http://www.informationweek.comInformationWeeken-usCopyright 2012, UBM LLC.2012-11-26T09:06:00ZAre you an aspiring CIO? Listen to what these leading CIOs say it will take for you to reach that coveted position.http://www.informationweek.com/global-cio/interviews/what-cios-want-in-their-successors/240142418?cid=RSSfeed_IWK_authors<!-- KINDLE EXCLUDE --> <div class="inlineStoryImage inlineStoryImageRight"> <a href="http://www.informationweek.com/news/galleries/global-cio/interviews/232700431"><img src="http://twimgs.com/informationweek/galleries/automated/772/01_Steve-Haindl_tn.jpg" alt="10 CIOs: Career Decisions I'd Do Over" title="10 CIOs: Career Decisions I'd Do Over" class="img175" /></a><br /> <div class="storyImageTitle">10 CIOs: Career Decisions I'd Do Over</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div> <!-- /KINDLE EXCLUDE --> So you aspire to become a CIO, or at least move well up the chain of command. It's a complex job that requires a range of technical and business skills and experience. Just understanding the nuances of "the business" isn't enough -- it's long past time for CIOs to move beyond the "alignment" rhetoric and get on with creating customer-focused business opportunities powered by technology. <P> I recently participated in a panel session at <a href="http://www.interop.in/">Interop Mumbai</a> in which four leading Indian CIOs discussed the attributes they're looking for in a successor. In preparation for that session, I talked with four CIOs in the U.S. about the same subject. Here's what they say they're looking for in their top people. <P> <strong>Multidimensional leaders.</strong> "They may be brilliant technologists, but without the business engagement and leadership skills, they will not make it to the higher level," says Dave Bent, CIO of United Stationers, who advises would-be CIOs to gain experience in a variety of business and IT roles. <P> Jerry Johnson, CIO of Pacific Northwest National Laboratories, a research lab under the auspices of the Department of Energy, puts the emphasis on breadth of IT experience: software development, infrastructure, operations, architecture, project management. "Consequently, I encourage -- but don't force -- lateral movement within the organization," he says. <P> <strong>[ The role of the CIO is changing. These innovations can help you keep pace. See <a href="http://www.informationweek.com/global-cio/trends/5-innovative-ideas-for-enterprise-cios/240142317?itc=edit_in_body_cross">5 Innovative Ideas For Enterprise CIOs</a>. ]</strong> <P> <strong>Customer-focused product and brand champions.</strong> By "customer," we're not talking about the company's IT users. We're talking about the people who buy your company's products. Do you meet and talk with them on a regular basis? Do you know them? <P> Customer skills are particularly important for CIOs at technology companies, where the CIO often doubles as a dog-food-eating product spokesman. But a customer orientation is critical for all CIOs, says Kent Kushar, CIO of <a href="http://www.informationweek.com/global-cio/interviews/how-gallo-brings-analytics-into-the-wine/240006776">E. & J. Gallo Winery</a>, who's as comfortable at wine-tasting events discussing vintages and palate taste zones (I've seen him in action) as he is at board meetings explaining analytics and supply chain management. <P> The best CIOs consider themselves retailers and bankers and manufacturers first, technologists second. (But don't underestimate the value of being a first-class, well-rounded technologist.) <P> <strong>Players.</strong> The best CIOs get to know, on both a professional and personal level, the senior line execs responsible for delivering their companies' core business results. "They ask them how things really work, how decisions get made," says <em>InformationWeek</em>'s <a href="http://www.informationweek.com/global-cio/interviews/secret-cio-meet-the-manager-who-will-rep/229200270">Secret CIO</a>, who works for a $1 billion-plus company. "They figure out the results those execs are accountable for and, most important, how the execs' performance is measured." <P> Bent wants CIO candidates to have had exposure at the board level. "The CIO has to have the same broad leadership characteristics as any other C-level position -- listening, communicating, as well as leading," he says. Rajesh Uppal, CIO of Indian carmaker Maruti Suzuki, says tomorrow's IT leaders must "empathize with and understand their users and then come back and offer some value." <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> <strong>Battle-tested warriors.</strong> CIO candidates must show demonstrable wins on projects, IT and otherwise. "The best indicator of success is success," Kushar says. Our Secret CIO relates the time he asked one of his direct reports to improve customer satisfaction with the company's phone system. "She established call-handling benchmarks. She interviewed VPs and LOB managers to understand how they measured customer satisfaction. She learned about call centers. She talked with customers. She put a technology project in place as well, and when process changes were completed, she demonstrated, using the same metrics, that satisfaction levels had increased significantly." <P> <strong>Self-starters and go-getters.</strong> Arun Gupta, CIO of Indian pharmaceutical company <a href="http://www.informationweek.com/global-cio/interviews/when-incremental-it-change-wont-cut-it/240010562">Cipla</a>, is looking to add 35 IT specialists to the 17 people now in the company's core IT group, among them a chief information security officer and SAP lead. "Are they going to put their neck on the block, irrespective of whether I agree or disagree?" Gupta says. <P> V. Subramaniam, Asia-Pacific CIO of Otis Elevator, says he wants people with "fire in the belly and fire in the eyes." He also emphasizes "the discipline of the execution. They have to make things happen, without excuses." <P> <i>For the 16th consecutive year, InformationWeek is conducting its U.S. IT Salary Survey. To date, more than 200,000 IT professionals have participated in this survey. Take our <a href="http://informationweek.2013ITSalarySurvey.sgizmo.com/s3/?iwid=pl">InformationWeek 2013 U.S. IT Salary Survey</a> now, and be eligible to win some great prizes. Survey ends Jan. 18. </i>2012-11-19T11:02:00ZTwo prominent big thinkers think it is. But I&#8217;m not buying their unsupported arguments.http://www.informationweek.com/global-cio/interviews/is-technology-innovation-too-incremental/240142291?cid=RSSfeed_IWK_authorsGarry Kasparov and Peter Thiel, in a <a href="http://www.ft.com/intl/cms/s/0/8adeca00-2996-11e2-a5ca-00144feabdc0.html#axzz2CKkhPSgF">recent column</a> for the <em>Financial Times</em>, argue that true innovation-led economic and social progress is a thing of the past. Ever since the breakthroughs of the 1950s and '60s (jet aviation, the integrated circuit, nuclear power, communications satellites), this country has "discarded a century of can-do ambition built on rapid advances in technology and replaced it with a cautiousness far too satisfied with incremental improvements," the authors argue. <P> The column is breathtaking in its sweeping, unsupported generalizations and its omission of countless examples to the contrary. Apparently lost on Kasparov, a former chess champion beaten in his prime by a masterfully programmed supercomputer, and Thiel, a co-founder of PayPal, a product of the Internet revolution that has transformed how people pay for goods and services, is the irony of their untenable position given their own run-ins and rich experiences with innovative technology. <P> "The genuine progress in IT from the 1970s up to the 2000s," they write, "masked the relative stagnation of energy, transportation, space, materials, agriculture and medicine." Really? <P> Stem cell research is the integrated circuit of modern healthcare, a seminal breakthrough that promises to drive cures for decades to come. Is the mapping of the human genome an "incremental" advance? What about techniques for tapping billions of gallons of previously inaccessible natural gas and oil reserves? What about the launch of the Hubble telescope and the automated exploration of Mars and other planets? What about the mass production of electricity-powered cars? The world's population has doubled since 1970, partly because healthcare advances have lengthened life spans, and somehow food supplies managed to keep pace -- all while the agriculture industry stagnated? <P> Thiel's a sharp guy and a contrarian thinker. I cited his provocative "education bubble" thesis in a column last year, in which I agreed with him and went on to argue that the <a href="http://www.informationweek.com/global-cio/careers/down-to-business-higher-education-is-ri/229500624">higher education market is ripe for technology disruption</a>. Kasparov, the Russian chess master and political activist, is clearly no intellectual slouch either. Which makes their diatribe in the <em>Financial Times</em> all the more perplexing. It says at the end of their column that they were due to participate that evening in a debate on technology at the Oxford Union, so maybe they were testing the waters by firing a few torpedoes. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> At least the authors give the IT industry some props -- sort of. "Today when people say 'tech' they think of a small cohort of computer-related companies rather than the continuing transformation of every industry that people envisioned back in the 1950s," they lament. Perhaps the reason people don't think of the likes of FedEx and Vail Resorts and John Deere and Union Pacific when they think "tech" is because those companies' profound technological advances are now so ingrained in the customer experience or are so embedded in their supporting infrastructures that people take those advances for granted. <P> Technology's ability to transform companies and industries isn't a function of how high profile that technology is, but how valuable it is in improving products (simple online package tracking, a social skiing experience, remote diagnoses of vehicle problems, efficient and reliable freight hauling), as well as in improving supply chain management, manufacturing, distribution, sales, marketing and other support functions -- without sticking out like a sore thumb. <P> The rest of the <em>Financial Times</em> column is a jumble of non-sequiturs about short-sighted investment practices, the inability (and ability) of governments to foster innovation, the systemic shortcomings of Apple and Google, and the merits of private versus public corporate ownership -- all to exhort the masses to accelerate the pace of technical innovation. "Above all the future will be created by individuals," say the authors. No kidding. Then what? <P> <i>Predictive analysis is getting faster, more accurate and more accessible. Combined with big data, it's driving a new age of experiments. Also in the new, all-digital <a href="http://www.informationweek.com/gogreen/111912/?k=axxe&cid=article_axxt_os">Advanced Analytics</a> issue of InformationWeek: Are project management offices a waste of money? (Free registration required.)</i> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/83/9496/IT-Business-Strategy/informationweek-december-17-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1354/smallcov2.jpg" alt="InformationWeek: Dec. 17, 2012 Issue" title="InformationWeek: Dec. 17, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="url_to_come">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE --> <P>2012-11-05T09:06:00ZCIOs need to be technical, without apology, just as chief medical officers need not apologize for their grounding in medicine.http://www.informationweek.com/news/240012735?cid=RSSfeed_IWK_authorsAre people losing respect for the CIO profession, or have they just lost their perspective? While other C-level executives command authority and are lauded for IT savvy if they know how to buy a cloud service, CIOs are nitpicked for spending too much time on their core technology competency and not enough time parked in other parts of the business. <P> In a recent column, "<a href="http://www.informationweek.com/global-cio/interviews/are-the-cio-and-it-organization-replacea/240008574">Are The CIO And IT Organization Replaceable?</a>" I wrote that CIOs need to form stronger bonds with their C-level peers and take on formal responsibilities outside of the IT organization. One former CIO, CEO and COO wrote to me to object. Why do other C-level execs think they can assume the IT function, he wrote, and why do CIOs appear to have an "inferiority complex" about their technical capabilities? The writer, Steven Poole, whose career spanned senior executive positions in the public and private sectors in Canada, raised other valid points. <P> Some clarifications are in order. CIOs need to be technical, without apology, just as chief medical officers need not apologize for their grounding in medicine. CIOs don't necessarily need a degree in computer science or engineering, but they must have experience managing and developing applications, systems, projects and architectures. <P> There are exceptions to this rule: the HR or customer service exec who steps in and runs a first-class IT organization. But those execs are usually placed in the CIO position to fix a dysfunctional organization, institute cost discipline, bring silos together or instill a customer focus. And then they're rotated out. Rarely does the nontechnical CIO thrive in that position long term. <P> But that doesn't mean CIOs should rest on their technical laurels either. While Poole noted that other chiefs (HR, marketing, finance, etc.) "are generally quite secure in their seat in the executive boardroom" without feeling pressure to move outside their core competencies, CIOs sit in a different place. Because they're building systems for sales, marketing, logistics and other departments, CIOs must understand those areas far better than the average exec. And don't think for a minute that other executives aren't called on to expand their expertise, and even move into positions outside of their core areas. <P> Consider the CFO position. In a 2005 report titled "<a href="http://www.boozallen.com/media/file/145602.pdf">The Activist CFO</a>," CFO Research Services and Booz Allen Hamilton urged chief financial officers "to take on an expanded and increasingly activist role within their companies ... not just supporting the business with information and analysis, but also ensuring that the entire enterprise delivers on its commitments." The study went on to say that while the activist CFO "may sound a lot like a CEO, an overall leader of the enterprise and a super-line manager," he or she must remain committed to the core job: finance. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> Likewise, we're not asking "activist CIOs" to become superheroes, but we're urging them to get more experience in operational and customer-facing roles. Whether that experience requires formal stints in sales or procurement or manufacturing or customer service -- or just a more hands-on relationship with the people running those areas -- depends on the organization and executive. <P> When I recently asked one leading CIO (who came up through the technical ranks) what he's looking for in a successor, he immediately talked about breadth of experience, and not just in IT. "I would personally like to see more rotations through business roles than we have managed to date," he said. That's not because he has an inferiority complex about the importance of technical acumen. It's because he understands that when your position is intertwined with so many lines of business, it's essential to truly understand their processes, challenges and opportunities. <P> In the end, I don't think Poole's view is all that different from mine. "CIOs have a unique position because of their influence on information and business processes," he wrote. "Any CIO who only manages IT operations is clearly not contributing sufficiently at a C level. This is no different from the CFO who is really just an accountant or the [chief human resources officer] who is merely a recruiter." <P> Poole continued: "A good CIO knows how to leverage IT to enable the business in a manner that is evident to the executive team. The principle is the same for all C-level executives. CIOs simply need to take their seat at the C-level table."2012-10-29T09:06:00ZFor Indian pharma company Cipla and its new CIO, IT transformation is all or nothing.http://www.informationweek.com/news/240010562?cid=RSSfeed_IWK_authorsNo business technology buzzword gets worn out quite like "transformation," but there's no other way to describe what Indian pharmaceutical company Cipla is embarking on. <P> The 77-year-old company, publicly traded but family controlled, is one of the world's largest generic drug makers, with a presence in more than 170 countries (half its revenue comes from India). But until six months ago, it didn't have a CIO and was the poster child for shadow IT. Each company department negotiated with tech vendors on its own, deployed its own systems, and then looped in the IT department -- which consisted of only 17 core internal people, serving a company with 20,000 employees. <P> Enter Arun Gupta, whom Cipla recruited earlier this year from retailer Shoppers Stop to bring discipline and vision to the company's IT. I caught up with the soft-spoken Gupta earlier this month at Interop Mumbai, where he put his IT transformation efforts into the context of a broader business restructuring underway at Cipla, which has also brought in new chiefs of HR, supply chain, international marketing, strategy, legal, and other functions over the past half year. <P> Early on, in talking with colleagues and employees about their views of the company's IT, Gupta says he heard three main complaints: IT doesn't deliver what we need; we can't get the information we need when we need it; and we have too many systems that don't interoperate. <P> It's not for lack of investment. Cipla spends about 1% of its $1.4 billion in annual revenue on IT, and it's "not shy about investing in people, processes and manufacturing facilities," Gupta says. The problem was lack of coordination and oversight of the company's myriad IT vendors and systems. <P> <strong>[ A new <em>InformationWeek</em> survey says IT has reason to worry. See <a href="http://www.informationweek.com/global-cio/interviews/business-users-satisfied-with-it-think-a/240009535?itc=edit_in_body_cross">Business Users Satisfied With IT? Think Again</a>. ]</strong> <P> Gupta's first major step was to consolidate Cipla's six data centers to a single collocated one and revamp its network around a mix of multiprotocol label switching (MPLS) and <a href="http://en.wikipedia.org/wiki/Metro_Ethernet">metro Ethernet</a> links. The company's ongoing application rationalization is a "bit more complex," he says. The plan is to reduce more than 600 database servers to 100 and reduce the company's scores of ERP, CRM, HR, document management, laboratory information management and other pharma-specific apps to about 15 total. Gupta says he's also fixing Cipla's "broken" implementations of Pilgrim (quality assurance and compliance) and IBM Cognos (business intelligence) software. