The huge poster beside the lift, by the entrance of his office, is a daily reminder of the tasks that lie ahead for Glen McLatchie and his team at SkyCity.
It is an illustration of the SkyCity complex - the familiar tower looming over several buildings, surrounded by the technology and digital processes that encourage innovation and agility across its multifaceted businesses.
Below it is a hive of activities - cross-functional teams working on a raft of technologies, both on premise and in the cloud - spread out across stairs leading to the top, the SkyCity complex laid out on a green backdrop.
Around the complex are descriptions of the desired end state such as: ‘technology as the enabler, not the inhibitor’; ‘agile working model’; ‘digital view of the customer’; ‘innovation as BAU’; and ‘ease of access to data’.
“This is our target state, the digital transformation expressed in business terms,” says McLatchie, who joined SkyCity close to three years ago following CIO roles in the energy sector.
“Everybody wants to be there, but the cold reality is you have to address the fundamental issues. You have to build the stairs.”
McLatchie explains this has been the focus of his team for the past two years.
“There is no legacy system that is not being replaced or upgraded inside our organisation,” he states.
“We are touching every part of the business: learning and development, rostering, hotel management, convention management, point of sale, financial, supply chain, data management, customer experience, parking...The list goes on and on and on.”
In this exclusive interview with CIO New Zealand, McLatchie shares how he and his team are leading through this complex business change.
First step: Assessing the task ahead
“When I came in, I walked the sites in Australia and NZ and spoke to users at all levels of the organisation and was somewhat surprised to see the level of technical debt.
The level of system maturity was incredibly low being multi generations behind current versions across the entire stack, and the level of understanding of the technology we were working on was absent. There was very little documentation, process or methodologies in place.
We had a handful of heroes keeping the place running. They were all capable individuals but operating in a break fix mode, they were also single points of failure in terms of risk.
We had to lift our capability and get ourselves out of the technical debt before we were able to talk to the business with any credibility about a target state of enabling technologies.”
The root cause of the problem was an underinvestment of technology for over a decade.”
Getting executive support and critical funding
“I looked at the collective risks and supported by a number of audits presented these to the board as an unacceptable risk position.
There were three levels of risks:
Technology failure - a result of unsupported and aged systems,
Cybersecurity - a result of a low maturity in terms of our security posture, and
Inhibited growth - a result of an inability to interface into aged systems and get access to core business data, inhibiting digital enablement.
I described the situation to the board as not being unique to SkyCity. Many organisations face these very same issues, it’s how you address the root cause of the problem as opposed to the symptoms of the problem that is key.
I’ve seen many organisations look for solutions to the symptoms of poor IT without fully recognising the root cause of the problem. We’ve all seen this occur, ‘IT is not delivering’ so wholesale outsourcing occurs, large complex ERP programmes are kicked off, rapid fire sacking of the CIOs or reporting line changes, new roles are created like head of digital, or innovation hubs are set up in an attempt to fix the issues being experienced – poor technology enablement and adoption.
None of these are bad things in of themselves, but they are not a panacea for the root cause of poor technology management and underinvestment.
We couldn’t simply look at digital enablement as customer facing apps only. We could never deliver sustainable business outcomes unless we addressed the fundamental cause of the trouble, the aged systems and lack of capability to actually deliver anything. Otherwise, we were simply papering over the cracks. This was a digital transformation in its truest form, across the entire stack.
It is an arduous and tough journey, because it’s not what people want to hear. But the board and Executive understood, and we had great support from our CFO.”
"Ensuring alignment on the role of the IT function was a critical step.
I defined the role of IT as providing the perfectly balanced state for the business to operate in. Continuously managing the balance between the cost of operation, security, business risk, business enablement, agility and innovation. This balanced state does not mean that business users get everything they ask for. Rather, it means that the right investment is being made at the right time for the right reasons.
Under this approach, IT staff become professional business technologists as opposed to service delivery order takers. Internal IT staff have competencies distinctive to the business beyond core technology competencies that can simply be sourced off the street. In simple terms, they understand the business and have a professional view on what is the right approach to technology investment for the SkyCity group.
This was a very different approach for SkyCity. For this to occur, a mature IT governance and funding model needed to be in place along with an appropriate partnering model between the IT function and the business units it services.”
Making the change real
“We had to really challenge the way the organisation thought about IT. It was important to talk to them about what could and should be delivered and what could not be delivered.
We started by having the IT staff think about the business user as a partner that we provided professional services to rather than a customer, which had previously been driving an order taking mentality.
I needed the IT staff to feel safe to challenge business users and be able to say, ‘actually, the decision you have made around this technology tool isn’t optimal.’
And, to offer a professional service to help make the right decisions at the right time for the right reasons.’ This was initially challenging for the organisation to get their head around.
Today we are in a great position, we’ve moved away from local systems for local users and take a more holistic group wide view of solutions. We have lifted IT to the level of maturity that is right for a listed company of our size.
The Executive and GMs feel comfortable about how we work alongside them and challenge each other to make suitable technology choices - what they need to do, what we should be delivering, when we should be delivering, and how we should be delivering their business solutions.
Our funding has more than doubled which was a critical component to be able to deliver the transformation programme.”
There is no legacy system that is not being replaced or upgraded inside our organisation
“What we have seen over the past two years is that there has been a complete shift, a fundamental shift in how the business engages with ICT and uses technology.
There has been an alignment and a level of collaboration between operations and ICT not seen inside the organisation before."
Tackling the non-technology side
“The cultural shift for the team has been significant.
This was key for me, until you get the culture right, until you make it a safe, happy, fun place to work... nothing will change. No matter how much process or how many people you change and move in the organisational structure, it is really difficult to deliver change as significant as what we are delivering here at SkyCity, if you don’t address the culture.
The company is such a fun dynamic entertainment business. Yet the culture and approach to technology was a corporate overhead that we had to drive cost out of. Versus, technology as a critical enabler for the business. This certainly created an ICT team that had to say ‘no’ to almost everything because there was no funding.
The net result was shadow IT all across the business. I am not talking about shadow IT of a couple of Business analysts and Project managers. We had network engineers and shadow data centres.
So, there was a lot of work to do to get people on side to trust ICT again, and to get IT people comfortable about who they were and their role as IT professionals.
We started bringing new people into the team to lift the expertise and supplement the current skills.
It was challenging for a lot of the existing staff because we completely changed the structure and reporting lines, including bringing in a new leadership team with experience in large change programmes. But it also opened up new opportunities for our real stars.
The net result is we now have an amazing team of people that I’m really proud of. Every single one of them is a high performing individual who brings their ‘A’ game to work every day. We have a bit of fun and we work hard as well. The culture is such that we can have intelligent, challenging conversations and feel safe doing it.
Every role I’ve ever been in has been about the people, as the Maori so correctly say, ‘He Tangata, He Tangata, He Tangata.’ It is the people, it is the people, it is the people."
Next: 'We’ve made a conscious decision not to be too distracted by the shiny things'
Join the CIO New Zealand group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.