructure
During a recent web seminar, subject matter experts from Forrester Research, Dr Pepper Snapple Group and HCL explained why that rule should be challenged and provided real-world examples of how consumer goods companies can create tangible value by aligning business with IT.
The first presenter, Bill Martorelli, principal analyst for Forrester Research, discussed how IT services spending can be linked to creating business value rather than just being a cost reduction exercise. “It’s fair to say from a historical perspective that IT services buying decisions have often been associated with a desire to cut costs, not exclusively as we’ll see, but certainly it has been a common motivation for outsourcing,” he said. “But various forces and factors are combining now to create a bit of a changed picture that focuses on creating value from IT buying decisions.” Martorelli identified industry dynamics that reinforce an emphasis on costs, yet IT services buyers say that costs savings are disappointing and a lack of tangible business value also frustrates buyers. He provided names of outsourcing partners that offer value frameworks, like HCL’s business-aligned technology, and closed his presentation with recommendations for linking IT services spending to business value, saying, “it may not be easy at all, but it’s not impossible.”
Next, Dr Pepper Snapple Group's Senior Vice President and Chief Information Officer, Tom Farrah, shared how he leveraged IT to drive rapid continuous improvements in the business. DPSG’s IT organization structure is unique and business aligned – with each IT Vice President managing a portfolio of business processes, a portfolio of IT applications and a portfolio of operations. “Our job is to help the business grow and expand,” Farrah said. He shared examples of how IT is driving business value through partnerships, one of which included the relentless pursuit to reduce incident calls to DPSG’s service desk by more than 50 percent. “You’ve given [the customer] back time in their day, which results in productivity, and that is a measurable value to the business.” He also explained DPSG’s idea-sharing program, created in partnership with HCL, wherein business value-centric ideas can be communicated and evaluated through a main portal. Overall, Hannah credited $872K in business value to that initiative.
Lastly, HCL’s Global Head for Consumer Goods, Vijay Iyer, detailed his company's vision and mission around business-aligned IT and detailed HCL's new sourcing model that fosters high engagement visibility and IT transformation to unlock capital. “The end journey is in fact not just focused on IT-led parameters monitoring but on actually monitoring business processes because we believe that IT spend is there to generate and support the business,” says Iyer. “If that end goal is not well understood then we are just managing technology for technology’s sake. And, therefore, our view is to link every single activity.”
Click here to listen to this web seminar “CIO Paradigm Shift: From Keeping the Lights on to Powering Business Opportunities".
And as you listen, think about the CIOs whom you believe best exemplify and advocate the shifting role of IT in consumer goods. Then nominate them to receive CGT’s CIO of the Year Award, the industry’s first award that will recognize an IT leader who has made the largest demonstrable business impact within his or her consumer goods organization through the implementation and successful use of technology.
Related Articles:
Kimberly-Clark Announces New CIO
Conair Tames Big Data
Chiquita Relocates IT Infrastructure