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> Looking to make a difference on the frontlines, he's focusing on Cipla's medical reps: the employees who sell the company's products to doctors. Already, Cipla is one of the few pharma companies that doesn't pay its reps based on sales, he says, and it wants to enhance its reps' engagement with doctors with a new off-the-shelf software tool that lets them share information on clinical trials and medical studies. The goal is to increase the average time a rep spends with a doctor from one minute to five, a small but significant increase. Gupta estimates that the new tool also helps reps save as much as three hours a day on planning and reporting activities: accessing customer data, tracking sales activity and filing expense reports. <P> Cipla plans to replace the 8,000 laptops its reps use with 10,000 <a href="http://www.informationweek.com/software/windows8/ballmer-windows-has-great-tablets-for-th/240010024">Windows 8 tablets</a>. It will pilot the tablets with about 200 reps over the next few months before rolling out the devices, from multiple OEMs, next year. <P> Gupta is also trying to get his arms around Cipla's sprawling supply chain of distributors and resellers to improve on-time delivery, which he estimates was in the low teens when he took the job. Cipla's starting with process improvements, adopting <a href="http://www.pinnacle-strategies.com/articles/ToCResults.pdf">theory of constraints</a> methodologies before turning to technology. <P> Next up is a big bang SAP ERP implementation -- starting with financial accounting, sales and distribution, production planning and materials management, and purchase and order management -- to replace 40-plus custom systems. "Every process will change," Gupta says. "There will be disruption from day one." The rollout is due to start in January and finish by 2015. <P> Meantime, Gupta is building up Cipla's in-house IT capabilities. A goal over the next 12 months is to add 35 IT specialists beyond those 17 in the core IT group. For example, a SAP lead will join the company next month and hire his own team; same for a chief information security officer Gupta is recruiting. In the process, Cipla will gradually wean itself off its dependence on IT vendors, integrators and consultants -- much like CIO Randy Mott is doing at <a href="http://www.informationweek.com/global-cio/interviews/general-motors-will-slash-outsourcing-in/240002892">General Motors</a> under his own recently launched IT "transformation" effort, though that's on a much larger scale. <P> Gupta, like Mott, realizes he doesn't have the luxury of making incremental changes. He figures Cipla is 10 to 15 years behind others when it comes to IT best practices, and all Cipla executives are under pressure to accelerate company growth to the 30% to 35% range. <P> In the past, Cipla was averse to doing such a massive ERP implementation, for instance, "but now there's no choice" Gupta says. "If we don't do it, it will start impacting the business."2012-10-08T08:58:00ZTechnology spending and influence are moving outside of the IT department, but let's not lay a wreath for the IT pro just yet.http://www.informationweek.com/news/240008574?cid=RSSfeed_IWK_authorsThe new conventional wisdom is that the CIO and IT organization are becoming relics, as business technology decision-making and purchasing move into marketing, sales, HR, and other departments. Who needs a big IT organization, the reasoning goes, when tech-savvy line-of-business workers and their managers can buy the server capacity, storage, applications, and devices they need with a few clicks and a credit card? <P> In a column titled <a href="http://www.informationweek.com/global-cio/interviews/new-face-of-it-line-of-business-execs/240008153">"New Face Of IT: Line Of Business Execs,"</a> <em>InformationWeek</em> contributor Patrick Houston relates the example of LivingSocial, a Groupon-like startup whose HR chief, Jennifer Trzepacz, ramped up cloud-based recruiting, payroll, and employee performance-management systems in next to no time--all without an IT department. Concludes Houston: "Trzepacz and others like her--managers who know their disciplines more intimately than IT could--are destined to command ever bigger shares of enterprise technology budgets." <P> Adding fuel to the debate are two recent reports that conclude that marketing departments, whose spending on IT already is growing two to three times faster than other IT spending, are taking matters into their own hands. Gartner predicts that by 2017, <a href="http://my.gartner.com/portal/server.pt?open=512&objID=202&mode=2&PageID=5553&resId=1871515&ref=Webin">marketing departments will spend more on IT than the IT organizations</a> at those companies. And IBM, in a survey of 1,700 CMOs, found that 23% of them now rely extensively on external partnerships for IT initiatives--but 61% think they'll rely extensively on them over the next three to five years. <P> <strong>[ Do you underpromise and overdeliver? Read <a href="http://www.informationweek.com/global-cio/interviews/hypesters-put-it-credibility-on-the-line/240008035?itc=edit_in_body_cross">Hypesters Put IT Credibility On The Line</a>. ]</strong> <P> The findings of a recent <em>InformationWeek</em> survey of IT and non-IT pros seem to pile on. Close to three-fourths of the respondents to that survey said they consider their IT department to be an also-ran when it comes to innovation, lending credence to the notion that other departments will fill the void. <P> And it's not just a bunch of navel gazers who see a shift coming. <em>InformationWeek</em> contributor Larry Tieman, a former senior IT executive at FedEx, thinks the IT organization of the future "will be <a href="http://www.informationweek.com/global-cio/interviews/why-the-cio-position-is-in-jeopardy/240001607">a smaller, more externally focused, higher-expertise IT organization</a>, with most of the infrastructure and operational expertise outsourced. What the internal IT pros will be doing, what their expertise will be in, and what role the CIO will play (if there is one) are still undetermined." <P> But before we start laying a wreath for the IT organization and dedicated IT professional, let's step back. A few caveats: <P> -- Not every company is a startup. LivingSocial may function fine (for now) without an IT department, but companies with myriad legacy systems to manage, competitors to one-up, and regulations to comply with need in-house IT chops--in integration, security, application development, analytics, networking, and much more. "Just put it all in the cloud" works for only the smallest companies. And it's not necessarily an old world vs. new world divide. Consider the extensive in-house IT infrastructure work (servers, storage, networking, data center cooling, power) done by Google, one of the biggest cloud proponents. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> -- The challenge before IT organizations is to earn a position at the center of innovation, not just plod along in a support and maintenance role--a role that 39% of the IT pros and 54% of the non-IT pros in our survey see as their IT organization's main focus. IT is uniquely positioned to lead that innovation charge, as it's already intertwined (or should be) with every other company department. But CIOs must establish formal partnerships with other department chiefs, not just get on a conference call with them from time to time. <P> For example, Allstate runs crowdsourced "innovation blitzes" out of its IT organization, whose executive VP, Suren Gupta, also sits on an innovation council that includes top execs from the insurer's product, claims, financial, operations, investments, and sales departments. USAA, under its Agile Labs, puts developers together with subject matter experts and customer service reps to create fast prototypes of new products and product enhancements. USAA estimates that the initiative lets it go to market 40% faster than before. <a href="http://www.informationweek.com/global-cio/interviews/beth-israel-deaconess-medical-center-emb/240006766">Beth Israel Deaconess Medical Center, the No. 1 company in the 2012 <em>InformationWeek 500</em> ranking</a>, pulls IT and business leaders together under fast-track committees that develop business priorities and match IT resources. "These leaders are working to formalize tech innovation as part of everyday business, because the reality is that business units aren't always going to ask for IT's help anymore," <a href="http://www.informationweek.com/global-cio/interviews/why-business-doesnt-look-to-it-for-innov/240008408">writes my colleague Eric Lundquist</a>. <P> -- Meantime, CIOs need to take on roles outside of the IT organization. Among our <em>InformationWeek 500</em> companies, 34% of CIOs are responsible for innovation, 33% for business process management and improvement, 13% for operations, 13% for procurement, 12% for business services, 5% for logistics and supply chain, and 30% for some other function. Only 15% of those <em>IW 500</em> CIOs have no official responsibility outside of IT. <P> In the end, though, technical expertise is still critical. Asked to respond to the question "What's the fastest way into my doghouse," Richard Thomas, CIO of biopharmaceutical services company Quintiles, which ranked No. 6 on the 2012 <em>IW 500</em>, said: "Working in IT but not understanding technology. If you work in IT, I expect you to know what you're talking about."2012-10-03T08:00:00ZBusiness technology leaders and managers need to get into the habit of underpromising and overdelivering.http://www.informationweek.com/news/240008035?cid=RSSfeed_IWK_authors No one's more bullish than <i>InformationWeek</i> on the opportunities in front of CIOs and their companies for breakthrough IT innovation. Our recent <a href="http://www.informationweek.com/1343/" target="_blank"><i>InformationWeek 500</i></a> ranking and profiles chronicled and celebrated some extraordinary best practices across U.S. industries.</p> <P> But every IT project isn't a home run; every IT investment doesn't pay for itself 10 times over in a matter of months. Meantime, setbacks and screwups are inevitable. </p> <P> <a href="http://www.informationweek.com/global-cio/interviews/8-it-mistakes-must-have-lessons-from-top/240007998" target="_blank">As my colleague Chris Murphy lays out in his "Mistakes" feature</a>: "The best companies stare their IT mistakes straight in the eye. They don't tiptoe around them. They don't rename them 'teaching moments' or 'issues.' They don't play blame games. They lay their mistakes bare so that their teams can improve."</p> <P> They also don't promise the moon. Think about the ERP and Y2K boondoggles of the 1990s, and more recently all of the hype around Big Data and the Social Enterprise. Those IT-centric efforts had and have the potential to deliver meaningful, even extraordinary business value, but some temperance is in order. Rather than trumpet out-of-the-box "business transformation," forecast incredible cost savings, or insist that the sky will fall without this or that investment, business technology leaders and managers need to go back to underpromising and overdelivering. </p> <P> They'll have that much more cred the next time they're advocating a big overhaul or investment.</p> <P> <strong>Hype On A Grand Scale</strong></p> <P> A case study in IT hype on a grand scale is the healthcare industry's promise of hundreds of billions of dollars in savings and improved care with the move to electronic health records. <a href="http://online.wsj.com/article/SB10000872396390443847404577627041964831020.html" target="_blank">In a recent column in The Wall Street Journal</a>, two respected researchers--one from Harvard University and the other from the University of Pennsylvania--argue that health IT has in fact done little to reduce the cost of care and improve quality. </p> <P> "As applied researchers and evaluators, we actively work to realize both goals," the authors say. "But this will require an accurate appraisal of the technology's successes and failures, not a mixture of cheerleading and financial pressure by government agencies based on unsubstantiated promises."</p> <P> It's not that healthcare IT is somehow unimportant; it's an absolutely essential part of doing business and providing care in a modern, electronic world. Bold healthcare IT advances--such as the Clinical Query informatics <a href="http://www.informationweek.com/global-cio/interviews/beth-israel-deaconess-medical-center-emb/240006766" target="_blank">platform developed by Harvard's Beth Israel Deaconess Medical Center</a> (the No. 1 company in this year's <i>InformationWeek 500</i>) to do population-based data analyses--show the extraordinary potential of IT to improve treatment and even prevent diseases. </p> <P> But to suggest that digitizing records and processes will improve care and save hospitals and other medical practitioners (and their patients) hundreds of billions of dollars overnight --as the industry promised while lobbying the government to provide financial incentives to EHR buyers--was wishful at best and deceptive at worst. </p> <P> Such unfulfilled promises, like the ones with ERP and Y2K in a different era and the ones with Big Data and the Social Enterprise today, are a blot on the reputation of business technology in general.</p> <P> A recent American Airlines announcement shows the problem on a much smaller scale. In touting the fact that its pilots will use iPads to store onboard reference materials and other documentation rather than tote 35-pound bags of paper on every flight, American estimated that the lighter tablets will save the company $1.2 million a year on fuel. Really, by eliminating a sack of paper per flight? Even if such a marginal move could yield that kind of annual savings, American is flying into a stiff headwind when it comes to lightening its flight cargo: Passenger obesity trends alone will more than offset any fuel savings from the lighter tablets. And did American factor the cost of the iPads into its $1.2 million savings estimate?</p> <P> OK, we're all in the PR business in one way or another. But be careful how far you and your colleagues stretch the truth. Credibility is a very fragile thing. </P> <P> <center><a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/infoweek/1343/1343_500_return_to_homepage.gif" width="299" height="45" hspace="0" vspace="0" alt="Go to the 2012 InformationWeek 500 homepage" title="Go to the 2012 InformationWeek 500 homepage" border="0"/></a></center></p> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/19/9060/Network-Infrastructure/informationweek-october-8-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1345/smallcov.jpg" alt="InformationWeek: Oct. 8, 2012 Issue" title="InformationWeek: Oct. 8, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/19/9060/Network-Infrastructure/informationweek-october-8-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE -->2012-09-21T02:05:00Zhttp://reports.informationweek.com/abstract/83/8870/IT-Business-Strategy/research-innovation-mandate-take-ii.html?cid=RSSfeed_IWK_authors2012-09-12T00:01:00ZElectronics manufacturer's quality management software not only flags problems, but cuts costs, fosters collaboration, and improves time to market.http://www.informationweek.com/news/240006817?cid=RSSfeed_IWK_authorsIn the low-margin business of contract manufacturing, the ability to improve product quality while cutting costs is critical. Enter FlexQ, quality management software developed by Flextronics that not only flags product and process anomalies and reduces costly recalls, but also helps the contract manufacturer foster collaboration across interdisciplinary teams, improve customers' time to market, ensure regulatory compliance, and gather information for audits.</p> <P> Flextronics does contract manufacturing in two broad areas: for customers such as Apple, Lenovo, and Microsoft, where the ability to ramp up quickly and produce at scale and low cost is key; and for customers such as Ford, Alcatel, and Huawei, where build-to-order and the ability to make design changes on the fly come more into play. Flextronics partners with customers beginning to end: product design, procurement of parts, manufacturing, shipment to retailers and other channels, warehousing, even warranty work.</p> <P> Its FlexQ software is an outgrowth of FlexFlow, the company's custom-developed ordering and forecasting system, which is "the secret sauce in our industry," says Flextronics CIO Dave Smoley. FlexQ started as the quality module on that system, but FlexFlow is deployed locally, at the factory level, and Flextronics determined that it's critical to share quality information across all of its sites globally, as well as with customers and suppliers.</p> <P> So Flextronics developed FlexQ as a separate, Web-based application that everyone in the supply chain can access. FlexQ executes several quality processes and includes workflows for preventive action, customer complaints, corrective action, and auditing. FlexQ's Device History Record management capabilities are mandated by industries such as medical and automotive to ensure regulatory compliance.</p> <P> Previously, Flextronics managed manufacturing quality site by site, using a hodgepodge of spreadsheets, emails, and other tools. It was difficult to share information and analyze it in a coordinated way, Smoley says. Quality engineers now can access the data from their smartphones and iPads, for example, whereas before the data was available only on local PCs.</p> <P> <!-- Image Aligning Right --> <div class="inlineStoryImage inlineStoryImageRight"> <img src="http://twimgs.com/informationweek/1343/343IW500_BI_flextronics_175.jpg" alt="CIO Smoley (right, with general manager Zahid Hussain) takes a hands-on approach to quality control" title="CIO Smoley (right, with general manager Zahid Hussain) takes a hands-on approach to quality control" class="img175"> <div class="storyImageCaption">CIO Smoley (right, with general manager Zahid Hussain) takes a hands-on approach to quality control</div> </div> <!-- / Image Aligning Right --> <P> With its quality assurance and compliance benefits, FlexQ also provides some peace of mind for highly regulated, safety-conscious customers that might otherwise be leery of outsourcing their manufacturing, Smoley says. For example, FlexQ was instrumental in Flextronics' landing Insulet as a customer for the contract manufacture of insulin pumps, he says. The software's workflow and document management features chronicle each step of the manufacturing process and dictate preventive and corrective actions where necessary. That's not just a health and safety issue for Insulet--it's also a financial one, to avoid stiff fines for noncompliance with FDA regulations.</p> <P> In 2007, Flextronics had six customer product recalls that cost the company more than $6 million, says Manny Nyakako, VP of global quality. Last year, thanks to FlexQ, it had only one customer product recall, costing the company less than $500,000.</p> <P> All in all, there are more than 6,000 users on the system, compared with a few hundred users on the multiple silo systems used previously. And now Flextronics has only one quality system (built on Microsoft .NET and SQL Server) to support and update (about four times a year). FlexQ is run internally, but Smoley says his team will eventually move the Web app into Microsoft's Azure cloud.