These days, it is not enough for the IT organization to be “aligned” to the rest of the business; IT needs to go one step further and be integrated with its business partners. When IT is integrated, technology deployments and business process improvements are two sides of the same coin, each informing the other.
This is a wonderful concept, which makes great sense on paper. The challenge to IT/business integration, however, is tremendous, and it involves your most important asset, your people. IT people continue to grow up in the IT organization, and business people grow up in the business. These professionals know their discipline well (marketing systems OR supply chain processes OR network architecture OR compliance regulations) but that’s all they know.
We have built a culture of specialists, when what we need are what I call “blended executives”: professionals with subject matter expertise both in a technology area and in a functional discipline or business process. But here’s the rub, companies are not growing these blended executives in any kind of consistent, programmatic way. Some companies, mostly very large ones, do have rotational programs that send IT people into other functional areas and “business people” into IT, and those programs typically work great. But the majority of companies, due to bureaucracy or culture or other priorities, do not.
The CIOs of these companies need to find creative approaches to growing blended executives, or the “IT and the business” paradox will never go away.
Marc Franciosa understands the need for blended executives. When he became CIO of Praxair, today a $12B industrial gases company, in 2010, both the business and the IT organization ran on a federated model with regional businesses making their own decisions about data centers, architecture, application development and IT strategy. “This approach let the regions be nimble, but it didn’t allow us to replicate processes and drive global change,” says Franciosa. “If we had a best practice in a region, it was difficult even to recognize it as a best practice let alone scale it to our other regional businesses.”
So, Franciosa “balanced” the regional vs. global focus and created globalized IT functions around strategy, architecture, infrastructure, application development and program management with regional resources to build relationships between IT and the regions -- and to manage local vendors.
The new organizational model made good sense for Praxair, but having taken the majority of IT resources out of the businesses, Franciosa ran the risk of having a “technology focused” team too disconnected from the businesses it supports. “When you’re always focused on technology, and your team is busy running operations and designing architectures, they are not learning about the business,” he says.
To address this, Franciosa knew he needed to develop blended executives who understood both IT and some major aspect of “the business.” Rather than build a formal rotational program, he looked for singular opportunities to cultivate a blended skillset.
Move a business function under IT
Franciosa had an IT leader who was very effective in one of Praxair’s largest regional businesses. He knew that this leader had the capacity to learn more about the business, especially finance, so he considered rotating her into finance and then bringing her back into IT. But he found a better strategy. “We actually moved our finance function (for this same large regional business) under her in IT,” he says, “Now, in addition to her work in IT, she is responsible for accounts payable, treasury, and tax for the regional businesses she knows so well.”
Franciosa admits that moving a finance function into the IT organization is out-of-the box, “But we now have an executive who has a deep understanding of two major areas of our business,” he says.
Bring business people into IT
Another example of “opportunistic blending” involved Praxair’s pricing team. “We’ve had someone in the pricing function who had been in the role for many years and had deep knowledge of how we priced all of our products and services,” he says. “He was not a technology person, and was comfortable with our legacy pricing systems, but he did not know our new ERP.”
So, Franciosa moved this pricing person into the IT organization where he is now leading the pricing work-stream for Praxair’s global ERP implementation. “In learning the new platform, he also learned a new way to do pricing,” says Franciosa. “His ERP work has made him much stronger in his functional area.” In addition, the ERP work allowed this executive to learn business functions beyond pricing including credit collections, product hierarchy, and more. “By moving this person from the business into IT, we have broadened his business knowledge and built out his technology acumen.”
Likewise, Franciosa moved someone with distribution expertise into the IT organization. “Our distribution expert knew all of the processes but he didn’t know the technology,” says Franciosa. “He is now in IT and has made a huge impact on automating the way we track cylinders, which is a major part of our business. And the best part is that he’s technology agnostic: If one business wants RFID, and another wants bar codes, he doesn’t care. He guides the group towards what is best for the process.”
Stick to your guns
When seizing on opportunities to develop blended executives, Franciosa has some advice: “People will tell you why it can’t be done,” he says. “They will tell you: ‘You can’t expect a business person to become a technologist.’ or ‘You’re going to take an IT person and teach them collections?’ You have to have a little bit of courage when making these changes.”
Moving business people into IT or IT people into the business has the obvious benefit of allowing you to grow blended executives. But according to Franciosa, there is an additional advantage. “All of these people now have a greater appreciation for the connection between IT and business processes and in the end are integral to driving business results,” he says. “And they can build great relationships as a result. They become advocates for the IT organization.”
And while IT continues to develop great credibility in its businesses, a little extra advocacy can’t hurt.
About Marc Franciosa and Praxair
Marc Franciosa was named vice president and chief information officer of Praxair, Inc. in 2010. He is responsible for global information technology services.
Franciosa joined Praxair in 2008 as director of global enterprise resource planning deployments in the Information Technology Services department. He was named director of business solutions in 2009. Before joining Praxair, Franciosa spent 14 years with the Linde Group of Germany and the former BOC. During that time, he held management positions of increasing responsibility in the U.S., South Africa, Australia and the United Kingdom. He managed the global information systems integration following the Linde/BOC merger. Prior to that, he was manager of information systems and materials resource planning for Armstrong International.
Franciosa holds a bachelor of science degree in mechanical engineering from Villanova University.
Praxair, Inc., a Fortune 250 company with 2013 sales of $12 billion, is the largest industrial gases company in North and South America and one of the largest worldwide. The company produces, sells and distributes atmospheric, process and specialty gases, and high-performance surface coatings. Praxair products, services and technologies are making our planet more productive by bringing efficiency and environmental benefits to a wide variety of industries, including aerospace, chemicals, food and beverage, electronics, energy, healthcare, manufacturing, metals and many others.