Commentary
2/1/2011
08:34 PM
Bob Evans
Bob Evans
Commentary

Global CIO: $100-Billion Tesco Kicks CIO Upstairs To CEO

As the $100-billion retailer accelerates its use of IT as a strategic weapon in its global expansion, Tesco CIO Philip Clarke will take the reins as CEO on March 1.



While it's accurate to call Tesco a retailer, that term simply doesn't do justice to the far-flung achievements and aspirations of the $100-billion British company. Tesco does indeed operate retail stores—more than 5,000 in 14 countries around the globe—but it also offers banking, insurance, travel services, online shopping, mobile phone services, weight-loss consulting, vision care, mobile applications, and more.

To optimize all of those opportunities, and to manage simultaneously its consistent growth not just in its U.K. home base but in China and its other emerging markets, Tesco knows that technology is an indispensable strategic asset in everything from leveraging grocery-shopping affinity accounts with mobile-phone merchandising to overseeing global supply chains to making each of Tesco's many millions of customers feel that the company is willing to reconfigure itself to suit his or her needs.

And to ensure the company has the right blend of leadership and vision to exploit all of those opportunities and to uncover new ones, Tesco is elevating its current CIO and head of international business, Philip Clarke, to chief executive effective March 1.

While that type of CIO ascendancy is unusual—especially at a company of Tesco's size—we seem to be reaching a point where the responsibilities that business-centric CIOs are seeking and receiving will make more and more of them fully legitimate candidates for CEO positions.

As I wrote last month in Global CIO: The Top 10 CIO Issues For 2011, CIOs can no longer operate as second-class C-level leaders whose fancy title outflanks their actual immersion in their companies' strategic direction, revenue growth, customer engagements, and market opportunities.

"Like the cranks who frothily peddled the notion that vaccinations trigger autism, too many uninformed tech-strategy charlatans are still pushing the ancient and empty bromide that CIOs need to 'request a seat at the table,' " I wrote in describing the fully evolved role of the CIO.

"That load of crap will be buried once and for all in 2011 because CIOs who haven't earned that C-suite credibility and autonomy by virtue of their visions and their achievements will be long gone by the time winter turns to spring for the simple reason that businesses without aggressive tech capabilities won't be able to compete in the coming decade.

"No matter how slick their marketing or how rosy their past, and no matter how big their market share or how high their CEO's profile, those IT-stunted companies will be pulverized in the coming year by a lethal combination of faster/smarter/better competitors and uninspired and disengaged customers.

"2011 is the year in which the CIO profession—once and for all, permanently and without any do-overs—casts off all of the residual crutches that have for so long often rendered CIOs last among C-level equals. Among the all-time stinkers in that smelly pile are ones like 'we're a support organization' or 'the business just doesn't understand IT' or 'we can run what we have, or we can innovate, but we can't do both.' " (End of excerpt.)

For Tesco's Clarke, the journey to the top of a global retail powerhouse with almost half a million employees began 36 years as a stockboy in a Tesco store managed by his father, according to a news article in the U.K.'s Telegraph.com.

Here's an insightful excerpt from that piece:

After graduating with an economics degree from Liverpool university, he joined Tesco's management trainee scheme in 1981. Roles as a store manager, product buyer and marketeer followed.

He joined the Tesco board in 1998 and has worked closely alongside [outgoing CEO Sir Terry Leahy] as the group has expanded overseas, taking on the likes of Wal-Mart and Carrefour.

That international experience, say sources, was key to him winning the job. Tesco's growth in the coming years will likely be driven by the success of its international operations. (End of excerpt.)

That's certainly true, but Clarke's outlook also underscores that he'll be leaning on his experiences in orchestrating a massive set of global applications and processes as Tesco continues to expand into new geographic markets with new offerings for consumers. "The delicatessen counter in China has to be different from the delicatessen counter in Korea, but behind the scenes we have tried to make sure that our business processes, our systems, our structures—everything is laid out for countries," Clarke is quoted as saying in the Telegraph.com piece.

Clarke led Tesco's expansion into India and South Korea, the article said, and among his priorities is ensuring that Tesco has not only the systems required to operate on such a scale, but also the collaborative culture that will allow it to move as fast as its customers in pursuing ideas and opportunities. And to do that, Clarke told the Telegraph, he'll need to spend significant time away from corporate headquarters and be immersed in the marketplace with customers, suppliers, stores, and employees—all of which sounds like perfect advice for today's CIOs, whether or not they aspire to be a CEO.

"I'm not going to run Tesco from Cheshunt," he said. "What I love to do is walk the stores, meet the staff and listen to the customers, because it all happens there. As chief executive my job is to be sure that we are meeting the needs of customers and that we are looking after our staff."

Replacing Clarke as CIO will be the company's current IT director, Mike McNamara, who as CIO will report to Clarke, according to a news story on the computing.co.uk website. Earlier in his Tesco career, McNamara had been the CTO of the retailer's online business.

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GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO,
or write to Bob at [email protected].

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