</p> <P> <center><a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/infoweek/1343/1343_500_return_to_homepage.gif" width="299" height="45" hspace="0" vspace="0" alt="Go to the 2012 InformationWeek 500 homepage" title="Go to the 2012 InformationWeek 500 homepage" border="0"/></a></center></p>2012-09-10T08:30:00ZAs the <em>IW 500</em> Conference kicks off this week, IT leaders rank BYOD and cloud among their biggest challenges. But the smartest CIOs look beyond the negatives.http://www.informationweek.com/news/240006882?cid=RSSfeed_IWK_authorsThere are two types of business technology organizations: those whose main mission is to create and pursue opportunities, and those preoccupied with putting out fires and solving problems. Opportunities are the stuff of growth and success: more revenue, fatter profits, happier customers. Problem solving is more about upkeep and survival: system maintenance, software patches, security plugs. <P> All are critical responsibilities, of course, so it's a question of emphasis. What do you want your business technology organization to be known for: its five 9s of availability and spot-on remediation, or its bold innovations and ability to create shareholder value? Channeling Peter Drucker, <a href="http://online.wsj.com/article/SB10000872396390444914904577621083163383966.html">a <em>Wall Street Journal</em> column</a> recently observed: "When you solve problems, you end up feeding your failures, starving your strengths, and achieving costly mediocrity." Do you see any of your organization in that statement? <P> Prior to our <a href="http://www.informationweek.com/1343"><em>InformationWeek 500</em> Conference,</a> I sent a note to registered attendees, many of them CIOs and all of them IT leaders, asking them to list their top three or four challenges. Their responses were a mix of problems and opportunities. At the risk of sounding like a management consultant, I think many of their problems <em>are</em> opportunities--if CIOs and their lieutenants come at them in a different way. <P> Consider some of the examples from our conference attendees: <P> <strong>BYOD/Mobility:</strong> <P> <em>Problem:</em> How do I get our iPhone-toting employees and my iPad-loving boss off my back? How do I make sure that they're not exposing sensitive company data and communications? <P> <em>Opportunity:</em> How can we make employees more productive--and perhaps cut costs in the process--by letting them use the tools they're most comfortable with? How do we embrace mobile applications to wow customers and make more money for our company? <P> <strong>Cloud Services:</strong> <P> <em>Problem:</em> How do we stop other departments from buying and implementing software, storage, compute, and other cloud services without the IT organization's expert input and assistance? <P> <em>Opportunity:</em> Where in our company might cloud services trump conventional software or systems, for reasons of functionality, cost, usability, ease of upgrades, and/or speed to market? How do we partner with other business departments to evaluate cloud services? <P> <strong>Social Media:</strong> <P> <em>Problem:</em> How do I keep our employees from running amok on Twitter, Facebook, and other public and private sites? How do we react to and manage negative comments about our company? <P> <em>Opportunity:</em> How can our company listen in on social media conversations to better serve customers and attract potential customers? <P> <strong>Big Data:</strong> <P> <em>Problem:</em> How do we tame (or slow) the growth and duplication of data at our company? <P> <em>Opportunity:</em> How do we turn our mountains of data into actionable insight, in order to make more-informed decisions in real time as well as anticipate customer and partner needs? <P> <strong>Security:</strong> <P> <em>Problem:</em> How do we lock down our systems to lower the risk of attack and data leakage? <P> <em>Opportunity:</em> How do we protect our most important information assets without making it difficult for employees to do their jobs and for customers to do business with us? How do we build an internal culture of information security awareness? How do we build a reputation for handling customer data with the utmost care and sensitivity? <P> <strong>Innovation:</strong> <P> <em>Problem:</em> How do we squeeze our IT operations budget and carve out the time to do more innovative work with fewer resources? <P> <em>Opportunity:</em> How do we align the hearts and minds of our IT pros with the mission of our business and the needs and aspirations of our customers? How do we go on the offensive--in the words of <a href="http://www.informationweek.com/global-cio/interviews/iw-500-data-shows-how-it-rules-have-chan/240006825">our magazine cover story,</a> become innovators and rule breakers--rather than react and defend? <P> <center><a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/infoweek/1343/1343_500_return_to_homepage.gif" width="299" height="45" hspace="0" vspace="0" alt="Go to the 2012 InformationWeek 500 homepage" title="Go to the 2012 InformationWeek 500 homepage" border="0"/></a></center></p>2012-08-08T08:00:00ZUnion Pacific is spending hundreds of millions on IT each year for the federal plan aimed at making train accidents less likely. http://www.informationweek.com/news/240004933?cid=RSSfeed_IWK_authorsImagine having a $300 million annual IT budget, about 1.5% of company revenue, and then being told by Congress that you need to spend an additional $350 million to $400 million a year on an IT project that will yield minimal business benefits and for which there are minimal federal subsidies.</p> <P> That's the situation Union Pacific finds itself in with its version of Positive Train Control, a set of interoperable systems under development industry-wide aimed at preventing train-to-train collisions, over-speed derailments, and injuries to rail-side workers. PTC systems are designed to keep a train within authorized limits on a track. When necessary, the technology will override the engineer or operator to slow down or stop a train. "It self-enforces safety," says Michael Newcomb, the IT director who oversees UP's work on PTC.</p> <P> A train crash in California in 2008 in which 25 people died led to the Rail Safety Improvement Act, which mandates that all major U.S. railroads implement a PTC system by Dec. 31, 2015. Currently, 11 PTC projects, involving nine railroads in at least 16 states, are in varying stages of development and implementation, according to the Federal Railroad Administration, which estimates that the systems will cover about 70,000 miles of track when the program is completed. A consortium led by UP, CSX Transportation, Norfolk Southern Railway, and BNSF Railway is leading the interoperability effort.</p> <P> PTC is a huge undertaking, one that UP CIO Lynden Tennison equates to a massive "science project" requiring each railroad company to overhaul its communications, back-office, "wayside" switching and signaling, and on-board train infrastructures. Newcomb says the system will have to pass 10,000 test cases before it can go fully operational at UP. Already, there's widespread talk in the industry of the need to extend the deadline beyond 2015.</p> <P> Tennison estimates that when all is said and done, the industry will have spent about $20 billion and UP itself more than $2 billion on PTC. Originally, it was thought that the program would let the railroad companies eliminate one of the two engineers on board each of their trains, yielding substantial cost savings over time, but union pressures scuttled those plans, Tennison says. So UP is looking for other ways to monetize its PTC work.</p> <P> For example, that work is giving UP crews improved real-time feedback if they're violating train handling rules, it's helping with remote management of track wayside equipment, and it's improving communications security for national critical infrastructure. </p> <P> A more tangible outcome of UP's PTC work is a system that alerts on-board engineers to optimal throttling and braking procedures given track, traffic, and other conditions, helping the company cut fuel costs by 4% to 6%. Deeper savings are possible, as UP studies show that its best engineers use two-thirds the fuel of its worst engineers. (UP now publishes the fuel metrics of its train engineers, rewarding the top tier with $75 gas cards while having serious chats with the underperformers.)</p> <P> The fuel savings are noteworthy, Tennison says, "but you don't need $100,000 worth of hardware on the locomotive to do that. We could've done it for a much, much lower price." </p> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/81/8997/Business-Intelligence-and-Information-Management/informationweek-august-13-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1340/cov_110w.jpg" alt="InformationWeek: August 13, 2012 Issue" title="InformationWeek: August 13, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/81/8997/Business-Intelligence-and-Information-Management/informationweek-august-13-2012.html?k=axxe&cid=article_axxe_o">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE -->2012-08-08T08:00:00ZUnion Pacific has to put a lot of energy into internships and recruiting to lure its IT talent.http://www.informationweek.com/news/240004931?cid=RSSfeed_IWK_authorsWhen Union Pacific IT recruiters attend job fairs on college campuses nationwide, they typically look on enviously as long lines queue at the booths of Google, Microsoft, Oracle, and other tony tech employers. Union Pacific CIO Lynden Tennison realizes he has a big challenge on his hands to convince students that a 150-year-old railroad freight hauler based in Omaha, Neb., is an attractive alternative. But he has a plan.</p> <P> Tennison figures that if he can get students to spend a few months interning at UP headquarters, he can hook them. The company's IT organization recruits at the likes of Purdue, Michigan State, Georgia Tech, Texas, even MIT, as well as locally at Nebraska and Iowa State. Only 10% of the college students it makes job offers to accept, he says, but that rate jumps to 70% to 75% among students who have interned at headquarters.</p> <P> The IT organization's 40 summer interns and 70 year-round interns are paid between $15 and $24 an hour; those from outside the Omaha area get housing, a meal plan, transportation, and relocation assistance. It also has seven high school interns doing system and training documentation, performing data validation, and creating scripts to migrate data during system upgrades. "We try to push on all sides as much as we can to grow the pool," Tennison says. </p> <P> What does UP have to offer more seasoned IT pros? Tennison runs through a few attributes:</p> <P> &gt;&gt; UP is doing leading-edge work--in real-time and predictive analytics, hardware engineering, sensor-based mote technology, train communications, and other areas. It develops and builds much of its own IT (see <a href="http://www.informationweek.com/news/global-cio/interviews/240004932">Why Union Pacific Builds Its Own Tech</a>). </p> <P> To promote a culture of IT innovation, Tennison three years ago initiated a website where anyone in the IT organization can post and comment on an IT-related idea anonymously. If 80% of voters give the idea a thumbs up, the person who proposed it gets $3,000 and up to 80 hours of work time to whip it into a prototype. If the idea is then deemed worthy of additional investment or deeper analysis, a formal plan is drawn up. Tennison estimates that UP has realized $10 million in benefits from the program, mostly from one idea on how to minimize false positives generated by rail wayside tracking systems, which were needlessly stopping trains. </p> <P> &gt;&gt; Omaha, where most of the company's IT employees work, isn't the most hopping place for a college grad, but it has a lot to offer. It ranked eighth on the 2011 Best Cities for Families list of Parenting magazine, which gave the city of 400,000 people (more than 800,000 in the metro area) props for its strong schools, "thriving job market," and "vibrant jazz presence." Along with short commutes, it has a small downtown area, supports a performing arts center, is home to three minor league sports teams, hosts the College World Series every June, and attracts a number of name entertainment acts.</p> <P> &gt;&gt; There's employment stability at UP. Average length of service is 12 years. Attrition rates run in the 5% to 6% range, with a significant portion from retirements.</p> <P> In all, the UP IT organization consists of about 2,000 people, 600 of them contractors (450 offshore, mostly in India, and 150 onshore). Of its 1,400 or so full-time employees, 400 are in telecom; 200 are in what Tennison calls "system engineering" (database management, middleware, operating systems, system programming, data warehousing); 180 to 200 are in data center operations; and most of the rest are in application development. Then there are the 50 or so computer, electrical, and mechanical engineers in the company's hardware R&amp;D lab, who design and build everything from locomotive radios to railcar monitoring systems (see <a href="http://www.informationweek.com/news/global-cio/interviews/240004933">Congress' $20 Billion Tech Mandate: Make Trains Safer</a>).</p> <P> Tennison says he has never laid off an IT employee in seven years as CIO, even as he moved work offshore. His organization hired 137 people in 2011 and 70 people so far this year. It has 10 open positions, for systems architects, developers (Java, C++), and operations support (help desk, LAN, network ops). </p> <P> To get access to programmers, Tennison had been bringing workers on H-1B visas to Omaha, but he found that going offshore for such work was cheaper and easier. He thinks UP's current mix of onshore/offshore IT pros is just about right, acknowledging that "you lose efficiency" with offshore contractors. "It's worked pretty effectively," he says. "I will not say it's worked without pain." </p> <P> <!-- KINDLE EXCLUDE --> <!-- RECOMMENDED READING --> <a name="recommended"></a> <center> <div id="recommendedReadingPromo"> <div class="recommendedReadingPromoHeader"><strong>More In This Series:</strong></div> <ul class="normalUL"> <li><a href="http://www.informationweek.com/news/global-cio/interviews/240004930">Union Pacific Delivers Internet Of Things Reality Check</a></li> <li><a href="http://www.informationweek.com/news/global-cio/interviews/240004932">Why Union Pacific Builds Its Own Tech</a></li> <li class="last-li"><a href="http://www.informationweek.com/news/global-cio/interviews/240004933">Congress' $20 Billion Tech Mandate: Make Trains Safer</a></li> </ul> </div> </center><br clear="all"> <!-- / RECOMMENDED READING --> <!-- /KINDLE EXCLUDE --> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/81/8997/Business-Intelligence-and-Information-Management/informationweek-august-13-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1340/cov_110w.jpg" alt="InformationWeek: August 13, 2012 Issue" title="InformationWeek: August 13, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/81/8997/Business-Intelligence-and-Information-Management/informationweek-august-13-2012.html?k=axxe&cid=article_axxe_o">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE -->2012-08-08T08:00:00ZThe railroad often finds off-the-shelf software and hardware is too expensive and isn't tuned to its needs.http://www.informationweek.com/news/240004932?cid=RSSfeed_IWK_authorsIn an era when most IT organizations look to buy off-the-shelf software, avoid doing custom coding, and allow the use of more mass-market consumer technology than they ever thought possible, Union Pacific CIO Lynden Tennison is an unapologetic believer in building rather than always buying the hardware, software, and systems that underpin its $20 billion railroad shipping business. And while it's at it, UP generates $35 million to $40 million in revenue a year selling or licensing some of those technology innovations to other companies, including rivals, creating a small profit center within its $300 million-a-year IT cost center. </p> <P> UP, the nation's largest railroad company, operating west of Chicago and New Orleans, develops and builds much of its own IT partly out of necessity. The railroad shipping industry's specialized and often complex technology needs don't add up to a lucrative enough market to attract the major tech vendors. And the boutique vendors that try to fill those specialized needs are often one bad quarter away from bankruptcy, Tennison says, or they charge exorbitant prices because they're not producing at large scale and lack adequate competition. So UP is always looking for in-house IT alternatives. </p> <P> While Tennison jokes that UP isn't likely to get into the general ledger software business anytime soon, it did develop its own supply chain applications, as the likes of SAP and Oracle couldn't meet its stringent performance requirements (it will tolerate only 1.5 hours of downtime a month for system upgrades and changes). UP even develops its own firewalls; develops its own service-oriented architecture; builds its own locomotive radios, networking consoles, and antenna farms; owns its own radio spectrum and trackside optical fiber (34,000 miles of it); and builds its own microwave towers (700 of them). </p> <P> More ambitiously, UP acquired a small Michigan-based gaming outfit several years ago to develop virtual reality programs--complete with avatars and precise 3-D renderings of actual rail yards and trains--for internal training of RCOs (remote control operators), conductors, car inspectors, and other personnel. The company is now looking to sell that software to other railroad companies, as well as to construction, mining, and energy companies, under its PS Technology unit. </p> <P> The mother of all UP IT projects is NetControl, a Linux-based transportation management system to replace the mainframe-based system the company rolled out in the late 1960s. About 270 people worldwide are working on NetControl, which Tennison calls "our family jewels." The $200 million system, which is rolled out in increments, is about halfway done and due to be fully operational in 2017.</p> <P> UP's current transportation management system is used mostly for taking customer orders, scheduling train operations, tracking what's going on in train cars, and monitoring railroad traffic. It's being updated to a Web platform, letting customers access it from mobile devices, place more accurate orders, and see the planned travel itinerary for their shipments. With NetControl, UC will be able to monitor terminal and network use over time and forecast imbalances in the supply and demand of crews or locomotive power. Automated action- or alert-driven workflows can recommend optimal solutions.</p> <P> One internal benefit of moving to NetControl is that more technical expertise is available to support a Web versus a mainframe system, Tennison says. UP is also looking to sell NetControl to other railroad companies.</p> <P> Tennison, the company's CIO since 2005, made his vendor bones running a for-profit UP service management application subsidiary called Nexterna from 1998 through 2001. Still, he says he sometimes wonders "whether we're dinosaurs" doing all of this custom work. "I second-guess myself a lot," he concedes, "but it doesn't feel like we're making bad decisions." </p> <P> <!-- KINDLE EXCLUDE --> <!-- RECOMMENDED READING --> <a name="recommended"></a> <center> <div id="recommendedReadingPromo"> <div class="recommendedReadingPromoHeader"><strong>More In This Series:</strong></div> <ul class="normalUL"> <li><a href="http://www.informationweek.com/news/global-cio/interviews/240004930">Union Pacific Delivers Internet Of Things Reality Check</a></li> <li><a href="http://www.informationweek.com/news/global-cio/interviews/240004931">Tech Hotshot, Want To Work At A Railroad?</a></li> <li class="last-li"><a href="http://www.informationweek.com/news/global-cio/interviews/240004933">Congress' $20 Billion Tech Mandate: Make Trains Safer</a></li> </ul> </div> </center><br clear="all"> <!-- / RECOMMENDED READING --> <!