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7/13/2005
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Add A 'C' For Customer To That CIO Title

Carlson's new CIO is also its chief customer technology officer--a job description that's been turning up at more businesses in recent months.

With the recent resignation of CIO Steve Brown, Carlson Cos. apparently decided that it would broaden the job description for Brown's replacement. Jeffrey Balagna will become the travel-services company's fist chief information and customer technology officer, with accountability for all customer-facing IT resources.

Balagna spent the last four years as CIO at Medtronic Inc., a maker of medical technology that, like Carlson, is headquartered in Minneapolis. Balagna and other Carlson execs couldn't be reached for comment. A Medtronic spokesman said Balagna has already left his old post.

In addition to his customer technology responsibilities, according to a statement from Carlson, Balagna will oversee deployment of a companywide enterprise-resource-planning system and will direct the transition of some of Carlson's IT business processes to IBM, which recently came under contract for an outsourcing agreement.

Carlson's move to expand the CIO role signifies businesses' growing recognition of the importance of customer relationships and data. AMR Research last week issued a report predicting investment in customer-relationship-management applications will consume 27% of the average IT budget in 2006, up from 16% in 2003 and 18.5% in 2004. On average, the 211 companies surveyed planned to increase spending on CRM technologies by 8.2% next year, a substantial jump from the 2.3% increases they reported this year.

AMR analyst Laura Preslan, one of the authors of the report, says there's a significant link between the findings and the customer-focused responsibilities showing up in IT executives' titles. Companies that have added chief customer officer positions, Preslan says, include Alcoa, Dreyfus, and United Airlines.

Ironically, many of the CRM deployments companies have invested in aren't yet delivering consistent customer data--a problem many companies are focused on solving. "They were fixing the issues around the edges instead of tackling the central issue," Preslan says.

Making executives accountable for improving the use of customer data is having another effect: nudging up the salaries paid to data architects. "They're not just doing data cleansing," Preslan says. "They're actually making business decisions about what each piece of data means so they can translate it for different departments."

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