Many entrepreneurs get a misty look in their eyes when they recall their days as chief cook and bottle washer.
"When there were just two of us, we planned the computer systems and we also laid the carpet in the new offices," one panelist said at the annual CIPS Informatics conference, held recently in Victoria.
But there comes a time when somebody needs to take charge of information technology, especially in a company where information flow is the lifeblood. That person usually gets the title of chief information officer (CIO) and the relationship between the CIO and CEO can make or break a company. This was the subject of a fascinating panel at Informatics 2006, Canada's largest gathering of IT professionals.
The three Victoria-based companies chosen for this year's executive roundtable all rely heavily on IT:
* Abebooks brings together independent booksellers for online sales and was named one of the top e-business sites in the world at the UN-sponsored World Summit Awards in 2003.
* Power Measurement offers power monitoring services to save companies money on energy, and in 2005 became part of Paris-based electricity giant Schneider Electric.
* Custom House is the largest independent foreign exchange company in North America, and lives and dies by the speed and accuracy of its online currency trading systems.
Custom House president and CEO Peter Gustavson noted that a company's CIO can be "either the great enabler or the great disabler.”
A good CIO, he added, should be able to read financial statements, should go out on sales calls with the sales manager, and should sit with the accounting people "to see what a pain it is to reconcile financials."
Gustavson's comment was echoed by Custom House CIO Eugene Nizker, who said, "it's not IT that's crucial; it's the business that's crucial."
Gustavson gave examples of times when good IT advice has helped boost his company. Before he had a CIO, he asked an IT-savvy friend to have a look at his IT systems because he was afraid that the technology could not keep up with the volume of currency trading as the company grew.
The friend took a look at the systems and chuckled, saying, "Well, you're running Foxpro.”
Foxpro was a good database system for its era, but its heyday was in the 1980s. This led Gustavson to ask his friend for some candidates for CIO, and Nizker was chosen.
Gustavson seems very happy with the choice. "I was on a trade mission to Thailand recently," he said. "The question came up about doing our online business in other languages. So I called Eugene and asked how hard it would be to translate our site into Thai."
Obviously the answer came back as a thumbs up, because Gustavson says they're now pursuing opportunities in Asia.
One theme that arose in several conference sessions was the obligation of IT professionals to say "no" to projects that just won't work. Of course, this is difficult because the company can just go find another CIO who says "yes," and then attempts to put lipstick on the pig.
And if they can't find a yes-man or woman in Canada, there's the whole world of IT outsourcing, especially to the BRIC (Brazil/Russia/India/ China) countries. Outsourcing is a big worry for Canadian IT folks.
In a keynote speech, Industry Canada assistant deputy minister Michael Binder warned the group that the ICT centre of gravity is shifting to emerging players such as India and China. He noted Canada's share of North American foreign direct investment plummeted from 21 per cent in 1990 to 13 per cent in 2002, adding that U.S. protectionism remains a challenge.
More worrisome yet, he cited a 2004 Conference Board study that shows multinationals do not rate Canada highly as a future production location.
But there are still some great Canadian success stories. Power Measurement was acquired in 2005 by Schneider Electric, which has 85,000 employees worldwide and 2004 sales of 10.4 billion euros.
But being taken over can provide its own IT headaches, said Power Measurement's business technologies manager Jordon Dagg, who admits that the acquisition threw a monkey wrench into their IT planning. He added that one of his staff, upon hearing of the deal said, "we weren't meant to be acquired, we were meant to acquire other companies."
Dagg's boss, operations vice-president Jacques van Campen, agrees that some IT work went down the drain, but he says he's glad they had a structure in place. "You have to at least have your general direction established so when the world changes, you can react to it."
Abebooks' co-founder and chief technology officer Rick Pura agreed, though he said some change is foreseeable. "There are some curve balls that come out of nowhere, but there are also some where you just weren't looking."
One area where the CEOs and CIOs parted company was on the value of metrics to gauge the performance of IT departments. The CIOs generally thought that they would lead to just focusing on a specific number, such as percentage of system uptime. CEOs tended to want some kind of performance indicator, and Custom House CEO Gustavson even said he's toying with the idea of bringing in IT experts from another company to do a sort of "peer review" of his company's IT operations.
Everyone agreed that the CIO should have a seat at the management table, though there was consensus that this should be earned through showing real interest in the business and not just viewed as an entitlement.
As for companies that don't give their CIOs a voice in management, Custom House's Nizker had a slightly flippant answer, but one that rang true with the panel.
"If, as CIO, you can't manage to communicate the value of IT to your CEO," he said, "you might as well prepare your resume, because your company probably won't be around in a few years anyway."
(CIPS honoured 18 of Canada's IT leaders with the new designation of Fellow of CIPS, "awarded to IT professionals who have made an outstanding contribution to the advancement of the profession or industry.” Tom Keenan, FCIPS, I.S.P., CISSP is among them. He is also a professor at the University of Calgary and can be reached at keenan@businessedge.ca)