-- /KINDLE EXCLUDE --> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/81/8997/Business-Intelligence-and-Information-Management/informationweek-august-13-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1340/cov_110w.jpg" alt="InformationWeek: August 13, 2012 Issue" title="InformationWeek: August 13, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/81/8997/Business-Intelligence-and-Information-Management/informationweek-august-13-2012.html?k=axxe&cid=article_axxe_o">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE -->2012-08-03T08:30:00ZOutsourcing remains pervasive in both the public and private sectors, and it's not going away, despite the widespread backlash.http://www.informationweek.com/news/240004847?cid=RSSfeed_IWK_authorsOutsourcing is the polarizing IT management issue of our time. Few if any IT practices are so widely embraced at the highest corporate levels, yet so widely derided by the rank and file, especially when the work that's outsourced is moved offshore. <P> On the message boards, outsourcing is blamed for everything from Dreamliner delays at Boeing to the second-quarter loss at Microsoft (despite the fact that a one-time, $6.2 billion financial write-down was the real cause). Outsourcing providers and customers are portrayed as miscreants and dolts. <P> One critic, commenting on an <em>InformationWeek</em> column Allstate CIO Jim Ditmore wrote about his <a href="http://www.informationweek.com/news/global-cio/interviews/240003659">negative experiences with outsourcing</a> earlier in his career, surmised: "Would it be correct for me to guess that a non-technical CIO and other ignorant CXOs made the decision to outsource? Were the screams of protest by knowledgeable 'IT people' (a.k.a. the drones) ignored because they were supposedly interested only in saving their own jobs? Can the sales process for the outsourcing deal be described as 'people who don't know what they're selling telling lies to people who don't know what they're buying?'" <P> Outsourcing's also a political livewire. Even though the federal government outsources much of its work, IT and otherwise, to all manner of contractors, consultants, integrators, and other vendors--and some of that work makes its way offshore--the Obama administration talks about outsourcing as if it were worthy of an Un-American Activities investigation. The Romney campaign can't backpedal fast enough from any suggestion that the former executive engaged in the practice when he was governor of Massachusetts and CEO of Bain. Likewise, many executives still keep their companies' large outsourcing contracts close to the vest, for fear of a public relations backlash. I've talked with plenty of CIOs who rave in private about their offshore vendors--but take the Fifth in public. <P> <strong>[ Learn why <a href="http://www.informationweek.com/news/global-cio/outsourcing/240002894?itc=edit_in_body_cross">Obama's Attack On Outsourcing Rings Hypocritical</a>. ]</strong> <P> The fact of the matter is, outsourcing remains pervasive in both the public and private sectors, and it's not going away, despite the social and political blowback. For example, 82% of the 564 business technology professionals who responded to our recent 2012 State Of IT Outsourcing survey said their companies use such services, up slightly from 81% a year ago. Among those that outsource, more than half (59%) use offshore providers to some degree. And 31% said the composition of their IT workforces will shift more toward outsourcers in the next year, while only 15% said it will shift away (54% said the mix will remain about the same). My colleague Paul McDougall will dive deeper into those survey results, including the perspectives of customers, suppliers, and other industry players, in an upcoming <em>InformationWeek</em> feature story. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> There are exceptions to the trend, of course. New General Motors CIO Randy Mott made national headlines last month after <em>InformationWeek</em> reported that he plans to <a href="http://www.informationweek.com/news/global-cio/interviews/240002892">reverse the automaker's historical reliance on IT outsourcing</a>--from a mix of 90% outsourced and 10% in-house staff to 10% outsourced and 90% in-house&#8212;in an attempt to execute projects faster and cultivate auto technology expertise internally. GM's plan to hire thousands of people for four new software development centers in the United States, rather than locate one or two of them abroad (like in China, its fastest-growing market), probably is based in some measure on the fact that the company owes its existence to the $50 billion bailout funded by American taxpayers. <P> Allstate's Ditmore warns CIOs about handing off their critical intellectual property, much of it IT-related, to outsourcers. And don't count on IT outsourcers to cut costs, he said. "While most small and midsized companies don't have the scale to achieve cost parity with a large outsourcer," Ditmore says, "nearly all large companies and many midsized ones do have that scale." He argues for doing only small outsourcing deals, for which it's easier to establish SLAs and measure performance. <P> If so many leaders are so leery of outsourcing, why do so many organizations continue to do it? Because when these contracts and relationships are properly thought out, vetted, and managed, they can deliver strong results--especially when they're tied to strategic business outcomes and not just brute cost savings. Outsourcers can bring hard-to-find expertise and fresh ways of thinking to some of the most pressing business technology challenges. <P> Outsourcing isn't a panacea for dysfunctional IT operations and management. But it's not the devil some of its detractors make it out to be.2012-07-09T08:00:00ZThe CIO's road through Wal-Mart, Dell, and HP was marked by very different cultures and expectations.http://www.informationweek.com/news/240002893?cid=RSSfeed_IWK_authors<img src="http://twimgs.com/informationweek/1338/338cover_3_110.jpg" width="110" height="110" align="right" hspace="5">Randy Mott doesn't think small. As CIO of four of the largest U.S. companies during his career of more than 30 years, he has tended to go "all in" on IT measures, whether they're data center consolidations or workforce overhauls.</p> <P> But three of those market-leading companies--Wal-Mart, Hewlett-Packard, and now General Motors--couldn't be more different. At least Mott caught them at very different stages in their evolution.</p> <P> Mott's 22 years at Wal-Mart, where he was CIO from 1994 to 2000, were marked by tremendous growth, as it shot past $100 billion in revenue to become one of the largest corporations on the planet. During those years, as it emerged from the larger-than-life shadow of founder Sam Walton, Wal-Mart was a pioneer in analyzing big data (before the term existed) to optimize its global supply chain and ultimately deliver all manner of products to customers at "everyday low prices."</p> <P> They were Wal-Mart's glory years, before the lawyers and interest groups and politicians started sinking their teeth into the country's largest employer, and before Target, Costco, Amazon, and other rivals cut in with their own supply chain and business model innovations. It was at Wal-Mart that Mott learned the virtues of delivering IT projects quickly ("speed merchant," InformationWeek called him in a 1996 magazine cover story), and always on a tight budget. It was also where Mott learned to measure everything and to act like a "retailer first, technologist second," a primal business focus he retains to this day.</p> <P> Mott's HP years, from 2005 to 2011 (following five years at rival Dell), were marked by massive cost cutting and consolidation, as CEO Mark Hurd tapped him to reduce the company's IT spending from 4% of revenue to 2%. Under the Mott-led IT "transformation" at HP (which he took on the road to show off the HP dog food the IT organization was eating), the company modernized and consolidated data centers and applications, moved toward a single enterprise data warehouse, shifted work from IT outsourcers and other contractors to employees, and directed those employees to spend more of their time on new development and less on support and maintenance. Financially rigorous cost-benefit analyses of every IT project, big and small, were the mandate.</p> <P> Those all-in moves weren't always popular with the rank and file. Unlike Wal-Mart during the Mott years, HP was already a mature company with an HP-Way-or-the-highway culture. It had become the largest IT vendor in the world, largely through acquisitions, but its biggest products and fattest profit margins were under siege. After the HP board ousted Hurd in 2010 for what amounted to technicalities and bad judgment, Mott didn't last much longer under Hurd's replacement, L&eacuteo Apotheker, who months later was replaced by Meg Whitman.</p> <P> HP's day of reckoning is still to come. Even after the company said in May that it will cut 27,000 jobs--8% of its workforce--over the next couple of years amid slumping profits, there's still a sense that things will get worse at HP before they get better.</p> <P> Out of the frying pan, into the pressure cooker, Mott began his career at GM 20 weeks ago. A historic bankruptcy filing, controversial government bailout, and several years of austerity measures should have knocked most of the arrogance and complacency out of the company's 200,000 employees.</p> <P> In many respects, GM's a better venue than HP was for Mott to apply his IT transformation/consolidation/measurement playbook. Unlike HP, GM isn't looking to slash IT costs in the process, and by reversing the company's overwhelming reliance on outsourcers, Mott will need to hire thousands of people as it brings software development and other skills in-house.</p> <P> The way Mott sees it, he's joining a "$150 billion startup," fresh from an IPO (the U.S. Treasury Department still owns 26% of GM) and an executive management overhaul (GM is on its third CEO in 2-1/2 years). Asked why he'd join a company in GM's straits, in an industry where he has no experience, Mott said there are only a handful of multinational companies out there "with an appetite to really change," and he's getting a charge out of learning the IT challenges that come with global auto platforms, just-in-time delivery, and CAFE standards. </p> <P> Mott knows those challenges are daunting: "You come in and you have a choice to make that says: Does that company deserve the best IT it can get? And with that come hard choices. And they aren't hard choices I necessarily like to make any more than the next human being." </p> <P> <center>Go to the main story:<br> <b><a href="http://www.informationweek.com/news/global-cio/interviews/240002892">General Motors Will Slash Outsourcing In IT Overhaul</a></b></center></p> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/83/8883/IT-Business-Strategy/informationweek-july-9-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1338/cov_110w.jpg" alt="InformationWeek: July 9, 2012 Issue" title="InformationWeek: July 9, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/83/8883/IT-Business-Strategy/informationweek-july-9-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE --> <P>2012-07-09T08:00:00ZBut worries continue about offshoring of tech jobs and innovation, state of STEM education.http://www.informationweek.com/news/240002852?cid=RSSfeed_IWK_authorsTwo years ago, under the moniker <a href="http://www.informationweek.com/news/specialreport/innovation-mandate" target="_blank">Innovation Mandate</a>, <i>InformationWeek</i> fielded a survey and conducted scores of interviews to gauge whether U.S. IT pros and the industry at large think this country is declining as a global technology leader--and if so, what we can do about it. When asked to describe where the U.S. stands in the global IT industry, 63% of the 624 business technology pros who responded to that 2010 survey characterized the U.S. as "a strong player, but losing its lead on a global scale," while 5% saw the U.S. as "a former leader whose best days are behind it." Only 32% of respondents still saw the U.S. IT industry as "a global leader positioned to grow its influence."</p> <P> How have views changed in two years? We fielded an updated survey in April (download our full, updated <a href="http://reports.informationweek.com/abstract/83/8870/IT-Business-Strategy/research-innovation-mandate-take-ii.html?cid=pub_analyt__iwk_20120709" target="_blank">Innovation Mandate report</a>), and the results are in: IT pros are slightly more optimistic about the state of U.S. technology leadership, though their opinions about the most pressing priorities and competitive threats, as well as which IT vendors and nations are taking the mantle of leadership and which are falling behind, have shifted a bit in two years.</p> <P> Responding to our latest survey were 552 business technology pros at a range of U.S. companies, educational institutions, and government organizations. The same percentage as in 2010--63%--think the U.S. is a strong IT player but losing its global lead. The percentage who are more optimistic--who think it's a global leader positioned to grow its influence--rose slightly, to 34% from 32%. Only 3% of respondents think the U.S. is a former IT leader, compared with 5% two years ago.</p> <P> <strong>What, Me Worry?</strong></p> <P> As for the main factors preventing the U.S. from growing as a global IT leader, the results of the recent survey are pretty consistent with those from 2010. Still topping the list of concerns is "shortsighted decisions that are shipping tech jobs and ultimately innovation abroad," selected as one of the most important three factors by 67% of the 362 survey respondents who think the U.S. is a former technology leader or is losing its lead, compared with 66% two years ago. Likewise, the No. 2 and No. 3 factors thought to be limiting U.S. technology leadership are the same in the 2012 survey as in 2010: "failure of the educational system to produce workers who excel in STEM" and "lack of leadership at the federal policy-making level" (see chart below).</p> <P> The biggest shifts since 2010 have to do with intellectual property and perceptions about U.S. IT worker productivity and ambition. In the 2010 survey, only 18% of respondents cited "failure to protect intellectual property developed in the U.S." as one of the top three factors holding back the U.S. IT industry. But that percentage jumped to 28% this year, as more technology R&amp;D and design work gets farmed out to companies in other countries, or as news surfaces that foreign companies and governments are trying to steal that U.S. IP. Meantime, 21% of the IT pros we surveyed in 2010 worried about "a corporate culture where tech workers no longer are 'hungry' enough to out-innovate counterparts based abroad," but only 15% see that as a top concern today.</p> <P> Responses to our question about what the U.S. government's role should be in supporting IT innovation show attitudes shifting subtly away from such reliance. (Multiple responses were allowed.) About the same percentage of respondents to our 2012 and 2010 surveys think the government's role should be to support basic and applied research at the university level (59% vs. 60%) and federal level (58% in both surveys). But the percentage of respondents who want the government to provide R&amp;D tax credits to private industry declined, to 54% from 63%. Also declining is the percentage of respondents who want the government to fund big technology programs such as broadband, smart grid, and electronic medical records (38% in 2012 versus 45% in 2010). Where IT pros want more government involvement (or, more accurately, don't want less) is in regulation: 51% of respondents called for less IT regulation two years ago compared with 46% this year.</p> <P> <center><div style="font-size:.8em;"><img src="http://twimgs.com/informationweek/1338/338Rob_chart1.jpg" width="559" height="603" alt="Limits on leadership: What are the main factors preventing the U.S. from growing as a global IT leader?" hspace="0" vspace="0" border="0" style="margin-bottom:7px;" /></div></center></p> <P> <!-- KINDLE EXCLUDE --> <center> <div id="inlineReportPromo"> <div class="inlineReportPromo_headline"><a href="http://reports.informationweek.com/abstract/83/8870/IT-Business-Strategy/research-innovation-mandate-take-ii.html?cid=pub_analyt__iwk_20120709" target="_blank" style="color:#ffffff;">Innovation Mandate: Take II</a></div> <div class="inlineReportPromo_inner"> <center><strong>Slight Uptick in Optimism</strong></center><br /> <img src="http://twimgs.com/informationweek/1338/338Rob_reportcover.jpg" width="175" height="111" style="float:right;"><br /> Our <a href="http://reports.informationweek.com/abstract/83/8870/IT-Business-Strategy/research-innovation-mandate-take-ii.html?cid=pub_analyt__iwk_20120709" target="_blank">Innovation Mandate report,</a> packed with 20 charts, is free with registration.<br /><br /> <center><strong><a href="http://reports.informationweek.com/abstract/83/8870/IT-Business-Strategy/research-innovation-mandate-take-ii.html?cid=pub_analyt__iwk_20120709" target="_blank">Get This</a> And <a href="http://reports.informationweek.com/">All Our Reports</a></strong></center><br /><br /> </div> </div> </center></p><br clear="all"> <!-- /KINDLE EXCLUDE --> <P><strong>Tech Vendors Rise And Fall</strong></p> <P> When it comes to assessing the leading IT vendors, our survey shows some significant shifts between 2010 and 2012. Among those vendors on the steepest decline in the eyes of the IT pros we surveyed are Research In Motion, Hewlett-Packard, Nokia, even SAP. On the steepest ascent are Apple and Samsung.</p> <P> In our question about which U.S.-based IT companies would be insignificant or marginal players in five years, HP, on its third CEO in two years, slid the most since 2010--31% of the IT pros we surveyed now think it's on such a decline, compared with 15% two years ago. Looking at non-U.S. tech vendors through a different lens, we asked which of 15 or so companies based outside this country are either No. 1 or No. 2 in their sectors globally. Dropping the most since 2010 is RIM, considered a leader in its sector by a healthy 46% of survey respondents in 2010 but, with the rise of the iPhone and Android devices, is considered a leader in its sector by only 7% of respondents this year. Nokia was considered a sector leader by 38% of survey respondents in 2010 but by only 24% in 2012. SAP was considered a leader by 49% of respondents in 2010 but by only 35% in 2012. </p> <P> Not surprisingly, Apple is soaring in the eyes of survey respondents. When we asked two years ago which five U.S.-based tech companies are comparable to Detroit's Big Three automakers, only 41% of respondents picked Apple among them--it came in sixth on our list after Microsoft, Google, IBM, Cisco, and Intel. In this year's survey, 73% of respondents put Apple in their top five--second on the list after Microsoft. (HP, by the way, was cited among the big five by 34% of respondents in 2010 but only 18% in 2012.)</p> <P> Among non-U.S. IT vendors, Samsung's stature rose the most since 2010. Only 39% of respondents considered Samsung No. 1 or No. 2 in its sectors in 2010, but 61% designated it as a sector leader this year, as it gains market share in smartphones and provides a compelling iPad alternative in tablets.</p> <P> IT pros' attitudes about the two countries that provide the biggest IT threats to the U.S. have flip-flopped in two years. In 2010, 44% of survey respondents cited India as the biggest threat to U.S. technology leadership, but only 33% cite India this year. In contrast, 42% of respondents cited China as the biggest threat to U.S. technology leadership in 2010, but that percentage shot up to 54% this year, as China took on more and more IT R&amp;D work, some of its major IT vendors (Lenovo, Huawei) grabbed a higher international profile, and Chinese interests were accused of trying to steal IT intellectual property from U.S. and other vendors.</p> <P> <strong>What Others Are Saying</strong></p> <P> Beyond <i>InformationWeek</i>'s research on IT-based innovation, several organizations recently issued their own reports on the subject, offering mixed conclusions.