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The CEO's View on IT Best Practices
In contrast to the Hackett survey, we may consider a report issued by Darwin Research, which cites the recommended best practices of Christopher Milliken, CEO of Boise Cascade Office Products. He offers the kind of in-depth view of best practices that I feel is needed to be consistent with my research on Responsive Organizational Dynamism. Milliken participated in the implementation of a large-scale Customer Resource Planning (CRM) system needed to give his customers a good reason to choose Boise. The project required an investment of more than $20 million. Its objective was to provide customers with better service. At the time of the investment, Milliken had no idea what his ROI would be, only that the project was necessary to distinguish Boise Cascade from a myriad of competitors in the same industry.
After the successful implementation of the project, Milliken was now in a position to offer his own thoughts about technology-related best practices that a CEO might want to consider. He came up with these six:
1. The CEO must Commit to a Technology Project: Milliken was very concerned to express the reasons why the CRM project was important; he was intimately involved with its design, and made it clear that he had to be consulted should there be any delays in the project schedule. KPMG (a major consulting firm) was also hired as a consultant to help implement the schedule and was held to the same level of excellence. What Milliken accomplished, significantly, was to show his interest in the project and his willingness to stay involved at the executive level. Milliken realized that the CEO must have an active role in the project, and not just allow his/her management team to get it done. Milliken, as many other CEOs, issued specific performance-related requirements to his employees and consultants. His participation sent a valuable message: that the CEO is part of the supporting effort for the project and is also part of the organization's learning process. Indeed, the situation that Milliken faced and resolved, i.e., to jump in without knowing the expected returns of the project, is exemplary of the core tenets of Responsive Organizational Dynamism, which requires the ability for an organization to operate with dynamic and unpredictable change brought about by technology. In this case, the technology was crucial to distinguishing Boise Cascade from its competitors. Thus, the most important best practice lies in the commitment and learning to the learning organization format.
2. Think Business First, then Technology: In order to understand why a technology is needed, there must first be a supporting business plan; that is, the business plan must drive the technology, or support its use. This best practice concept is consistent with my research. Another interesting and important result of the business plan at Boise was that it called for the creation of a centralized CRM system. Therefore, it became necessary to consolidate the separate business units at Boise into one corporate entity-thus providing central support and focus. The CRM project, through a validation process in a business plan, provided strategic integration. The strategy then influenced cultural assimilation and required a reorganization to implement the strategy or the new CRM system. Furthermore, Boise Cascade allowed its staff to experiment in the project, to make mistakes-without criticizing them. They were in effect implementing the Driver-related concepts of technology. These Driver concepts must be similar to the way organizations support their marketing activities, where they accept a higher error ratio than when implementing a Supporter activity. The CEO wanted everyone to give it his/her best and to learn from the experience. This position is a key best practice for the CEO: it promotes organizational learning throughout the business.
3. Handcuff Business and Technology Leaders to Each Other: Milliken understood that technology projects often fail because of a lack of communication between IT and other business entities. The project represented many known IT dilemmas, particularly relating to the new CRM system and its integration with existing legacy applications, and at the same time creating a culture that could implement the business strategy. To address this, Milliken first appointed a new CIO whom he felt could foster better communication. He also selected a joint project leader from the business side, thus creating a joint project leadership team. What Milliken did was to form a new community of practice that did not exist before the project. The project represented an event that fostered the creation of organizational learning opportunities. They enlisted the support of executive-level consultants to help finalize the business plan and marketing strategy as well as assist with change management. What exactly did Milliken do that represents a best practice? From an organizational learning perspective, he created communities of practice between IT and the business. That then is a true best practice for a CEO.
4. Get the Show on the Road: There was a not-to-be-questioned deadline that was instituted by Milliken. This type of management seems undemocratic, but it should not be confused with being non-participatory. Someone had to get this going and set expectations. In this case both IT and business users were set to make things happen. Senior management endorsed the project and openly stated that it represented what could be a one-time opportunity to "do something of great magnitude" (Dragoon, 2002). From a best practices perspective this means that the CEO can and should provide the leadership to get projects done, and that part of that leadership could be setting strategic dates. However, CEOs should not confuse this leadership with power-centralized management over IT related projects. Communities of practice still need to be the driving force for inevitable success in ROD. Another important factor was Milliken's decision to create dual management over the project. Thus, Milliken was able to create an environment that required discourse between IT and the business.
5. Win Over the Masses for Massive Changes: as stated earlier, the business plan called for a reorganization of other business units. This also required executives to rethink job descriptions and titles in relation to new processes. It also eliminated six redundant management-level jobs. Milliken engaged employees in a massive "external-internal" marketing campaign. Employees participated in ad campaigns, and brochures were created for all staff. A video was also produced that defined the benefits to Boise customers. In essence Milliken was committed to communication and training, knowing that not everyone is comfortable with change, and resistance in the ranks is inevitable. As a result, the education and training programs at Boise were not enough. What was lacking was true organizational learning and knowledge management. There are two best practices that were defined from this experience. First, the CEO needs to engage in actively showing the importance that technology has to the organization, not just from an economic perspective, but also from a staff development point of view. The second best practice comes from the example of what Boise Cascade did not do enough of: that is, provide organizational transformation through knowledge management, reflective practices, and communities of practice. This suggests that CEOs need to better understand and incorporate organizational learning concepts so that they can be the catalyst for change as they are in other areas of the business.
6. Know that Technology Projects Never End: Another way of saying this is that the technology will continue to be viewed as a means to transform the business on an ongoing basis. Indeed, Milliken was planning to spend more to complete all phases of its projects. So from a best practices perspective, CEOs must recognize that technology investment never ends, but it moves to other phases of maturation, similar to the Driver/Supporter life cycle. Finally, the buy-in to this reality assures the recognition of change through technology.
Next: 11 Best Practices of the Technology Mature CEO
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