Posts Tagged ‘decisions’

4 Ways That CIOs Can Start To Make Better Decisions

Wednesday, May 11th, 2011
Image Credit CIOs Need A Tool To Help Them Make Better Decisions

CIOs Need A Tool To Help Them Make Better Decisions

An important part of the job of being a CIO is the ability to make good decisions. Lots of good decisions. In fact, the ability to make more good decisions than bad decisions is arguably what allows a CIO to keep his / her job. Now the only problem is that it’s really, really hard to make good decisions all the time. To help you do a better job of this, I’m going to share with you four decision making tools that will help you every time you have to make a decision.

A New Way Of Making Decisions

CIOs need a new way to make correct decisions. Our ultimate goal should be to find ways to make the right decision more often than not. One way to do this is to adopt the “evidence based decision making” approach. This form of decision making rejects using gut feels and relying on past limited personal experience and instead is based on evidence and logic.

The problem that most CIOs run into when they try to apply evidence based decision making to their organizations is that it runs counter to the way that things are currently done. Every company has its share of stories about gutsy managers who just knew what the right thing to do was, and did it. What we forget are the stories about the managers who thought that they knew what to do and ended up doing the wrong thing.

Ask For Evidence

CIOs are always being presented with requests for something. More often than not it is for funding, but it can also be for resources or even simply for permission to proceed. You need to take a careful look at each of these requests.

When a CIO is using the evidence-based approach to making decisions, he or she needs to ask the people who are making the request for evidence. They are proposing doing something, they need to be able to prove to you that by taking the action that they want to take, good things will happen. If they can’t prove it, then you need to reject their request.

Look At Logic

When plans are presented to a CIO, they are often backed up with the results of surveys, charts and graphs of data, and lots of other impressive looking results. When presented with this type of information, CIOs need to be on the alert.

All too often in our very busy lives we tend to accept what is presented to us at face value. What we really need to be doing is taking a step back and looking more closely at the underlying data.

The question that you need to be asking yourself is if the results that have been drawn from the data really make sense. Are there any gaps or leaps in logic that really just don’t hold up? You’ll be amazed at how often you’ll find things that don’t support the conclusions that have been reached. When this happens, you need to send the team making the request back to the drawing board.

Experiment & Reward

Not every project is going to succeed. In fact, in the world of IT some projects fail in a spectacular fashion. Things really don’t have to be this way. If CIOs could become better decision-makers then a lot of this could be avoided.

One way to avoid big IT project failures is to encourage small IT project failures. That’s not as bad as it may sound. CIOs need to create an environment in which employees are encouraged to start pilot projects and to try out new ideas using trials before the CIO has to commit to a much larger project.

Many of these smaller projects will fail. This is a good thing – far better to have a small project fail and learn from it than have a much larger project fail and learn nothing. CIOs need to reward IT staff that work on projects that fail – everyone needs to see that there is much to be learned from each project no matter how it turns out.

Find Wisdom

Perhaps the simplest way for CIOs to make better decisions more of the time is for them to have one simple realization. If a CIO can understand that they don’t know it all, that there is still a lot that they need to learn, then they’ll be able to make better decisions.

Far too often CIOs assume that they know everything that they need to know in order to make the right decision. However, the reality is much different – there is no way that they know what they don’t know. Admitting that you don’t know it all is the first step in being open to collecting more information and becoming a CIO who makes better decisions.

What All Of This Means For You

All too often CIOs lose their job because they made bad decisions. It turns out that a big part of being the CIO is the ability to make a lot of good decisions. What is needed are tools that will help a CIO to do a better job of making the correct decision.

Four such tools exist and can be used by CIOs. The first is to demand evidence when a proposal is made. The next is to test the logic behind any proposal that is made. To ensure that the IT department can support the CIO in making good decisions, the CIO needs to allow trial programs to be run. These trials need to be allowed to fail and IT employees have to be rewarded for uncovering information before a bigger investment was made. Finally, CIOs need to teach their staff that they don’t know everything and everyone must respect the fact that there is much more for them to learn.

Although CIOs deal with technology, much of the their day-to-day job has to do with teaching. In order to make better decisions, they need to take the time to teach their IT department how to look at opportunities and how to use the information that is available to make the best decisions each and every time.

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World IT Department Leadership Skills™

Question For You: How do you think that a CIO should react to an IT trial program that failed?

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What We’ll Be Talking About Next Time

When you are CIO you will quickly come to dread (or maybe you already do) the annual strategic planning process for the IT department. Talk about choices: mobile devices, privacy issues, cloud computing – who can pack strategic planning for all of these issues into one short period at the beginning of the year – there’s got to be a better way

PayPal Outage Points To CIO Failure

Wednesday, September 2nd, 2009
Paypal's CIO Hasn't Been Doing His Job Correctly

Paypal's CIO Hasn't Been Doing His Job Correctly

The basic job of a CIO is to ensure that a company’s IT infrastructure operates smoothly and allows the company to conduct business. On Monday, August 3, 2009, PayPal’s CIO failed at this most basic of jobs.