</p> <P> A <a href="http://www.commerce.gov/sites/default/files/documents/2012/january/competes_010511_0.pdf" target="_blank">160-page report released by the U.S. Commerce Department</a> in January argued that the U.S. is slipping when it comes to innovation. It made the case for aggressive federal government investments in basic and applied research, STEM education, regional entrepreneurial "clusters," and other areas in order to raise the U.S. standing.</p> <P> The <a href="http://www3.weforum.org/docs/WEF_GCR_Report_2011-12.pdf" target="_blank">2011-2012 Global Competitiveness Report</a> by the World Economic Forum ranked the U.S. fifth among 142 countries, the third year in a row the U.S. ranking fell (it was fourth last year). The forum's analysis goes beyond science and technology competitiveness, factoring in broader educational, labor, legal, market, and other factors. Outranking the U.S. were Switzerland, Singapore, Sweden, and Finland. Another report from the forum released earlier this year ranks the U.S. eighth among 142 countries in what it calls network readiness: broadly, its ability to leverage its broadband infrastructure for competitive advantage. </p> <P> A report released in March by the Information Technology and Innovation Foundation and the Ewing Marion Kauffman Foundation ranked the innovation policies of 55 countries across seven core areas: trade and foreign direct investment; science and R&amp;D; domestic market competition; intellectual property rights; information technology; government procurement; and high-skill immigration. Their <a href="http://www.kauffman.org/uploadedfiles/global-innovation-policy-index-2012.pdf" target=_"blank">Global Innovation Policy Index</a> ranks each country as upper tier, upper midtier, lower midtier, or lower tier on each of the seven policy areas. Only Canada and Singapore placed in the upper tier for all seven indicators, while the U.S. placed in the top tier for every one except openness to high-skill immigration.</p> <P> While most IT pros agree that the U.S. needs to take steps to improve or maintain its standing as the leading global IT-based innovator, there's no consensus on how much the government needs to get involved. The authors of the ITIF-Kauffman report were careful to distinguish between government-orchestrated "industrial policies" that favor certain companies and technologies, and what they see as more productive policies that "support" industry players. But that's a slippery slope. </P> <P> <center><div style="font-size:.8em;"><img src="http://twimgs.com/informationweek/1338/338Rob_chart2.jpg" width="590" height="504" alt="In which IT areas do you see the U.S. holding a distinct global lead?" hspace="0" vspace="0" border="0" style="margin-bottom:7px;" /></div></center></p> <P> <center><div style="font-size:.8em;"><img src="http://twimgs.com/informationweek/1338/338Rob_chart3.jpg" width="590" height="504" alt="In which IT areas do you see the U.S. behind other countries" hspace="0" vspace="0" border="0" style="margin-bottom:7px;" /></div></center></p> <P> <!-- KINDLE EXCLUDE --> <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/83/8883/IT-Business-Strategy/informationweek-july-9-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1338/cov_110w.jpg" alt="InformationWeek: July 9, 2012 Issue" title="InformationWeek: July 9, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/83/8883/IT-Business-Strategy/informationweek-july-9-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> <!-- /KINDLE EXCLUDE --> <P>2012-06-13T13:40:00ZA lot. Consider the track records of some of the most acquisitive IT vendors over the past few years: Salesforce.com, Oracle, IBM, SAP, Dell, and HP.http://www.informationweek.com/news/240002003?cid=RSSfeed_IWK_authorsOne of the best measures of an IT vendor's state of mind and overall competency is its M&A activity. Is it among the last vendors into an emerging market with an acquisition, overpaying for a second-tier player? Do its acquisitions add up to something larger than the sum of their parts? Are its biggest acquisitions bold, even unconventional moves, or are they obvious ploys to buy revenue, market share, and new customers? <P> Consider a handful of the most acquisitive IT vendors over the last few years: Salesforce.com, Oracle, IBM, SAP, Dell, and Hewlett-Packard. What do the companies they're buying, and the point at which they're buying them, say about their ability to execute on a long-term strategy? A lot. <P> <strong>Salesforce.com</strong>. It's by far the smallest and most focused of the vendors in this cluster, and it's also the fastest growing, on track to <a href="http://www.informationweek.com/news/software/enterprise_apps/240000645">increase revenue 32% this year to about $3 billion</a>. It's leveraging a series of acquisitions to move beyond sales force automation into marketing (Buddy Media), HR (Rypple), and sentiment analysis (Radian6). The common threads: social-media-rich apps on a cloud base. Salesforce.com is a force to be reckoned with long term, assuming that it (and its $18 billion market cap) don't get acquired by one of the following players. <P> <strong>Oracle</strong>. Small and focused are hardly the calling cards of Oracle, which has acquired about 20 companies <em>since</em> its $7.4 billion purchase of Sun in 2010. Among those far flung purchases: Pillar Data Systems (storage systems), Endeca (e-commerce and business intelligence software), FatWire Software (Web content management), RightNow (cloud-based CRM apps), and Taleo (cloud-based HR apps). Oracle's common threads are its Fusion application suite (six long years in the making, knitting together its existing apps with its amalgamation of PeopleSoft, JD Edwards, Siebel, and other apps) and Exa-line of integrated hardware-software appliances. Oracle's financial success speaks for itself. But as my colleague Art Wittmann writes, <a href="http://www.informationweek.com/news/global-cio/interviews/240001682">Oracle's recent cloud announcement</a>, an attempt to roll up everything from PeopleSoft to Sun to RightNow to Taleo, was all over the map. Oracle may be doing well for itself, but it needs to do better for customers. <P> <strong>IBM</strong>. Say this much for IBM: It has a compelling vision, Smarter Planet, and it has acquired early and often to feed that vision. A prime example is its $3.5 billion acquisition of PWC Consulting in 2002, a bold move into business consulting. Another tenet of Smarter Planet is business intelligence and data analytics, now a core competency that IBM built on top of Cognos, SPSS, Netezza, and a number of smaller acquisitions. More recently, IBM has plowed into the next major business technology growth market, marketing automation, snapping up Coremetrics, Unica, and Tealeaf. <P> <strong>SAP</strong>. What do Business Objects, Sybase, TomorrowNow, SuccessFactors, and Ariba have in common? Not a lot--other than they were all big SAP acquisitions. The BusinessObjects (business intelligence) and Sybase (databases and mobile tools) deals have produced workmanlike results, while it's still too early to say whether SuccessFactors (HR) and Ariba (procurement) will elevate SAP into the cloud big leagues after the company's painfully slow start with Business ByDesign. An unmitigated disaster was TomorrowNow, which SAP acquired in 2005 to provide technical support services to licensees of rival PeopleSoft software. TomorrowNow, which SAP shut down in 2008, ended up costing SAP more than $300 million in legal damages, after it admitted to infringing Oracle's copyrights on PeopleSoft software. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> <strong>Dell</strong>. After eschewing acquisitions during its first decade, Dell has snapped up a range of mostly data center and cloud computing vendors during the past several years. EqualLogic and Compellent placed Dell firmly into storage. Force10 got it into Ethernet switching. SecureWorks, SonicWall, and AppAssure beefed up its security. And Clerity, Make Technologies, and Wyse will help Dell modernize customers' legacy applications. It's not sexy stuff, but it's a consistent, cumulative strategy. <P> <strong>HP</strong>. Last and possibly least is HP, which, on its third CEO in two years, is still vacillating when it comes to a vision. It parted with $25 billion to buy Compaq in 2002 and $1.2 billion to buy Palm in 2010, only to plot an exit from those businesses last year &#8230; only to reverse course (sort of) this year under new CEO Meg Whitman. HP shelled out about $10 billion for content management software vendor Autonomy and an undisclosed sum for analytics software vendor Vertica last year, following the failure of its internally developed Neoview big data platform and long after IBM and EMC had acquired market leaders in that sector. HP won a bidding war against Dell for storage vendor 3Par, but the $2.3 billion purchase price was more than twice Dell's initial offer. HP is still trying to make sense of its $13.9 billion acquisition of EDS in 2008. <P> <i>At this year's <a href="http://informationweek.com/conference">InformationWeek 500 Conference</a> C-level execs will gather to discuss how they're rewriting the old IT rulebook and accelerating business execution. At the St. Regis Monarch Beach, Dana Point, Calif., Sept. 9-11. </i>2012-06-01T09:07:00ZIn defining your company's core operations, is IT one of them? Many non-IT companies have patented, trademarked, or copyrighted at least one tech innovation.http://www.informationweek.com/news/240001213?cid=RSSfeed_IWK_authorsThe practice of vertical integration has been on the outs for a decade or two, as companies shed or outsourced ancillary operations in order to focus on their "core" expertise. That thinking has extended to IT, especially in the era of cloud computing: Why tie up internal resources building and managing data centers, infrastructure, and applications, the argument goes, when third parties can provide that technology more efficiently and effectively? <P> The decision comes down to your company's definition of core business. Is Ford a car and truck manufacturer, or is it the operator of one of the world's most sophisticated supply chains, requiring a wide range of IT competencies from start to finish? Is Amazon.com an online retailer, or is it a for-profit technology company whose world-class infrastructure underpins a variety of external as well as internal businesses? <P> Scores of companies, including NYSE Euronext, Sears, United Stationers, The Associated Press, Zynga, Google, and Union Pacific, not only are innovative users but also committed builders and sellers of IT systems, software, and services. NYSE Technologies, for instance, is pitching a range of transaction, infrastructure, and data services and software, mostly to other financial companies. The <a href="http://www.cloudcow.com/content/sears-new-line-cloud-computing-services">MetaScale unit of Sears</a>, launched in April, aims to sell Hadoop and other big data management services to "traditional brick-and-mortar enterprises" across all industries. <P> Union Pacific, the largest railroad company in the U.S., now generates $35 million to $40 million in annual revenue by selling, leasing, and licensing various technologies it owns and/or develops. For example, it was going to buy communications radios for its locomotives from a specialty manufacturer, but the engineers who work in UP's technology R&D lab said they could do the custom electronics for less. By developing the 8,000 radios it needed in-house and farming out their fabrication to a contract manufacturer, UP not only saved $7 million to $8 million, says CIO Lynden Tennison, but the subsequent sale of about 5,000 of those radios to a couple of competitors generated enough money to more than cover development costs. <P> Such examples, while not the norm, aren't the rare exception either. Consider that in 2011, <a href="http://www.informationweek.com/iw500/2011/top250">26% of <em>InformationWeek</em> 500 companies</a> had patented, trademarked, or copyrighted at least one tech innovation, implying that their IT organizations had moved beyond operating as strict cost centers. <P> If IT truly is intertwined with "the business," as <em>InformationWeek</em> has been chronicling for decades, then in-house IT expertise--whether it's for sale or competitive advantage--must be cultivated. It's certainly wrong-headed to suggest that most IT work is a mere commodity best left to cloud vendors, outsourcers, consultants, hosting companies, dev shops, and other outsiders. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> That was Enron's "asset light" business model, which the now-defunct energy company took to the extreme. Thinking that it was almost always more efficient for some third party to own and operate the gas pipelines, electricity grids, telecom infrastructure, and other assets on which its core businesses depended, Enron divested itself of almost everything--to the point that it had little "core" left. <P> The challenge is to find the middle ground--build best-in-class technical competencies and consider off-loading the true commodity work to others. But as Charles Babcock reports in an <em>InformationWeek</em> feature story on the costs of the cloud versus on-premises computing, sometimes it makes financial sense to keep even the commodity stuff in-house. (We'll publish that story in a couple of weeks.) <P> Before your IT organization jumps into selling its technology, ask several basic questions: <P> >> Have you run pilots to validate the business approach? <P> >> Does that business have adequate development, sales, marketing, and capital support? (Or would you be better off partnering with a company that has that expertise and those resources?) <P> >> Will the projected revenue make a material difference? Is the CEO and board committed to your creating and running, say, a $5 million-a-year business that distracts you from leading IT for your multibillion-dollar company? <P> >> Is everyone on board that you're not selling the company's competitive advantage? <P> "In most cases, the value proposition of these services needs to be linked to the overall value provided by the company," says Dave Bent, CIO of office supplies distributor United Stationers, which sells e-commerce and other software and services to its reseller and retail customers. "The combined value needs to be greater than the sum of the parts." <P> <strong>Rob Preston</strong>,<br />VP and Editor in Chief, InformationWeek<br /><a href="mailto:rpreston@techweb.com">rpreston@techweb.com</a> <P> <img src="http://twimgs.com/informationweek/graphics_library/misc/tweet_icon.gif" alt="twitter" width="15" height="19" hspace="4">Follow Rob Preston and InformationWeek on Twitter:<br/><a href="http://twitter.com/robpreston">@robpreston</a> <a href="http://twitter.com/InformationWeek">@InformationWeek</a> <a href="http://twitter.com/IWpremium">@IWpremium</a> <P> <em>To find out more about Rob Preston, please visit his <a href="http://www.informationweek.com/authors/showAuthor.jhtml?authorID=1026">page</a>.</em> <P> <i>At this year's <a href="http://informationweek.com/conference">InformationWeek 500 Conference</a> C-level execs will gather to discuss how they're rewriting the old IT rulebook and accelerating business execution. At the St. Regis Monarch Beach, Dana Point, Calif., Sept. 9-11. </i>2012-05-21T09:00:00ZImproving collaboration continues to top executive priority lists, so let's revisit whether they're "teasing out" the right tools and techniques.http://www.informationweek.com/news/240000626?cid=RSSfeed_IWK_authorsIt's been almost two years since I wrote a column titled <a href="http://www.informationweek.com/news/software/productivity_apps/227300062">"Down To Business: Why Some People 'Dread' Collaboration,"</a> in which I cited a body of research that showed unsatisfactory user experiences with social networking and other Enterprise 2.0 technologies. The Corporate Executive Board's Shvetank Shah weighed in that part of the challenge in fostering collaboration is for organizations to acquire a better understanding of users' workflows and the outcomes they want to achieve and then "tease out" the appropriate technologies, rather than just thrust collaboration platforms upon them. <P> Improving collaboration continues to land on the strategic priority lists of CIOs and other company executives--39% of executives in our <a href="http://reports.informationweek.com/abstract/83/8690/IT-Business-Strategy/research-global-cio-2012.html?cid=pub_analyt__iwk_20120312&ticket=ST-341012-RIEgciSGiRfSziMDwrNP-login.techweb.com">Global CIO survey</a> said they plan a major technology implementation in this area this year, making it No. 1 among 14 projects. So it's worth revisiting whether they and their organizations are in fact teasing out the right tools and techniques. <P> The short answer is that no one's got enterprise collaboration all figured out yet, owing to the dizzying array of platforms (SharePoint, Google Sites, Drupal, Yammer, LotusLive, Salesforce.com Chatter, Jive, Cisco Quad), various Web and video conferencing systems, and of course the legacy email, IM, and other platforms. Add to that the varying personal, cultural, and some even say generational preferences. And I think we still do too much thrusting and not enough teasing out. <P> <strong>[ Does social business translate into better business? Read more at <a href="http://www.informationweek.com/thebrainyard/news/strategy/232901667/how-to-design-a-social-business?itc=edit_in_body_cross">How To Design A Social Business</a>. ]</strong> <P> In an October 2011 <em>InformationWeek</em> survey that asked about enterprise use of social collaboration tools, 53% of the 452 IT pros who responded reported heavy or moderate use of online company directories (including those with profiles and photos) at their companies; 38% reported heavy or moderate use of team or company wikis; 30% of company discussion forums; and 28% of internal blogs. Those findings were little changed from a year earlier. But only 38% of the survey respondents characterized the overall success of their social collaboration tools as great or good. The rest rated them average (37%), fair (15%), or poor (10%). <P> The findings of a more recent survey, which we conducted in April, were more upbeat: 51% of the 405 respondents said they were either satisfied (41%) or very satisfied (10%) with their companies' social networking software. Only 32% were somewhat satisfied and 5% were unsatisfied. (The other 12% were still evaluating such software.) <P> So it appears that users are becoming more comfortable with their companies' social collaboration efforts. But pockets of discontent remain, our extensive reporting and research find. For some perspective, let's step back a bit. <P> In a thought-provoking blog post several years ago, current <a href="http://enterprise2blog.com/2008/09/social-media-vs-knowledge-management-a-generational-war/">BrainYard columnist Venkatesh Rao</a> made the case that the enterprise collaboration movement had lapsed into something of a "generational war" between advocates of social media tools and advocates of more structured knowledge management tools. Rao used as an example a tussle he had on a conference panel session with a middle-aged "architect of a major, moderately successful, stable, and decade-old KM effort." <P> "Where he advocated planning, I advocated ad hoc experimentation," Rao wrote. "Where he advocated charters to declare expected value, I advocated a 'you'll-know-it-when-you-see-it' approach to discovering value. Where he talked about convincing [subject matter experts], I argued that you should just watch for opinion leaders to emerge." <P> While Rao admitted to "setting the cat among the pigeons," his "us vs. them" POV is still common among social networking/Enterprise 2.0 advocates (even if you don't hear much about knowledge