Software // Enterprise Applications
Commentary
1/28/2002
03:33 PM
Connect Directly
RSS
E-Mail
50%
50%

Ask The Secret CIO: Would You Agree To This Deal?

The Secret CIO responds to readers about meetings and other interpersonal relationships. It isn't the meeting style that's at fault, he says, but the inability of corporate leadership to gather data and do the right thing promptly.

How do I get our CIO to award business to one of my potential customers?

Dear Mr. Lovelace:
I'm a sales guy. One of my sales prospects is bidding on a hosted applications deal with my company. One of its senior people asked me to help them with securing the business on this bid. The deal involves the CIO of my company (a Fortune 300 firm) and is valued at roughly $6 million.

The vendor put its proposition to me: If I help it win the ASP contract, it would reciprocate with a like-sized deal, buying $6 million from me. To accomplish this, I would need to persuade my CIO that his decision to buy from this vendor (or not) will bring another piece of revenue (or not) to one of the corporation's business units.

As a CIO yourself, what arguments might persuade you to consider hiring the vendor, enabling a reciprocal deal? By the way, the CIO is the sponsor of the Request For Proposal for the application service provider deal.

Looking forward to your insights.

Thanks,
JFS

Dear JFS:
Let me understand your situation. The idea is that if the CIO gives the applications services provider contract to this one bidder, the vendor has promised you an equivalent amount of revenue. You want to know how to persuade the CIO to see things your way.

Ah, where to begin?

Well, if I were your CIO, my first reaction would be to wonder about the legality of such a quid pro quo deal. It's probably being advertised as an open Request For Proposal. At the very least, I would never enter into the agreement you propose, unless the Request For Proposal were to be modified to say that offsetting revenues to our firm would be a consideration of the award. Of course, I would still probably call for legal advice, while you were sitting in my office, since I am adverse to breaking laws that I may not even know exist.

My next reaction would be to wonder why I should put at risk $6 million dollars of my outsourcing work by picking a vendor based on kickback business (whoops, bad words) to your unit. No doubt, I would feel compelled to inform you that I'll choose the best service the company needs, because we could burn more than your potential $6 million in revenue if I make a bad decision.

At this point, I might even take a detour and point out that I will be spending $6 million of bottom-line money (i.e., profit) on the ASP agreement, while you may be bringing in $6 million of revenue. Knowing how testy I can get, I probably would ask you our margin on your $6 million sale, and if it's worth the risk. After all, if your business will make an incremental 20% (a nice number) that is still only $1.2 million bottom line, vs. $6 million of the company's funds I'm putting on the line if I make a bad decision.

Finally, I would be skeptical that you or I could trust this vendor to deliver $6 million of business on a verbal commitment. What if I award the contract and then you don't get the order?

So, in summary, I guess that the kind of arguments that might persuade me would be:

  1. I am confident that what you suggest is perfectly legal.
  2. We agree to modify the Request For Proposal to let everyone know that the decision will be based in part on how much business our company gets from bidders.
  3. You get an iron-clad order for the $6 million in business that executes automatically if I give them the ASP contract, and
  4. The vendor you propose is equally qualified to do the job that I want done.
My guess is that your CIO won't see it a whole lot different from the way I do. So you may want to concentrate on getting that business from the ASP vendor on the merits of what you have to sell rather than on what your CIO might buy.

What you need is a good management consultant!

Dear Herb:
I read your column, Loud Break In Code Of Silence, (April 2, 2001, p. 120) with interest.

If your executive team doesn't know how to name the elephant in the room, I suggest you bring in a competent executive coach or management consultant with chutzpah to help you see, hear it, and start working with it.

By the way, I teach a management course to IT tech people at the university level. Shall I use this example in my class?

Kind regards,
Barbara

Dear Barbara:
If you do teach your class about what happened in the senior officer luncheon between Gornish and Kratmeyer, may I suggest that you do not urge them to yell, "Elephant!"

What we had was a profound disagreement between two senior officers, with most people in the room unaware of the cause. Jumping in, without understanding the situation, by anyone other than Phil, the CEO, would have been unwise and counterproductive. As in a family, what is said in anger frequently cannot be unsaid; and further, stepping into the middle of an unspoken disagreement is purely stupid. What would have been the purpose?