A quick check of PayPal’s senior management structure reveals that they don’t have a CIO position (which in of itself is rather amazing), but Ryan D. Downs is their Senior Vice President, Worldwide Operations and so he’s their de facto CIO. What went wrong Ryan?

The Facts Behind The Failure

On Monday, August 3rd, Paypal experienced a world-wide outage that affected all of their customer facing systems. The effect of this outage is that millions of Paypal’s customers who rely on them to approve and complete financial transactions were unable to do so. This was a long outage – it started at 1:30 pm EST and lasted to until at least 6:30 pm EST.

Paypal is attributing this outage to “internal” issues.

Paypal is a huge business. In the most recent quarter, Paypal handled $16.7B in customer online commerce transactions. In the past the company has stated that they normally handle $2,000 in online transactions every second. Just in case you are doing the math, this means that this outage prevented at least $36M worth of business from happening.

What The CIO Did Wrong

I have no magic insights into what went wrong at Paypal, but it’s pretty easy to make a guess. Back in 2005, customers got shut out of Paypal for about 5 days when a software update went very, very wrong. I’m willing to bet that some sort of update process got away from them once again. This is just sloppy IT work.

This is exactly the type of basic “blocking & tackling” that CIOs have to get taken care of as part of building a solid IT foundation. Clearly this has not been done at Paypal.

The reason that this is such a scandal is that its happened at Paypal before. Once a problem is known, the CIO needs to step in and make sure that it will never happen again. We’re not just talking about establishing a fail-safe update process, but also making whatever changes are needed to the Paypal infrastructure in order to make sure that problems like this can’t ripple throughout the system.

Additionally, creating a process for rolling back changes is critical. If a bad change slips though the system and starts to go into production, you need to have the ability to get the system back to the way that it used to be.

Final Thoughts

Major outages like this reflect badly on all CIOs. There should be no reason that a outage like this should be allowed to happen especially since Paypal has had problems like this in the past. Paypal can’t claim that they didn’t have enough funding to prevent this problem – they are the fastest growing part of the eBay corporation.

In the end it all comes down to planning. Finding the time to gather the right people to run through “what if” scenarios and then following through with the recommendations that come out of these meetings is what every CIO needs to do. If Ryan takes the time to do this, then he will have found a way to apply IT to enable the rest of the company to grow quicker, move faster, and do more.

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What We’ll Be Talking About Next Time

Hewlett-Packard is a huge IT products and services company that lives and dies by the actions of its sales teams. Making sure that the sales teams get paid should be a simple task right? Think again…

Faux Market Secrets: How CIOs Capture Innovation

Monday, July 13th, 2009
CIOs Can Use Faux Markets To Identify Innovative Ideas

CIOs Can Use Faux Markets To Identify Innovative Ideas

So picture this: you’re a CIO and you desperately want to be seen by the rest of the C-level executives as something more than a simple cost center. What to do? If only there was some way that you could tap into all of that incredible creative energy that we all know lives in the IT department.

If you could harness that energy and apply it to innovative projects, you’d be a company hero. Guess what? The power of Faux Markets is exactly what you need to do this…

What Is A Faux Market?

You know that things are getting fancy when we start using French words! A Faux Market is simply a term that refers to using simulated market forces to make a decision. Perhaps an example would show what I mean. A good case study would be GE Research.

Back in 2005 GE Research had a problem. They had too many product ideas that had been submitted and only $50,000 to spend on investigating them. Clearly they need to make some hard decisions as to which ones they would persure.

The way they picked which projects to work on was by using a faux market. They had their 85 employees spend three weeks buying and selling any one of 62 proposed projects. At the end of the three weeks, GE ended up with a  prioritized list of the top projects that its employees thought had the most value. The project that won was an machine intelligence algorithm that a researcher had proposed but which had not yet traveled through the normal management bureaucracy.

Why Use Faux Markets?

All too often IT departments have a bewildering array of possible projects, technologies, or directions that the department can choose. Sometimes senior management will huddle and make a decision, sometimes no decision gets made. Faux markets offer an alternative.

A faux market tool allows a firm to quickly sort though large numbers of projects or proposals in order to attempt find those that will provide the most bang for the buck. Firms believe that this approach offers them the best chance of finding the next blockbuster product or solution.

Not A Silver Bullet

Faux markets can be a big help; however, as with everything else they do have their drawbacks. One such drawback is the that the voting process does not provide much insight - there may be no penalty for backing a bad idea. Just because a proposal is popular does not necessarily guarantee commercial success.

Final Thoughts

Using faux market tools to quickly sort though a large stack of ideas can provide IT departments with a way to identify innovative ideas no matter where they come from. However, a group vote alone isn’t enough in most cases.

A two step process where voting is initially used to narrow a large list down into a more manageable list of less than 100 candidates is a good first step. The next step can be to use a prediction market allow employees to buy and sell the candidates in order to see which ones go up in value. This will reveal the true winning ideas and you will have found a way to apply IT to enable the rest of the company to grow quicker, move faster, and do more.

