Cisco CIO: Communicating IT`s Value

Cisco’s CEO, John Chambers, often says something about my role that’s rather entertaining: “Your job is to think of what I think of before I think of it, and have it ready to go when I think of it.”

My conversations with Chambers and other executives revolve around a crucial element: value. My CEO measures our value based on whether or not my team and I are supporting Cisco’s strategic growth initiatives. There’s an underpinning of operational excellence in every discussion about value, but since we have that pretty well taken care of, we talk mostly about strategy.

See Also: The CIO Strategy for 2010

Our IT organization has to have an architectural strategy that allows us to respond to opportunities. We have to have the processes to move toward those architectural goals. And we need to have the right culture, one that clearly shows how to help everyone in the organization move in the right direction.

But it’s just as important to communicate what we’re doing. That’s where a lot of IT organizations struggle: They can do a lot of great things–and they know they can do a lot of great things–but they need to communicate the strategy behind it all.

Recently, Chambers and I have been talking about the simplest way to communicate at the highest level, and we agree that it’s to talk about “time to capability.” If he needs a particular capability to move a business process forward–whether it’s an entirely new business model or merely a new way of communicating via video–it comes down to how fast we can produce it so the company can take advantage of it. Further, we must then be ready to scale that capability quickly for the entire organization.

But it’s not just the boss that IT needs to communicate with. I assign responsibility to my IT leaders to manage relationships with other functions, our councils and boards, and those constituencies that fall outside traditional organizational bounds.

There are five critical value conversations we have with those groups. The first is strategic alignment–that is, conversations focused on gaining a strategic understanding of our business partnerships. This is a clear exchange to understand the general aspirations of the business constituent, as well as the specific near- and medium-term priorities. In these conversations, we seek to understand the strategic imperatives of each specific group. And while we’re at it, we bring ideas to the table, demonstrating which IT capabilities can help them achieve their goals.

Second, we speak with our constituencies about those capabilities–particularly about costs, risks and change management. In essence, this is “IT portfolio planning.” We’ve always had these conversations, but they’re changing significantly due to the power of virtualization and available services.

Third, of course, we need to have a quarterly value discussion that determines whether or not we’re doing what we said we would. This includes operational review of IT services—cost, quality and impact–the business metrics, as well as program status and changes.

Fourth, we as an IT organization need to take stock of our general progress toward bringing value to our business partnerships–and make sure that our strategy (especially around architecture) is helping us bring benefits in the fastest, most effective, and most strategic and ongoing way for the company.

So there’s this aggregate discussion that begs these questions: In this new world of IT, are we reusing each other’s services to benefit the entire company? Are we generally doing things faster? Are we generally doing things of higher business value impact?

The data from this aggregate IT value discussion helps us determine if we’re on track. But it also helps us decide where we should innovate or invest to help everyone move forward.

It also helps us to gain broad knowledge about how we can reuse technology that works for one group in another business process. It may sound like a technical review, but it’s not–it’s about leveraging services and creating a virtuous circle of value that IT can bring to the table–and bring rapidly.

The fifth conversation, of course, is using that same information for annual budget planning, and to show the high-level value of IT as a methodology for continuing to invest in technology.

Put all those conversations together and we have a comprehensive view across our company, ample ability to communicate and demonstrate IT’s capabilities, and a highly effective mechanism for understanding our own strengths and weaknesses. And that’s a good recipe for any CIO to succeed in 2010.