IT is the business

Paymark CIO Richard Tims explains why it is crucial for IT to build and maintain relationships with the business, learn to speak their language and to always focus on business outcomes.

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Richard Tims doesn’t believe in having a “strategic plan” for IT. “It should, in essence, be part of [the] overall business strategic plan,” says Tims, chief information officer of Paymark, which owns the largest Eftpos switch in New Zealand. “All projects, IT or otherwise, are about business outcomes and need to be justified on that basis. I don’t think I am doing my job unless that is the case.”

Tims, who was CIO of the Year in the 2005 Computerworld Excellence Awards, explains that at Paymark, close alignment between business and IT is critical, as at least 90 per cent of all their projects have an IT component. This is true, he says, even for infrastructure projects because there must be a related business benefit or fit with a strategic objective.

Some IT initiatives are recorded separately as individual projects. However, the majority are incorporated as part of key business initiatives, emphasising the support role IT plays, says Tims. This ensures IT maintains focus on the correct priorities and key business imperatives within the company, whether IT specific or related to a specific business requirement.

Applied lessons

This alignment proved beneficial recently when the ICT team delivered a business project with a major technology component.

The project revolved around the installation of a new data warehousing and mining tool for Paymark.

Tims explains the company has kept the majority of the generic transaction data since Eftpos transactions began in 1989, but it did not have the mechanism that could gather the information quickly and easily, and get the trend analyses that are critical for the business to make informed decisions.

Reporting under the old system required resources that were “quite specialised” and meant other competing business priorities had to be set aside, explains Tims.

The data was held on the mainframe. “We had tapes. When we needed to access it, we restored it and ran queries against it,” says Tims, in an interview at Paymark’s headquarters on the 23rd level of the ASB Centre in Auckland.

“We really wanted a solution with fast and easy access to that data from a business perspective. We are 75 per cent of the transactional market for Eftpos. We have got years and years of data available to us and the trend in history information is quite important.”

Tims was attending the CIO Conference in Auckland two years ago when he saw an exhibit for Sybase IQ. He and Jason Gill, manager, solutions and support, Paymark, decided to check out the system.

Last November, Tims and Gill worked with Sybase for a proof of concept, by loading two years data into the system. “We allowed that to run at Christmas, the busiest period of the year; it proved itself.”

The proof of concept, which lasted three months, actually became the initial pilot, explains Wayne Kedzlie, Sybase country manager.

Gill presented the project to the executive and initially chose two key business users. In the end, 15 business users were using the dashboard and providing feedback.

Tims says all this data is valuable from a trend perspective. “This year for the first time we are able to get down to a detailed transaction-per-second rate.

“That was quite a milestone for us because we always measured ourselves on 15-second bursts, but not really realising how much peaking and troughing there is within a 15-second burst.”

The whole point of the pilot was to get this in front of them [the business users] and get them to see the benefit,” says Tims. “We tried to look at these types of tools before and we wanted something for them to see. When they saw the speed and ease with which they got the data, it meant us going from pilot to business case was actually straightforward.” At the same time, he noted that the product runs on standardised hardware, which meant Paymark did not have to invest in new and expensive hardware. “It was not a hard sell to the business. In fact it is the business driving the business case, which is the way it should be.”

Gill, whose solutions team was the project sponsor, collected positive feedback from the users, “from the CEO, downward”. Like Tims, he knew the project will get support from the business when “they were relying on the data to do their jobs”.

Before this, recalls Tims, “End users would run their own little database and spreadsheets. They would go to the solutions team and tell them they need a report, save it and then run macros, etc, to get their information. Basically it was spreadsheets all over the place.”

Gill says the business users sought his help to run a report and when told they had to schedule the work, they would usually respond with ‘I need that now’.

“There are always conflicting priorities with other projects,” says Gill.

With the new system in place, the solutions team now gets fewer similar requests from the business. “Because it is so fast, there is no need to store that information as a backup. They know they can have access to it if it is in the data storage and it is easy to access and easy to customise.”

With hindsight, Tims says he would probably have shortened the proof of concept stage as both IT and the business saw the benefits early on.

For CIOs deploying a similar project, Tims says it is critical to understand your own data. “You can open a can of worms,” he says. “It is quite important for all stakeholders to make clear what they want from this thing and who will have access.”

Tims admits not all projects the ICT team rolled out were as successful as this. “Where we fell down in the past was the project was probably technology led. It didn’t really have the buy-in and the support.”

Get the house in order first

Tims reports to the chief executive, but is adamant involvement of the CIO in organisational strategy can only occur when the IT department is functioning well.

“You need to get the fundamentals of the IT operations sorted before you will have the credibility to make other contributions to the business,” he says.

“Keeping the systems running cost effectively and reliably is usually the key part of the CIO’s role and they must be operating smoothly before you can effectively broaden your involvement into strategy. Get the house in order first!

“IT by itself does not necessarily provide strategic advantage. Inherently it does because it creates possibilities, but it is how companies utilise this that is more important.”

Being involved in strategy requires demonstrated capability, notes Tims. “It is incumbent, I think, on any executive, not just the CIO, to contribute more than just in their respective areas. The last thing I want is to be labeled only as a propeller head!

“Talk to your peers and understand their drivers versus your own — you need healthy relationships with other executives and be able to speak their language.”

It is also advisable to take a bigger picture approach in your work. “As CIO you sometimes need to divorce yourself from the delivery aspects of the IT work stream and continually reaffirm why, as a business, you are doing things,” he states. “It is all too easy to lose sight of this and only focus on IT outputs rather than an overview. Oftentimes, IT is in the best position to see everything that is going on within the business and this is where real value can be added.”

“Don’t get too caught up in the hype of the latest fads which are often seen as the next silver bullet,” he further advises. “The business will soon grow tired of this especially when it does not deliver to expectations.

“To consistently solve business issues you usually cannot rely on just one framework and expect it to solve everything for you - you need to use the relevant aspects of many frameworks and avoid the labels associated with them.”

This month, Tims brings these insights to another organisation. By the time this article is in print, Tims is working at the New Zealand Lotteries as chief technology officer, reporting to the chief executive.

Sidebar: Teambuilding 101

Paymark CIO Richard Tims lists the following core strategies for the management and development of the IT team.

Allow staff the freedom and confidence to make decisions, but also to be accountable for those decisions.

Commit to investing in staff with both technical and non-technical training — IT training can often be technical only — and not forgetting that managers need training as well.