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<HEAD><TITLE>The CEO's Role in IT Decisions</TITLE>

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<H1><LEFT>The CEO's role in IT decisions</LEFT></h1>

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<H4><LEFT>Look both ways, Knowing when to act :</LEFT></H4>

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<H4><ALIGN=LEFT>To avoid IT investment disasters, corporations must rethink when and how senior management's talents should be tapped.</LEFT></H4>

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<H4>By Bill Carico</H4>

<P><ALIGN=LEFT><FONT SIZE=+2>A</FONT><FONT SIZE=3>ttention CEOs: Over the last several years information technology professionals have witnessed a steady stream of top-down

directives. The mandate: convert to client/server and open systems.A huge percentage of these conversions have failed, and approximately

one third of these projects are abandoned. Everyone deserves their fair share of the blame --

including top management.

<P>True story: A typical but anonymous company was using mainframe and PC/LAN technology to provide on-line services for more than 1500 users. But senior management was concerned the company might be left behind in the massive shift to client/server. Articles everywhere claimed that

scrapping the mainframe meant big cost savings, improved productivity, faster time to market, empowerment of end-users and

more flexible access to information, so they asked their specialists if an overhaul of existing IT infrastructure

were a good idea. The carefully considered reply came back from the glass-house: "Absolutely not!"</P>

<P>Immediately an independent consultant was hired to author an objective, tie-breaking opinion.

Not surprisingly, the consultant's advice was "The future is the future. Reengineer everything, shed the mainframe, it takes guts to be a leader."</P>

<P>Management took the hook. A New Age CIO was hired to replace the Iron age incumbent. The incoming CIO, assuming the obsolescence of the

IT staff, hired outside consultants to work directly with end-users on the New Age system. He also put a freeze on any spending for mainframe technology.</P>

<P>After thirty million dollars, two years of development and a carefully phased migration, the New Age system was declared production ready.

Unfortunately, it didn't work. Critical, end of year financial reports could not be generated. No contingency or parallel plans had been put in

place. Within a week, the New Age CIO resigned.</P>

<P>Senior management turned to the company's mainframe graybeards for help. The salvage operation was completed in 8 weeks, storage requirements were cut by 60% and response time was cut in half. More important the system could actually do a trial balance. Now fearful of after-shocks, end-users in the individual business units want nothing more to do with the $30 million client/server system.</P>

<H4>Avoiding Reruns</H4>

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Sound vaguely familiar?

How can senior non-technical managers participate in IT decision-making without diminishing the chances of success?

To avoid replaying the same scene, senior business executives must focus on clearly describing the problems and opportunities -

yet must resist the urge to manipulate or dictate the choice of technological solutions. The head of Information Technology must be

delegated the responsibility to solve problems or take advantage of the opportunities -- within agreed business parameters.

Many successful companies have chief technologists in board-level positions where they can contribute properly to business

strategy deliberations, especially those related to IT.

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Your toughest challenge will be to staff qualified technology practitioners-from the chief technologist on down. For the last 10 years,

the IT industry has suffered from a continuous brain drain, leaving "paratechnologists" in charge. The end result is an all-time-high

failure rate for deploying new platforms and new applications. Some analysts estimate as high as 90% of new applications under-acheive what was

originally commissioned by the end-user. As with the heart and lungs, care of vital information lifelines should only be entrusted to a qualified physician. Prescription without proper diagnosis is malpractice, so beware of techno-quacks who talk of paradigm shifts and use lots of trendy buzzwords. Also be skeptical of vendors who "sell high," suggesting CEOs and CFOs make massive technology purchases based

primarily on marketing glossies and 35mm slide presentations. Whenever top management interferes with product selection,

inferior products avoid close scrutiny that may otherwise reveal higher-than-expected cost and lower-than-expected functionality. Such failures are the legacy of the mindless rush to many of the so-called client/server and open-systems alternatives, though few companies want to admit their

mistakes publicly. CEOs must resist the seductive Siren call of ads and articles promising silver bullet solutions that lead to "management by

magazine." Though hordes of suppliers and journalists may tout the merits of in-vogue technology, all who may do so have one thing in common: They haven't taken the time to understand your business.

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