Questions For You

How do you process new idea suggestions today? Do you have employees vote on things in order to sort them out? Are these just popularity contests or do they take market factors into consideration? Do you think that faux markets could help you capture more innovative ideas? Leave me a comment and let me know what you are thinking.

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What We’ll Be Talking About Next Time

As a CIO, you’ve got some challenges facing you. You’re managing a diverse and potentially distributed work force of highly skilled and talented IT professionals. You need to find a way to keep them challenged, and yet at the same time enable them to find ways to work together. Have you considered Alternate Reality Games?

Who Gets To Make Decisions In Your IT Shop?

Monday, February 23rd, 2009
Where IT Decisions Get Made And Who Makes Them Is Very Important

Where IT Decisions Get Made And Who Makes Them Is Very Important

A recent study of 89 senior IT executives in a wide range of industries was done in order to get the answer to a seemingly simple question: who’s in charge here?

In these days of reigned in IT spending, decisions about how much to spend and what to spend it on seem to have migrated even farther up the command ladder. It turns out that this is causing an IT credibility gap: others are making decisions that we then have to deliver on. Is this any way to run a company?

I’m hoping that we can all agree that having IT work hand-in-hand with the rest of the company has never been more important. This means that getting decision rights and accountability right is now critical to an IT department’s success.

If you boil it down, IT departments are responsible for not only hardware and software assets, but also for all customer and supplier data along with many automated business  processes. This means that if IT decision making is not properly placed, the impacts will be felt company wide.

There are two ways to get decision making wrong. The first is called a techocentric gap and this is when IT is in charge of all decisions. We’ve all see what this can do. The other is called a business gap – this is when all decision making is done outside of the IT department. Neither of these solutions is the right way to go.

In the end, there are really three types of IT decisions that need to be made. Technical decisions around IT infrastructure and architecture probably need to reside primarily within IT. IT investment and strategic decisions need to be made jointly by IT management and business top management. Finally, once again IT top management and business top management need to work together to make outsourcing decisions.

Where do IT decisions get made in your IT department? Is there a gap between IT and the business? Does IT get held responsible for decisions that they played no role in making? Leave me a comment and let me know what you are thinking.

What Is The #1 IT Skill That A CIO Needs To Have?

Monday, December 29th, 2008

CIOs Need One Critical Missing Skill In Order To Make Good Decisions

CIOs Need One Critical Missing Skill In Order To Make Good Decisions

Today’s CIOs are expected to have many more sets of skills than those that they followed did. One can only suspect that the CIOs of tomorrow will be faced with even higher expectations. Cloud computing, outsourcing, insourcing, business alignment, top line growth, bottom line growth – which one is the most important to know the most about? It turns out that the answer is none of these.

A little secret that nobody ever talks about is that the higher in an organization that you rise, the less “real work” you actually get to do. Many first time IT managers struggle with this new reality – they are the ones who can’t help but do the work of those that they mange.

Jack Welch probably said it best in his biography Jack: Straight from the Gut when he said that as CEO of GE, really all he was able to do was to hire and fire people and approve budgets – that’s it! CIOs are in the same situation, so what is the #1 skill that they must have?

Simple, the ability to reach conclusions when all that they have to work with is ambiguous evidence. Think about it for a moment, all of the information that a CIO gets has been heavily filtered by the rest of the IT organization. If there are any unpopular opinions, then they have probably been censored before reaching the CIO. An slanted or partisan viewpoints have been masked as objective arguments. There is even the possibility that honest mistakes have been made.

CIO’s need to have a type of analytical rigor that will allow them to make sense of the information that is presented to them. This is the skill that will allow them to sort through all of the information that crosses their desk and will allow them to dive down and finally get to the real story.

The big question for tomorrow’s CIOs is how can you get the bottom of things when all that you have to work with is incomplete information? How can you present yourself to your colleagues and to your IT department as an authentic IT leader in such a way that others will be willing to follow you?

One of the most dangerous things that can mislead a CIO is his/her own opnion. Sure we all have an opinion; however, if we pre-judge a situation and reach our own opinion too quickly then we can find ourselves falling into a pattern of belief. We may do this because it’s simple to do or because it fits some particular social need.

However, the problem with our opinions is that they don’t necessarily have to be true. If a CIO chooses to believe something because of just the information that has been presented to him/her, then its going to be very hard to get him/her to surrender that belief.

Too many of us like to say that we keep an open mind when we really don’t. In order to be an effective CIO both today and tomorrow, we’re going to need to make sure that we work very hard to make good decisions. This means that we’ve got to realize that we will never have complete information. What we need to do is find ways to use the partial information that we have to get to the bottom of the issues. Then, and only then, will we be effective CIOs.

Have you ever had to make a decision without all of the information that you needed? How did you go about reaching a decision? Was it the right decision? What would you have done differently if you could go back and make that decision again? Leave me a comment and let me know what you are thinking.