As hard as it might be to accept, when two senior level executives start to have a fight, the only person who can resolve the issues (other than the participants) is the boss or possibly a good friend of each one. In any case, you don't do it in public--even when that public is the peer group.

Barbara, I am afraid that "bringing in a competent executive coach or management consultant with chutzpah" would be the last thing I'd do. What would be accomplished? Getting Sid and Kratmeyer to admit in public that they are furious with each other? No, the way Phil handled it (Bad Blood In The Executive Suite) solved the problem, and did so with a minimum of collateral damage. Sometimes it's better to let the elephant leave the room at its own pace than try to teach it to dance to your tune.


The sounds of silence

Dear Mr. Lovelace:
I have been amused and challenged by your witticisms and observations. Your latest thoughts about Omerta in "Loud Break In Code of Silence" pointed out the need for more violations of it.

Meetings of top officers are too often worthless, despite the best intentions of the organizer. Unfortunately, the subtleties of political jockeying prevent real airing of issues that are critical to business success.

Keep stoking the brain.

Cheers,
Selim Hassan

Dear Selim:
While you are correct that too many meetings are worthless (regardless of the level of the people involved) it isn't the subtleties of political jockeying that prevent the real airing of issues--it's the lack of management resolve.

Regardless of how information is gathered, any good organization has to make sound decisions based on facts--no matter how unpleasant they may be. It isn't the meeting style at fault, but the inability of some corporate leadership to gather data and do the right thing promptly.

We tend to think meetings are the problem, because we frequently misunderstand what type of meeting we're attending. There are three types of successful meetings. The first is for information gathering. The second is the decision-communicating session. The third is the decision-making meeting. Woe to he or she who confuses which one is being attended. The result of that mistake is like bringing a tennis racket to a football game.

I learned on my way up the ladder that it wasn't a good idea to go into a meeting without a fairly high level of confidence in knowing the likely outcome. My mentor taught me that the purpose of most meetings was to communicate decisions to a group, not to make them. Since he was European, I assumed I was dealing with a cultural difference. In fact, I found out that what he was talking about was a difference in style between the top of the management pyramid and the rest of the layers. The real issues have to be faced; the particular forum used (in Phil's case, it was a party) is optional.


If the boss is honest, usually so are the troops

Dear Herb:
Your column dealing with ethics (No Such Thing As A 'Free' PC) was excellent. It reminded me of a ethics study I heard about on the radio. The basic result was that a formal ethics program was meaningless if the CEO was unethical. Conversely, an ethical CEO typically meant the employees behaved ethically even without a formal ethics program.

Keep telling it like it is!
Keith

Dear Keith:
The rules of management aren't all that complex. People tend to act the way you do, not how you say to do. I believe it is called walking the talk. I can't think of a time it doesn't work that way.



Your letters to my print column and this E-mail forum raise some serious issues about managing information technology in today's world. Since today's world is essentially absurd, my serious responses may sometimes sound a little whimsical, and my occasional whimsical one, serious. In any case, if you want to participate, or comment, write to me. I reserve the right to edit for size and content. Just sign your E-mail the way you want it to appear online. And feel free to join me in my discussion forum.

As I've mentioned, I am planning to put my InformationWeek columns together into a book with a little bit of additional commentary around the events and people about whom I write. If you would like to be notified of such an event, please drop me an E-mail and I'll build a mailing list to let you know about it. Just use the word BOOK as the subject line.

Comment  | 
Print  | 
More Insights
Building A Mobile Business Mindset
Building A Mobile Business Mindset
Among 688 respondents, 46% have deployed mobile apps, with an additional 24% planning to in the next year. Soon all apps will look like mobile apps and it's past time for those with no plans to get cracking.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest - August 27, 2014
Who wins in cloud price wars? Short answer: not IT. Enterprises don't want bare-bones IaaS. Providers must focus on support, not undercutting rivals.
Flash Poll
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
Howard Marks talks about steps to take in choosing the right cloud storage solutions for your IT problems
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.