CIO Hall of Fame: Paul A. Strassmann

 Career Highlights

Certainly more than any other CIO on this list, Paul Strassmann invites controversy. His aggressive critiques of conventional notions of IT payoff, and statements like, “there’s no correlation between IT and profitability,” tick a lot of people off. “Paul has consistently challenged the sometimes unsubstantiated hype in this industry, particularly in areas of productivity,” says James Sutter, vice president and general manager of Rockwell Information Systems, who worked for Strassmann at Xerox. “People with favorite ideas and projects would find him challenging them, and that’s made him unpopular in some cases.”

Strassmann’s actions as IS chief at Xerox and later the Department of Defense, along with his books, have hammered home his assertion that one cannot prove the value of technology using the size of the IT budget or any other technical metric. Only business measurements–tied right to shareholder value–can prove IT’s worth. By and large, CIOs have heard Strassmann’s call over the past 10 years, and now even most trade magazines don’t judge the excellence of an IT department by how much it spends. But Strassmann knows his message hasn’t reached everyone. “Sometimes I’m not even sure my wife hears me,” he says.

Indeed, Strassmann’s Value of IT model, which links IT to specific business value, sometimes sails over the heads of his audience. “His model and writings do not always get acceptance–even from the financial area of the firm,” says James R. Kinney, vice president and CIO at Kraft Foods and president of the Society for Information Management International. “A Fortune 50 company tried to use his material and, though their CFO accepted it, general management was befuddled. I think one of the reasons is that general managers are not always that well versed in the economic structure of the firm to begin with.”

Despite his emphasis on business economics, it’s the nonprofit public sector that is the setting for Strassmann’s most gratifying contribution. “When I got to the Pentagon, I basically had a checkbook from the secretary [of defense], so all of the people in the DOD came to me in the first week to make presentations for their projects,” Strassmann recalls. “They had more flip charts and more books and more slides than I could ever possibly see. So I had some hotshot guys program Chapters 9 and 10 from my 1990 book, which defined how to do business value assessment.” Strassmann told the DOD supplicants to run their numbers through the program, then come back and talk. As one might expect, this thinned their ranks considerably.

The program eventually was published on CD-ROM, and 11,000 copies were distributed throughout the federal government, earning recognition from Vice President Gore’s Reinventing Government group. Last year, a civilian version was produced. Quips Strassmann, “Now you’ve got Strassmann in a can.”

Chris Hoenig, director of the information management and technology issues of the U.S. General Accounting Office, views Strassmann as a pioneer in the public sector. “Paul was influential because he tried to create serious change by applying leading practices from the private sector to government,” Hoenig says. “He tried to set a new standard, and we really learned a lot from his courageous efforts.”