management these days). Long after I wrote the "Dread" column, in which I not only cited research but also related my personal frustrations with my company's wiki, I stumbled upon a series of rebuttals to my column--posted on the very same wiki by our community manager and a few of his fellow E2.0 professionals--in which I was portrayed as the stodgy traditionalist. (I chanced upon that thread while searching for something else; no one had offered me the opportunity to collaborate with the rebutallists.) <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> They made some valid points, the simplest of which is that you can't please everyone. Perhaps I pined for a "drop-in replacement" for my existing collaboration tools (mostly email and IM), rather than accept something truly new and different and more effective, one commenter suggested. <P> One respondent to our recent Enterprise Social Networking Vendor Evaluation Survey agreed: "The most challenging aspect of social networking for the enterprise is understanding the technology as it pertains to optimizing existing workflows. We tend to try to adapt social software to meet our (outdated) business processes, instead of seeing 'how things could/should be' and adjusting processes to take advantage of technology." <P> Fair enough. I'm never the first to embrace the latest technologies and approaches, but like most other professionals, I generally do get on board as a fairly fast follower once I see the utility. And I'm still not completely sold on enterprise social collaboration, at least my company's brand. My original point wasn't and isn't that our company wiki (based on Jive software and recently upgraded and renamed The Hub) is a poor platform for employee collaboration. It's a good one. At its best, it's a dynamic forum for discussing industry trends, business opportunities, ongoing programs, customer wins, product improvements, operational best practices, and myriad other issues. <P>And then there's The Hub's uber-benefit of driving enterprise-wide collaboration--breaking down departmental silos and promoting knowledge sharing among people who wouldn't otherwise interact with one another. My editorial colleagues and I have been exposed to some new people and fresh thinking on The Hub, even if we're not the most engaged participants. <P> For example, a month-old thread on The Hub about mobile applications lets participants see what's happening in other departments, ask pointed questions, grab ideas, and even change direction. In a global company such as ours, there's no way this collaboration would happen so organically otherwise. <P> At its worst, however, social collaboration can devolve into minutia. Too many cheerleaders aspiring to "guru" or "wizard" status. Too many congratulatory wishes, affirmations, and platitudes, all generating their own inbox-clogging email alerts (which users can turn off, but then they're pretty much out of the loop). A respondent to our recent Enterprise Social Networking Survey put it this way: "Social networking may work well, but not if it degenerates to the low density and high volume that email has." <P> Amen, brotha. <P> Meantime, the blunt conversations so important to doing business in real time get moved to email or IM or over the phone or in person. That's fine, as long as we all understand what enterprise social collaboration platforms do well (knowledge sharing, project management, team building, morale boosting) and how they can become a distraction (see previous paragraph). No single wiki, hub, portal, or forum can serve every corporate purpose. It's why unified communications is gaining so much momentum. <P> It's also the reason non-sanctioned social media platforms such as Yammer are so popular: They're off the corporate grid. Users feel free to speak their minds and get down to solving pressing problems without fear of a political backlash. Zoho, an Indian software-as-a-service provider, told me a few weeks ago about social freeware it has in beta called IT Pulse, specifically for IT organization collaboration, emphasizing that IT pros will have discussions on its platform they wouldn't feel comfortable having with the rest of the company. <P> One problem is that most CIOs don't want to support multiple collaboration platforms. And then there are those internal silos companies are looking to break down rather than erect. I'm not convinced there's much of a generational gap when it comes to embracing E2.0 tools. If some people do indeed "dread" modern-day collaboration, it isn't a Baby Boomer vs. Gen X or Gen Y thing, a type A vs. type B thing, or an extravert vs. introvert thing. It's a human thing. People are different; they collaborate differently. <P> Fostering social collaboration requires companies to constantly seek user feedback (my company recently conducted a survey of all employees). Which features are the most productive? For which kinds of work and communications is the platform most effective? Conversely, how is it being misused? What rules of engagement, if any, would users recommend? <P> The main job of the platform's steward, whether it's an IT director, community manager, or some other professional, isn't to be its promoter, though that comes with the turf. It's to plug in to user sentiments, positive and negative, and evolve the software and usage practices accordingly. Meantime, don't dismiss everyone who initially resists enterprise social collaboration as an outlier, Luddite, or malcontent. (I swear: I'm not.) <P> <i>The <a href="http://e2conf.com/boston?_mc=E2IWKPREM">Enterprise 2.0 Conference</a> brings together industry thought leaders to explore the latest innovations in enterprise social software, analytics, and big data tools and technologies. Learn how your business can harness these tools to improve internal business processes and create operational efficiencies. It happens in Boston, June 18-21. Register today! </i>2012-04-26T09:00:00ZThe Obama administration takes a hard line, while the Aspen Institute sticks with softer platitudes, as some governments try to restrict Internet freedoms.http://www.informationweek.com/news/232900946?cid=RSSfeed_IWK_authorsWhen it comes to assailing governments that oppress their citizens and choke their economies by controlling and manipulating the free flow of information, there's the hard approach and there's the soft approach. <P> The Obama administration on Monday took a hard line, <a href="http://www.informationweek.com/news/government/policy/232900736">authorizing sanctions against countries and U.S. companies</a> that help the governments of Syria and Iran acquire and use IT to track down dissidents or cut off their Internet access. The executive order effectively blocks, without notice, the assets of any entity that sells technology to Syria and Iran, or helps those governments deploy technology, that disrupts, monitors, and tracks their citizens' communications. <P> The U.S. Treasury Department will block funds and take other measures necessary to enforce the executive order, which is being carried out in the name of bolstering U.S. national security (tenuous link) and stopping Syria and Iran from "facilitating or committing serious human rights abuses" (much more to the point). <P> Critics immediately warned that the executive order's imprecise language could lead to unintended consequences--for instance, well-intentioned tech companies getting sanctioned because their products fall into the wrong hands for malevolent purposes. And <a href="http://fsrn.org/audio/obama-says-tech-sanctions-target-syria-iran-us-record-privacy-criticized/10181">privacy advocates complained</a> about hypocrisy from a U.S. government that tracks its own citizens for reasons of anti-terrorism. But at least Obama's executive order doesn't beat around the bush. <P> Then there's the soft approach, which the Aspen Institute takes with a new initiative called <a href="http://www.aspeninstitute.org/policy-work/communications-society/programs-topic/global-projects/idea">IDEA (International Digital Economy Accords)</a>. It's aimed at ensuring that citizens and consumers across borders "have a trusted, robust, and reliable Internet, where access is easy and where the rights of privacy, property, and security are respected"--all amid "the risk of political and technological disruption." <P> No one can argue with such an endeavor, but it's so broad and squishy and consensus-laden that it's almost pointless. The IDEA project, which "proceeded by means of four plenary sessions, multiple working groups, and a series of working papers and documents," released a 137-page report on Tuesday that's a textbook of think tank gobbledygook. It's filled with self-evident bromides ("at current growth rates everyone with Internet access will join the Internet community within a decade") and policy platitudes ("establish a fair, effective, and empowering system for governing the flow and use of data in a single global digital economy"). <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> The IDEA project has enlisted government bureaucrats, lawyers, academics, consultants, and executives from around the world to "develop a consensus view about the beliefs and values of the Internet" and "construct a means of implementing that view." But the report--at least this first one, as there are more to come from the IDEA participants--is short on implementation details. <P> The report's authors, alluding to "hard cases" (Syria and Iran are obvious examples), concede that IDEA won't succeed unless it can "resolve real cases of deviation from generally accepted principles and problematic cases of enforcement of said principles." In other words, unless the IDEA folks can get oppressive and totalitarian governments to come around to their way of thinking on Internet freedom and openness, their pronouncements are just a theoretical exercise. I didn't see any representatives of Syria or Iran (or North Korea or Cuba or China) on IDEA's committees of the good and great, and I don't think those countries are much interested in engaging in this "empowering" and "multistakeholder" dialog. <P> Most of us agree that an open Internet--one free of parochial regulations, pernicious government manipulation and control, commercial abuse, and criminal activity--is the ideal. But we must focus on the means of achieving those goals, not just the ends. <P> <i>Hacktivist and cybercriminal threats concern IT teams most, our first Federal Government Cybersecurity Survey reveals. Here's how they're fighting back. Also in the new, all-digital <a href="http://www.informationweek.com/gogreen/042312gov/?k=axxe&cid=article_axxt_os">Top Federal IT Threats</a> issue of InformqtionWeek Government: Why federal efforts to cut IT costs don't go far enough, and how the State Department is enhancing security. (Free registration required.)</i>2012-04-19T08:35:00ZA Citigroup shareholder vote puts compensation back into the spotlight. Don't run with the "inequality" crowd.http://www.informationweek.com/news/232900539?cid=RSSfeed_IWK_authorsThe contentious issue of executive compensation is back in the news following the vote Tuesday by Citigroup shareholders to oppose the pay packages for its CEO and other top execs. The class warriors at <em>The New York Times</em> seized on the opportunity to <a href="http://dealbook.nytimes.com/2012/04/17/citigroup-shareholders-reject-executive-pay-plan/?nl=todaysheadlines&emc=tha2_20120418">editorialize in their news pages</a> about national "income inequality" and "outsized compensation," suggesting that "anger over pay for chief executives has spread from Occupy Wall Street to wealthy institutional investors." <P> It's highly doubtful that those institutional investors, wealthy or otherwise, are now carrying the mantel of the OWS crowd. But clearly there's a movement afoot to hold executives more accountable and tie their pay more closely to performance. Last year, for instance, Hewlett-Packard shareholders for the first time voted to reject the compensation packages of top company executives, including CEO Leo Apotheker, who was forced to resign later in the year as HP struggled to define its strategy, excite its customers, and boost its profits. In May 2010, Motorola became the first U.S. company to fail to earn majority shareholder support for its proposed executive compensation plan. <P> Such "say on pay" votes, stipulated by the two-year-old Dodd-Frank financial regulations, are non-binding--but they're a step in the right direction. If you don't like what a CEO or some other muckety muck makes, then buy some shares in the company and make your voice heard. <P> Last year, only a tiny fraction of U.S. company shareholders voted against executive compensation plans, and even fewer companies followed through with actual pay cuts. And it's worth noting that in cases where shareholders <em>are</em> voting against pay packages, their majorities haven't been overwhelming. Some 45% of Citi shareholders supported the company's compensation plan at Tuesday's meeting; 48% did so at HP last year and 46% at Motorola two years ago. <P> In the Citigroup case, shareholders appear to have a legitimate beef, but compensation matters rarely are clear cut. Last year, total pay for the bank's CEO, Vikram Pandit, reportedly included a $1.67 million salary and a $5.3 million cash bonus, as well as a $40 million retention package that was to be awarded through 2015. What Citigroup investors rejected yesterday is a pay plan that awarded Pandit $14.9 million last year. (It's unlikely Pandit or the bank's other top execs will have to return pay they've already received.) <P> Pandit's $14.9 million in compensation is considerably higher than for the CEOs at comparable financial services companies, <em>The New York Times</em> reports, though he had accepted an annual salary of only $1 in 2009 and 2010 amid the financial industry meltdown. Meantime, the bar Citigroup set for executive incentive payments last year "was set ridiculously low," <a href="http://www.forbes.com/sites/halahtouryalai/2012/04/17/citi-ceo-vikram-pandit-gets-rejected-again/">according to bank analyst Mike Mayo</a>, quoted in a <em>Forbes</em> article. And consider that Citigroup's share price declined 44% last year. <P> This debate about "outsized compensation" wafts into the realm of the IT organization from time to time (I wrote <a href="http://www.informationweek.com/news/197001027">a couple of unpopular columns</a> on the subject a few years ago). For instance, it was reported several years ago that HP's then-CIO, Randy Mott, was awarded a $15 million compensation package, including stock options and bonuses. Without considering what HP got for its $15 million, critics complained that Mott was overpaid, as if IT executive compensation should be dispensed according to a civil service pay grade. Mott's IT consolidation and restructuring efforts ended up saving HP hundreds of millions of dollars while tying projects more closely to business priorities. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> Janco Associates last year published <a href="http://www.ejobdescription.com/Highest-Paid-CIOs.html">a list of top IT executive compensation</a>, gleaned from the financial reports of select public companies. Among the execs on its list were Aetna's executive VP of operations and technology, Meg McCarthy ($5.1 million), Boeing CTO John Tracy ($3.6 million), FedEx CIO Rob Carter ($3.2 million), and Home Depot CIO Matt Carey ($2.9 million). In comparison, IT executives at large North American companies earn median compensation of about $161,000, according to <a href="http://www.informationweek.com/news/galleries/global-cio/interviews/232900448"><em>InformationWeek</em>'s 2012 IT Salary Survey</a>. So does that mean the above CIOs and CTOs are grossly overpaid? <P> Of course not. You can't judge these things in a vacuum. The fact of the matter is, some executives are worth more than others--and some are worth a lot more. The competitive market decides, not some social justice arbitration committee. <P> Looking to another industry, Major League Baseball players' "exorbitant" salaries continue to rise because that semi-competitive labor market continues to support those huge raises. Much less so in the NHL, whose economics forced a realignment of player salaries a few years ago. Do baseball players "deserve" to make a lot more money than hockey players? Do they work harder? Are they "better" performers? Such assessments are irrelevant. The forces of supply and demand set the benchmarks, not some litmus test of what's "fair." <P> I've always found it a bit odd that people take issue with the financial success of others, as if that largesse is coming out of their pockets. But I can understand the angst when it comes to blatant underperformers. I'm no fan of big raises and bonuses for executives at companies that take taxpayer-funded bailouts. And while no one likes the huge severance packages ousted CEOs receive, they're the contractual cost of attracting big name executives, even if they end up feeling like "pay for failure" deals. <P> If you're a shareholder, employee, or big customer of a company and think its top executives are making way too much money, you have forums to express your dissatisfaction. Use them. Otherwise, such matters are rarely any of your concern. <P> <i>The <a href="http://e2conf.com/boston?_mc=E2IWKPREM">Enterprise 2.0 Conference</a> brings together industry thought leaders to explore the latest innovations in enterprise social software, analytics, and big data tools and technologies. Learn how your business can harness these tools to improve internal business processes and create operational efficiencies. It happens in Boston, June 18-21. Register today! </i>2012-04-05T11:29:00ZFed CIO Steven VanRoekel is making fiscal headway, but we need to see those billions saved actually fall to the bottom line.http://www.informationweek.com/news/232800352?cid=RSSfeed_IWK_authorsFederal CIO Steven VanRoekel maintains that over the past three years, the federal government "has done much in adopting private sector practices to triage broken IT investments, reduce the IT infrastructure footprint, and innovate with less." But by his own account, it hasn't done enough. <P> So last week, VanRoekel and Office of Management and Budget director Jeff Zients <a href="http://www.whitehouse.gov/blog/2012/03/30/applying-private-sector-best-practices-information-technology">introduced PortfolioStat</a>, a series of annual, data-based reviews of agency IT projects (more sweeping than the previous TechStat program), as well as a new requirement for fed agencies to develop consolidation plans for commodity IT services. All good--as long as these measures actually produce meaningful spending cuts rather than just shuffle federal IT dollars around. <P> In a memo announcing the two initiatives, VanRoekel calls out the Department of the Interior, which he says will realize $100 million in annual savings (on an IT budget of about $1 billion) from 2016 to 2020 "by modernizing IT infrastructure and aligning resources to improve customer service." Furthermore, he estimates that IT spending reviews already carried out at Interior have rendered $11 million in "cost avoidance" and $2.2 million in "redirection." Again, will any of that money drop to the bottom line? <P> The fact that Interior's fiscal 2013 IT budget is pegged to decline by $28.6 million--2.9%--compared with the previous year's budget is a positive sign. But let's see if the agency's annual IT budget falls by anywhere near $100 million between 2016 and 2020. <P> VanRoekel is quick to point out that <a href="http://www.cio.gov/FY2013-IT.pdf">fiscal discipline is returning to federal government IT</a>. After growing at a ridiculous compound annual growth rate of more than 7% between 2001 and 2009--pretty lean years for private sector IT organizations--federal IT spending has come in flat ever since. Still, at about $80 billion in aggregate, the federal IT budget could use a haircut. Instead, for every IT dollar budgeted to be saved next year at the likes of Interior (down $28.6 million), Housing and Urban Development (down $97.2 million), and Justice (down $102 million), an additional dollar will be spent at the likes of Agriculture (up $79.9 million), Veterans Affairs (up $216.1 million), and Treasury (up $358.7 million). <P> The same week in which VanRoekel and Zients rolled out PortfolioStat and urged IT consolidation, it was business technology as usual for half a dozen other federal agencies, as the White House unveiled an initiative under which Defense, Homeland Security, Energy, and a handful of other agencies will spend an additional $200 million on big data R&D. At a news conference, agency representatives "seemed more intent on <a href="http://www.informationweek.com/news/software/info_management/232800090">talking about their unique initiatives</a> and less focused on how they could collaborate with other agencies," noted my colleague Doug Henschen. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> Granted, some of their big data programs are agency-specific, but Henschen couldn't help notice that "amid the din of acronyms and price-tag-unknown projects, the same terms kept coming up: data volume, data variety, modeling and algorithms, data visualization, making information actionable, and so on." It smelled a lot like the kind of "duplicative" IT that VanRoekel and Zients are hoping to root out. <P> For all the talk about the government adopting private sector best practices, few people in Washington have shown they have the stomach or will to make the kinds of really hard decisions that companies make all the time--the kind that cut budgets rather than just keep them from expanding. Agency CIOs are apt to take their spending cues from the capital's politicians and career bureaucrats, for whom fiscal responsibility remains an alien concept. <P> Consider the federal budget histrionics this week. As part of his rebuke of the plan put forth by Wisconsin Congressman Paul Ryan, which proposes deep cuts in entitlement programs in an attempt to whack trillions of dollars in spending through 2022 from the Obama budget plan, the president claims to have already "eliminated dozens of programs that weren't working." But according to a <a href="http://online.wsj.com/article/SB10001424052702303816504577321974262655462.html?mod=djemEditorialPage_t"><em>Wall Street Journal</em></a> editorial on Wednesday, "the savings from these eliminations amount to less than 0.1% of the budget, or less than $100 million." That is, they're all show, no substance. Not that the Republicans were penny pinchers during the last administration. Far from it. During the eight years George W. Bush was in office, the national debt doubled to more than $10 trillion because of spending increases and tax cuts. <P> Ah, a billion here, a billion there and pretty soon you're talking <a href="http://www.dirksencenter.org/print_emd_billionhere.htm">real money</a>. <P> VanRoekel and his predecessor, Vivek Kundra, have done well to identify $4 billion in "cost avoidance" and "redirection" as a result of the TechStat program. Begin to lop those billions and more from future budgets, and we'll be more impressed. <P> <i>InformationWeek's 2012 Government IT Innovators program will feature the most innovative government IT organizations in the 2012 InformationWeek 500 issue and on InformationWeek.com. Does your organization have what it takes? The nomination period for <a href="http://informationweek.2012IWGovITInnovprereg.sgizmo.com?iwid=pl <http://informationweek.2012iwgovitinnovprereg.sgizmo.com/?iwid=pl> ">2012 Government IT Innovators</a> closes April 27. </i>2012-03-29T10:12:00ZThere's no manual for innovation, but consider these expert best practices and reader lessons learned.http://www.informationweek.com/news/232700475?cid=RSSfeed_IWK_authorsWriting about innovation is a lot like writing about politics or the environment: The subject matter is so broad and complex that it defies tidy overviews and prescriptions. So with that qualifier in mind, allow me to proceed with a handful of takeaways from the <a href=http://www.gsb.stanford.edu/exed/cio/>"Innovative CIO" program</a> I attended recently at Stanford University, as well as from readers who responded to my recent column <a href="http://www.informationweek.com/news/global-cio/interviews/232600922">"Innovation Doesn't Happen By Chance</a>." <P> <strong>1. Permit innovation.</strong> That's a no-brainer--far from an unconventional concept, you might think. But the reality is that most people simply don't carve out the time to think about innovation because there's no directive or permission from the top to do so. In most IT organizations, people are so busy keeping the lights on that they&#8217;re not anticipating what's next--the innovative business applications, systems, and processes that could yield a competitive advantage. <P> InformationWeek has written about companies that have set up IT-centric innovation teams to get their people out of their day-to-day comfort zones. Payroll and HR outsourcer ADP, for example, last year started an innovation lab, led by CIO Mike Capone, that consists of four or five permanent people, including so-called innovation experts, and another 15 to 20 IT pros who rotate into and out of the lab in six-month cycles. Casino company Caesars Entertainment several years ago created an innovation group, now led by CTO Katrina Lane, that draws talent from IT, marketing, financial planning, and other disciplines. It uses a rigorous process to propose, finance, pilot, and evaluate the results of its leading-edge technology initiatives. <P> David Robinson, CIO of Kansas City-based insurance brokers Lockton Companies, wrote me to advocate the old skunk works approach. Lockton's IT organization presides over no formal innovation team, but its people don't have to ask permission to go outside their everyday jobs. "Give people a specific challenge and then empower them to solve it without rules," Robinson says. "Most folks have the resilience and drive under such circumstances." Mutual fund company Vanguard is more ad hoc with its permissioning. When its IT organization is assembling a team for a cutting-edge project, it looks for volunteers, who log extra hours to work on the project while keeping their day-to-day responsibilities. <P> <strong>2. Get people jazzed.</strong> The process of innovation isn't an analysis of actuarial tables. It should be energizing, exciting, and inclusive of different job functions and personality types. <P> A famous Stanford case study of software development and engineering company Rite-Solutions and the internal innovation tool it created, a stock market game called Mutual Fun, provides a good example. In a nutshell, Rite-Solutions employees propose ideas--to save the company money or develop new products--as stock listings on the internal Mutual Fun exchange. Other employees help pick the winners (and losers) by bidding (or not bidding) their own virtual money on those stocks. So everyone at the company is encouraged to join the innovation process and have some fun in the process; it's not an exercise for a committee of the good and great. (Caesars is quick to note that its innovation group doesn't "own" IT-based innovation at the company but is charged with driving it.) <P> Mutual Fun appeals to a basic human need: social recognition. And because the collective bids ideas up or down, it's easier to kill the bad ones. "Bad ideas often win because of the skills of the communicator," observes Brian Lillie, CIO of data center operator Equinix, who helped organize the Stanford innovation program. "The organization becomes an echo chamber of the boss." <P> <strong>3. Get comfortable with failure.</strong> "In the corporate world, <a href="http://www.informationweek.com/news/global-cio/interviews/232602624">failure is an F word</a>, and you just don't talk about it," laments Steve Schlecht, CEO of clothing maker Duluth Trading Co. IT pros in particular gravitate toward peace of mind, what Stanford marketing professor Baba Shiv and his colleagues call the Type 1 mindset. They fear making mistakes. Organizations need to cultivate a Type 2 mindset, a fear of missing out on opportunities. It's the innovator's mindset. <P> Legend has it that in the early days of MTV, overseer Steve Ross would fire employees who didn't fail enough. Caesars' innovation group "pushes" for a 50% failure rate--it's an internal metric, not something Lane's team brags about. She figures that if the team's not failing that often, it's not pushing the envelope hard enough. <P> That doesn't mean these innovators <em>like</em> to fail--that is, don't get <em>too</em> comfortable with failure. Caesars, for instance, is very careful to manage risk and exposure as part of its innovation process. The idea is to fail fast (you've heard that before) and cheaply and learn from your mistakes, potentially sparking ideas for related innovations. <P> <strong>4. Start out raw.</strong> When putting ideas on the table and whipping them into shape, don't pine for perfection. In fact, it's better to set vague innovation goals and build rough prototypes, the Stanford experts say. Shiv talks about <em>jugaad</em>, a Hindi word that roughly means innovation on the cheap. The thinking is that you don't stimulate innovation by acting like you have most of it figured out from the start. It's a process that benefits from lots of starts and restarts involving lots of different people's input. <P> If you build a polished prototype, others will tend to look for flaws. But if you build a rough prototype, colleagues will tend to see opportunities and will jump into the "co-creation" process to make it better, Shiv says. "Ideas become their baby," he says. This approach is taught at Stanford's renowned Hasso Plattner Institute of Design, where the 40 or so participants in the three-day Innovative CIO program gathered for a couple of hours of hands-on learning. We were broken into groups of two and given an hour to discuss with our partners a recent gift we had given and then prototype a better gift-giving process, using only paper, marker, pipe cleaners, and other rudimentary materials. The exercise produced some clever ideas. (One entailed setting up a Mutual Fun-like gifting exchange for friends and family.) <P> Raw prototypes also encourage more honest feedback, says the design school's Evelyn Huang. If you put a lot of time into polishing up your presentation, your (generally nice) colleagues are apt to not want to hurt your feelings by criticizing it. Take the approach: "I know it's crap, so let's build from here," Huang says. (Back to learning from your failures.) <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> <strong>5. Instill a sense of desperation.</strong> When times are tough, like during a recession, the tendency is for everyone's head to stay down. When business is brisk, the tendency is to not mess with success. Neither environment is a petri dish for creative ideas. <P> In bad times and good, organizations must apply innovation pressure on themselves. Shiv recommends doing a "pre-mortem" exercise: Look ahead two, three, five years and assume that the business or some foundational IT project has failed. It forces organizations to face potential threats and address opportunities now, not when a crisis throws everyone into a frenzy. <P> <strong>6. Start off by talking with people.</strong> This beats fielding surveys. Our little gifting exercise started with a discussion with a real-life gift-giver, the "customer" of the process we were tasked with improving. It's amazing what you can take away from such informal chats. Ken Stewart, CEO of change management advisory firm ChangeForge, agrees. "I'm a firm believer that true insights come from interaction," Stewart wrote me in response to my recent column on innovation. "Executives who are most in touch with their customers and their markets often have the strongest 'innovation quotient.'" <P> <strong>7. Beware unintended consequences.</strong> Understand the difference between innovation to achieve a defined benefit and change for the sake of change. "The former is great; the latter can be both costly and disastrous," says reader Christopher Engel, a network infrastructure manager with software company Conxeo. "Even when change can be quite beneficial in one area it can lead to some pretty serious unintended consequences in others." Engel cites social media and mobility. Many organizations that rushed into those areas got burned because they didn't take the time to consider the risks, such as exposing sensitive company information. <P> "It's great that many organizations have 'innovation' champions," he says. "At the same time, they badly need individuals who can take a step back and take a long hard look at just what practical effects any given innovation is designed to achieve, along with the costs and potential unintended consequences. Unfortunately, whenever I hear someone pitching 'innovation,' a picture of the Titanic comes unbidden to my mind. The ship&#8217;s hull design was supposed to be quite the innovation for the day. Unfortunately, White Star Lines was so enamored of their unsinkable innovation that they didn't spend enough time thinking about the lifeboats."2012-03-22T14:15:00ZGoogle remains well positioned despite its missteps and setbacks.http://www.informationweek.com/news/232700083?cid=RSSfeed_IWK_authorsA Google executive, James Whittaker, recently left the company for his second tour at Microsoft, and in the aftermath he posted a <a href="http://blogs.msdn.com/b/jw_on_tech/archive/2012/03/13/why-i-left-google.aspx">blog on Microsoft's site</a> explaining why he left the search company. While promising "no drama" and "no tell-all," he nonetheless comes down pretty hard on his former employer. The crux of his disenchantment? "The Google I was passionate about was a technology company that empowered its employees to innovate," he writes. "The Google I left was an advertising company with a single corporate-mandated focus." <P> That single focus? Facebook. As Whittaker describes it, since co-founder Larry Page took over from CEO Eric Schmidt a year ago, all company divisions were on notice to put Google+ and social networking front and center. Whittaker writes: "Search had to be social. Android had to be social. YouTube, once joyous in their independence, had to be &#8230; well, you get the point. Even worse was that innovation had to be social. Ideas that failed to put Google+ at the center of the universe were a distraction." It's unclear what Whittaker thinks Google should focus on instead. He acknowledges that he's "never been much on advertising." Under Schmidt, he pines, "ads were always in the background. Google was run like an innovation factory, empowering employees to be entrepreneurial through founder&#8217;s awards, peer bonuses, and 20% time. Our advertising revenue gave us the headroom to think, innovate, and create." In other words, the worker bees generated the advertising revenues, giving the intellectuals the freedom to dream about self-driven cars and Google Goggles, "innovations" that had no material benefit to the company. Page ruined things by rallying Google employees around social and all that yucky advertising stuff. <P> <strong>[ Coming up with new ideas is just the beginning. Implementing them is the tricky part. See <a href="http://www.informationweek.com/news/global-cio/interviews/232602430?itc=edit_in_body_cross">Innovative Ideas Are A Dime A Dozen</a>. ]</strong> <P> But what Page astutely understands is that innovation for the sake of innovation doesn't pay the bills or support a $209 billion market cap. <P> Writing on CIO.com in a long column headlined <a href="http://www.cio.com/article/702348/Is_Google_Facing_the_Beginning_of_the_End_?source=CIONLE_nlt_insider_2012-03-20">"Is Google Facing The Beginning Of The End?"</a>, Rob Enderle, prince of pundits, piles on to Whittaker's post. In sizing up Google against the likes of Netscape, Sun, and Yahoo (companies he says lost their way chasing rivals and never recovered) and Apple, IBM, and Microsoft (companies he says lost their way but pulled things back together), Enderle urges Google to move past its Facebook envy. Unlike Whittaker, however, he doesn't turn his nose up at advertising. <P> "All of its focus should be on finding ways to make ads on the Internet more valuable and being the primary source for managing ad revenue for everyone," Enderle says. "Its winning formula was monetizing the Web, which is actually a super set of ads, but it is clear, institutionally, that Google is in denial about the real source of its success." <P> I'm not so sure Google is in denial about anything, though I do agree with Enderle and Whittaker that customers aren't clamoring for another social network. Where I disagree with them is on the depth of Google's problems. For all the concerns about Google's social awkwardness, it's still well positioned in three of the biggest markets of the day: search, mobile, and Web 2.0 collaboration. <P> But pundits will be pundits, divining the demise of even the most successful technology companies. What&#8217;s next--setting up March Madness brackets, starting with the top 64 industry players, and predicting, two by two, which tech companies will get knocked off? The reality is that while all tech giants make mistakes, some of them make huge mistakes, and the smartest ones figure things out. Think Apple, IBM, and Cisco rather than DEC, Netscape, and Kodak. Google and its leaders have earned enough cred here, killing off high-profile products and projects (Wave, Buzz, Gears, Knol, etc.) when they haven't panned out. <P> The Whittaker post is reminiscent of a <a href="http://www.nytimes.com/2010/02/04/opinion/04brass.html?_r=2"> <em>New York Times</em> op-ed piece</a> written two years ago by a former Microsoft exec, Dick Brass. Headlined "Microsoft's Creative Destruction," Brass contrasted Microsoft with innovation mavens such as Apple, Amazon &#8230; and Google. His main critique: Microsoft had become "a clumsy, uncompetitive innovator," despite having just reported record profits and revenue. His thesis: It was a company in decline. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> Now Microsoft is back (for now), having dedicated itself to the cloud, rededicated itself to mobile, and put its Windows and Office cash cows on more solid footing. Meanwhile, Google--despite the fact that its stock is trading near its 52-week high&#8212;is seen as the clumsy innovator staring at the "beginning of the end." <P> No question, Google is vulnerable. The prices it fetches per paid search click are down, and rival Facebook, as Whittaker suggests, "knows so much more" about its users than Google does, an attribute that appeals to advertisers and media companies. It's still not clear how Google will monetize its Android franchise, especially with its $12.5 billion acquisition of device maker Motorola Mobility. Evidence that Google is playing fast with users' personal data has led to <a href="http://online.wsj.com/article/SB10001424052702304692804577283821586827892.html?mod=djemTECH_t">regulatory probes in the U.S. and Europe</a>. <P> But the beginning of the end? Let's give Google's leaders a little more credit. <P> <i>The pay-as-you go nature of the cloud makes ROI calculation seem easy. It&#8217;s not. Also in the new, all-digital <a href="http://www.informationweek.com/gogreen/031412s/?k=axxe&cid=article_axxe_os">Cloud Calculations</a> InformationWeek supplement: Why infrastructure-as-a-service is a bad deal. (Free registration required.)</i> <P>2012-03-21T09:00:00ZReaders weigh in on training, internships, partnerships, and 'cut-and-paste robotic HR people.'http://www.informationweek.com/news/232602893?cid=RSSfeed_IWK_authorsIn response to my recent column challenging employers to step up to (and stop whining about) the <a href="http://www.informationweek.com/news/global-cio/interviews/232601751">IT "skills shortage</a>," I received thoughtful letters from current and former IT pros, consultants, integrators, academics, and vendor executives. What follows are their perspectives from the front lines. In short: They're not happy with what they see. <P> Several readers exhorted employers to engage with local high schools, technical schools, junior colleges, and universities to help refine their technical curricula as well as create internships and other work programs. <P> Mel Whiteside, director of engineering technology at Wichita State University, says community and technical colleges, in general, "love partnering with industry and providing low-cost, high-skilled training, whether it is in IT or other technical fields. This is one of the reasons they exist." Whiteside previously taught engineering design and AutoCAD for eight years at a community college outside of Wichita. <P> What frustrates him, he says, is that local tech employers would rather "whine and complain about skills shortages" than make the time and resource commitment to partnering with and advising local schools. "Business and industry must--yes, must--connect with and take advantage of their regional, taxpayer-supported community and technical colleges (and in some cases local universities) to attain the type of skilled worker they need," Whiteside says. <P> One positive example is <a href="http://www.interalliance.org/about.php">INTER Alliance</a>, a partnership set up in 2006 between Cincinnati-area employers and educators. INTER Alliance aims to "create a renowned, thriving, and sustainable pool of IT talent" in the region that "not only fulfills local demand, but also is strong enough to actually attract new employers." <P> <strong>[ Managing younger IT workers? Keep these tips in mind for a happier, more productive workplace: <a href="http://www.informationweek.com/news/global-cio/personnel/232602824?itc=edit_in_body_cross">4 Rules For Managing Millenials In IT</a>. ]</strong> <P> Member organizations, including Procter & Gamble, Kroger, Toyota, Microsoft, and Chiquita, work with local high schools and universities on IT courses, mentoring programs, career camps, Olympics-style competitions, paid internships, and work co-ops. One of the many benefits of INTER Alliance, says reader Andrew Young, a Kroger business analyst who brought the program to my attention, is that it helps students "see that even grocery companies like Kroger rely heavily on technology." <P> If your local CIO group isn't involved with such a program, it needs to start one--and start publicizing it. One reader who works at a community college didn't know where to begin looking for industry partners. For starters, I pointed him toward his local Chamber of Commerce and the national Society for Information Management (which has many local chapters). <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> Jim Downs, CEO of Chicago-based Connamara Systems, which develops custom applications for the financial trading industry, says his company typically hires candidates with undergraduate computer science or computer engineering degrees and two to four years of experience. But for less-rigorous programming jobs, he recommends that companies bring in bright high school grads who might not be interested in attending a four-year college, pay them a living wage, and train them as part of an apprenticeship program. <P> "Maybe this training program is only 18 months with real on-the-job experiences," he says. "At the end of the program, a job would be waiting. Hopefully, the best of the class can start contributing value to the company during the training program." <P> Downs says Connamara, which now has two openings for software engineers, "isn't quite large enough to take on such an effort, but we have started internal training programs to re-tool employees to help fill our shortages." <P>Another industry executive I heard from, the CEO of a Texas-based systems integrator, blames "cut-and-paste, robotic HR people" for corporate America's seeming inability to fill open tech positions with qualified people. Staffing companies, he says, depend too much on resume certs references rather than an understanding of what the job requires. "Experienced American citizens abound to fill jobs here or on foreign soils if senior technical management makes the time and accepts responsibility for properly interviewing job applicants personally <em>prior to</em> getting HR involved when hiring technology-skilled professionals," he says. <P> A reader who describes himself as "someone who has sat on many sides of the IT hiring and management desk" observes that companies looking to hire after the deep recession are seeking experienced business technology pros who can drive and manage IT projects in highly matrixed work environments. "These positions require people who have the ability to work effectively with internal and outsourced IT, the business side of the house, and are fully security-, audit-, and compliance-aware--especially as new cloud initiatives are deployed," he says. The problem is that the recession and "mass outsourcing" have driven many of the people who meet those criteria out of the IT profession, he says. "The smarter and more fortunate ones ended up in the consulting world, where they found higher salaries and much more flexible work environments, and they don't want to go back," he says. <P> Another reader, who just concluded a four-year job search, suggests that instead of having governments pour money into programs that train students or unemployed professionals "to do a job that polled well when our politicians funded it" (he cites green jobs as an example), we instead use that money to relocate skilled workers to where the openings are for their skill sets. (I assume that money would come in the form of tightly controlled employer subsidies rather than putting the federal government in the worker relocation business.) <P> The principal of a consulting firm in Georgia is looking to the pool of experienced mid-level professionals displaced by the recession. Another place to look is among the tens of thousands of returning military men and women. The National Guard, in association with three non-profits, has launched a national campaign to encourage small and midsize companies to post openings for skilled technical workers and a range of other positions on the National Guard's job bank. The program aims to serve not only unemployed National Guard veterans, but also those from other military branches as well as their spouses. Companies that want to post open jobs can do so <a href="http://www.centerforamerica.org/register.html">here</a>, free of charge. <P> <strong>Is Far Really Better? </strong> My father used to have an expression--"far is better"--which was his backhanded critique of people who thought they had to trek many miles to their favorite bakery, tailor, or some other proprietor when one just as good or even better was around the corner. We see the same phenomenon in IT circles. <P>One retired IT pro wrote me to relate the time he was assigned to supervise a few H-1B workers under contract at low hourly rates to deploy an ERP system. His manager brought the H-1B workers in--though none of them were qualified, he says--as an alternative to hiring or training staffers or contracting with a reputable local firm that bid a flat rate. <P> "The resulting programs didn't work properly, and some were never deployed," the former supervisor says. "The reputable firm was ultimately hired to do the projects (at the proposed flat rates), and a local consulting programmer was hired as an employee. The 'manager' responsible for this fiasco is still in charge and still resisting training for in-house staff." The mentality: Far is better. <P> A 61-year-old self-employed Oracle/JDE consultant and 40-year IT veteran wrote me to say he has been "watching this 'shortage' develop over the past 15 years" and is "constantly amazed at how shortsighted much of corporate America has become--'hit the ground running' and all the other euphemisms those corporate cheapskates have applied to acquiring temp and full-time labor." He relates how, back in the day, his uncle, a manager at a local GE factory, would discuss with him management's obligation to provide a productive work environment and advancement opportunities (including on-the-job training and outside classes) for those so motivated. <P> "Not anymore. The moral compass is busted," he says. The bottom line is all that matters. Hire only those persons who already have the skill(s) you need today; lay off the rest. No formal retraining, very little OJT--just too expensive." <P> If importing technical expertise or moving jobs offshore serves a company's best interests, then it should indeed move in those directions. I'm not here to indict an entire set of business practices. But more companies do need to look past their next couple of financial quarters. <P> While big American technology companies seek to import workers on green cards or temporary visas, some of their counterparts overseas are more inclined to plow some of their profits back into their workforces. Take Infosys, one of the world's most successful IT services vendors. Even with a population of 1.1 billion in its home country of India, it still faces shortages of key technical skills. So it's not only moving some of that work to its centers outside India (including partnering with Detroit's Wayne County Community College District to train software developers), but it also trains more than 14,000 people at a time at its 337-acre Global Education Centre in Mysore, India, the largest such corporate center in the world. Subject areas include consulting, software package implementation, systems integration, infrastructure management, and business process management. <P> "My challenge and advice to corporate America is to free up some of the billions on those balance sheets and provide some internal training to our own citizens," the 40-year IT veteran says. "Don't just sit on some <a href="http://technologyservicecorps.org/">TSC board</a> (although that's certainly helpful), but actually set up some internal training programs for current staff. You just might be amazed at the outcome--higher loyalty, more productivity, probably less turnover. <P> "Yes, it might hurt the bottom line a teensy weensy little bit in the short run. But in the medium to long run, America becomes much more productive. And when Americans have jobs, they spend, in turn supporting and boosting the economy." <P> <i>Nominate your company for the 2012 InformationWeek 500--our 24th annual ranking of the nation's very best business technology innovators. Deadline is April 27. Organizations with $250 million or more in revenue may apply for the <a href="http://informationweek.2012IW500pre-registration.sgizmo.com?iwid=pl <http://informationweek.2012iw500pre-registration.sgizmo.com/?iwid=pl> ">2012 InformationWeek 500</a> now. </i>2012-03-07T12:10:00ZMicrosoft, Apple, and others have commissioned studies showing they're spawning thousands of jobs. But they don't tell the whole story.http://www.informationweek.com/news/232602179?cid=RSSfeed_IWK_authorsIT vendors and policy makers are taking credit for creating many millions of new U.S. jobs, even as the national unemployment rate hangs at a disconsolate 8.3%. Are other parts of the economy really losing jobs as fast as the tech industry is spawning them, or are these job-creation claims at best overstated and at worst a bunch of bunk? <P> The most recent claim comes from research firm IDC, in a <a href="http://www.microsoft.com/presspass/features/2012/mar12/03-05CloudComputingJobs.mspx">report commissioned and touted by Microsoft</a>, which maintains that the cloud computing movement will generate 13.8 million tech and related jobs worldwide by 2015, nearly 1.2 million of them in the U.S. and Canada. <P> In driving home its claims, it's logical for Microsoft to point to cloud providers such as Vorsite, a Seattle-based partner that plans to double its workforce this year. But Microsoft and IDC also argue that the economies of scale of public and private clouds, by lowering customers' IT and process costs, will free up funds for new business investment and innovation that ultimately will add jobs. Left out of their analysis is the fact that those efficiencies are achieved mostly through infrastructure consolidation, which eliminates IT jobs even if it spawns jobs elsewhere. No doubt those jobs elsewhere are more productive jobs, but putting a number on the net gains in this case is more guesswork than science. <P> Microsoft isn't the only one playing fast with the jobs numbers. Apple, under fire for labor practices in some of its offshore suppliers' factories, last week released the results of a <a href="http://www.apple.com/about/job-creation/">study it commissioned</a> claiming it's responsible for creating or supporting 514,000 U.S. jobs--257,000 of them at partner and supplier companies such as glass manufacturers and shipping companies; 210,000 of them at third-party app development firms; and the remaining 47,000 under its direct employ. The assumption, of course, is that those jobs wouldn't exist were it not for Apple, but taking just one example, we can't assume that all Corning employees producing glass for the iPhone would be out of work otherwise. <P> Thankfully, the firm that conducted the study for Apple, the Analysis Group, didn't include in its job-creation estimates wealth managers, car salesmen, tailors, pizza delivery guys, and others who may (or may not) owe their livelihoods in some way to the financial largesse of Apple and its employees. In estimating its indirect job-creation numbers, the Analysis Group did apply an "employment multiplier," developed by the federal Bureau of Economic Analysis, to the amount Apple spends on goods and services. But such multipliers are notoriously imprecise. As a <em>New York Times</em> article noted on Sunday, <a href="http://www.nytimes.com/2012/03/05/technology/apple-study-on-job-creation-spurs-an-economic-debate.html">Congressional Budget Office estimates</a> of how many jobs the 2009 federal stimulus created fluctuate wildly, between 1.6 million and 8.4 million. <P> A separate <a href="http://www.technet.org/wp-content/uploads/2012/02/TechNet-App-Economy-Jobs-Study.pdf">study commissioned by TechNet</a>, a lobby group representing tech industry CEOs and other top executives, found that the so-called App Economy--third-party development of lightweight apps for not only Apple platforms, but also for Amazon, Google, RIM, Microsoft, Zynga, Facebook, and a range of others--has created a total of 466,000 direct and indirect U.S. jobs since the iPhone and its app store construct were introduced in 2007. <P> That study, released in February and written by Michael Mandel of South Mountain Economics, uses a multiplier to estimate the App Economy employment "spillover" to the rest of the U.S. economy. Mandel noted that multipliers of between 2.4 and 3.4 have been used to estimate the job impact of broadband, and those have been carried to other studies "no matter how outrageous they are." So he settled instead on a "conservative" multiplier of 1.5: Every App Economy job generates another 0.5 jobs in the rest of the U.S. economy. That rough estimate sounds reasonable enough. <P> But no IT sector attracts as many job-creation shell gamers as mobile does. AT&T, in its desperate attempt to <a href="http://www.informationweek.com/news/global-cio/interviews/232200402">win approval for its (now dead) $39 billion deal to acquire T-Mobile</a>, had the gumption to argue that the merger would create thousands of new American jobs. AT&T attached some of those jobs to the "billions" it said it would spend to expand its mobile broadband network following the T-Mobile acquisition. And in an offering to the U.S. regulatory and Big Labor gods, it promised to bring back to this country 5,000 wireless call center jobs it had outsourced to other countries. But the fact of the matter is, mergers on that scale <em>always</em> result in a <em>net</em> job reduction as the alpha company eliminates redundant positions. <P> Remember the <a href="http://www.informationweek.com/news/183702784">metropolitan Wi-Fi movement</a>? Government muckety mucks and mobile industry execs talked up public-private Wi-Fi network partnerships for Philadelphia, San Francisco, suburban New York, and smaller metro areas as a way to create thousands of jobs while closing the "digital divide"--even if the technical and economic underpinnings of such large deployments were tenuous. Metro Wi-Fi service providers went bankrupt, equipment vendors sought higher ground--and the government opportunists moved on to the next big thing. <P> <!-- KINDLE EXCLUDE --> <!-- GLOBAL CIO GLOBE --> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> <!-- /GLOBAL CIO GLOBE --> <!-- /KINDLE EXCLUDE --> <P> More broadly, as part of the FCC's national broadband plan, the agency aims to free up 500 MHz of unused or underused spectrum now controlled by broadcasters and auction it off for broadband wireless communications. It's a worthy goal. But rather than sell the plan based on what it will produce--show how boosting broadband wireless connectivity will drive up productivity, output, and commerce nationwide--FCC Chairman Julius Genachowski has treated the proposed auctions like a government jobs program. "My message today is simple: We need to get it done now and we need to get it done right," he told an audience at the Consumer Electronics Show in January. "Few areas hold more promise for creating jobs than mobile." <P> Another sector with glowing promises of big job creation is big data. Anecdotally, CIOs we talk with are looking for business intelligence and analytics experts. And according to a <a href="http://www.mckinsey.com/Insights/MGI/Research/Technology_and_Innovation/Big_data_The_next_frontier_for_innovation">report last May from McKinsey & Co.</a>, U.S. organizations could face a shortage by 2018 of 140,000 to 190,000 people with "deep analytical skills," as well as 1.5 million managers and analysts "with the know-how to use the analysis of big data to make effective decisions." Unclear is whether the big data movement will create lots of new jobs or mostly require lots of new training and skills for existing positions. <P> We're presented with the prospect of so many new jobs, yet as of January, 12.8 million people in the U.S. couldn't find one and 1.1 million more had given up trying. A mismatch of skills explains some of that unemployment, but the brutal reality is that advances in IT and other fields permanently destroy some jobs and send others offshore. <P> No question, such "creative destruction" is absolutely essential, as innovative business models, technologies, and processes replace legacy ones. And no doubt technology remains one of the biggest job creators in this country, even if some of those jobs are moving to other countries. But let's not sugarcoat or oversimplify what it takes to get from here to there. <P> <P> <i>Nominate your company for the 2012 InformationWeek 500--our 24th annual ranking of the nation's very best business technology innovators. Deadline is April 27. Organizations with $250 million or more in revenue may apply for the <a href="http://informationweek.2012IW500pre-registration.sgizmo.com?iwid=pl <http://informationweek.2012iw500pre-registration.sgizmo.com/?iwid=pl> ">2012 InformationWeek 500</a> now. </i>