What's Next

Business owners tend to either love or hate their information-technology departments, but they generally don't know why. And if they think that they have good reasons, either way, they might easily be wrong. The truth is that entrepreneurs typically don't know how to even think about IT, much less whether their IT department is helping their business. That makes it very difficult for most companies to manage IT, with the result that there aren't very many good IT departments. But it doesn't have to be that way. If we understand the way IT people actually think and then the way they ought to think, it's possible to save money and at the same time make IT really pull its weight.

That process is a little easier than it used to be, thanks to the current recession, which has cost 400,000 IT jobs to date and made the hiring picture go from absolutely insane to merely competitive. During the Internet bubble we hired anyone who knew certain IT buzzwords. Now we can at least require that someone be able to put those buzzwords into a coherent sentence.

Coherence is not a joke here, since many IT departments are staffed by people who weren't born in the United States. IT staffs are filled with Chinese, East Indians, Koreans, Russians, and the occasional guy from Memphis, all with varying English-language skills. A friend of mine who used to run an Internet company in suburban Washington, D.C., recalls interviewing an IT candidate who kept using the word access in his interview. "I couldn't tell whether he was talking about Microsoft Access [a software product] or the Dulles Access Road," she says. "My IT director, who was also at the interview, said he thought the guy was talking about using Microsoft Access on the Dulles Access Road, but he wasn't completely sure about that."

The candidate got the job.

So the first rule of having a good IT department is that you have to be able to communicate with that department. That doesn't mean avoiding foreign-born help. It means making sure that someone in the department speaks fluent English and can act as a liaison.

Communication is so important because IT people aren't like you and me. They tend to be nerdy and headstrong and often reluctant to communicate at all, much less well. They can appear to be busy and focused, yet the path they're following may or may not be the one you think you have set them on. If they don't agree with you -- and often they won't -- they'll just do it their way without saying anything.


When it comes to making IT pay, products are bad, projects are good. Think in terms of solving a problem, not buying stuff.

That doesn't make sense, but then IT isn't really a profession, and most of the people in it landed there recently. Maybe they were computer users who knew a little more or cared a little more, and so they strayed into IT. Maybe they actually have engineering credentials, but what they really are is people who play around with computers all day. And whatever their backgrounds are, sitting at your help desk was not what they expected to be doing with their lives.

The way to get around communication problems is to put the focus on your business rather than on who's right. Make sure everyone understands what your business is and how IT is expected to help make that business successful. That's almost never done, probably because owners and managers themselves often don't know the proper role of IT in their enterprise.

What IT services does your company need in order to operate? Don't answer that question with any IT products or names. If you started to say "I need laptops for all my employees," then you missed the point. What do your employees need to do their jobs well?

They need information, which is why we call it information technology.

IT is an overhead expense just like phone service or electricity. And like those basic tools, IT is a business enabler -- or is supposed to be. IT manages the information that's needed to operate a business. Your IT director might think his or her job is to provide reliable E-mail service, when actually it's to provide communication services that make your business more efficient. But if that isn't said aloud often and isn't repeated at all levels of the IT organization, the IT people simply won't come up with it on their own.

Most companies increase their market share through lower prices and good service. Keeping your service levels up and aggressively cutting costs is the key. That's where IT can provide the greatest value to a company. No computer application in existence can improve your service level and cut costs. This is a manual process done by you and your employees. Basic (usually uninteresting) business applications provide the data. The data allow you to find cost-saving opportunities and provide a means to measure your progress. Improving a business is a continuous process, something done constantly year after year. IT's job is to provide the data in a useful format and make the data readily accessible to anyone with initiative. You think that's obvious? It isn't to your IT department, which tends to see itself as helping users (or fighting with them) rather than helping the enterprise.

How do you know if your IT department is doing well or not? The most commonly used measures are budget and user satisfaction. Those generally don't gauge at all how well the IT department is fulfilling its mission.

Start with user satisfaction. Is the IT department popular with users because their database access is good or because their pornography loads in an instant? Are the IT guys focused on your company's goals or on the goals of their friends in the company? Too many IT resources go into helping users play Doom faster. A good IT department keeps in mind the objectives of the business, not those of the users, because the two are not always in alignment.

Evaluating an IT budget is trickier. The boss can't train himself as a programmer. But he can ask some simple questions. "How is this purchase furthering the business goals of our organization?" is easy to ask, and once the nerds get used to answering it, it will become part of the culture. "Do we really need this function, and why?" are two other questions whose answers a boss can pretty easily evaluate. "If I gave you only half the money you asked for, what would you do with it and how would our performance vary?" is a really good one. Many bosses might be surprised to learn that half the money can buy 90% of what they want (or sometimes 200% if it leads to a better vendor or a different approach).

When it comes to making IT pay its way, products are bad, projects are good. Think in terms of solving a problem, not simply buying stuff. Plans should be written around the purpose of the project, not the product that will be used. What's the difference between an E-mail-upgrade project and a Microsoft Exchange project? The E-mail-upgrade project is about finding a way to give the company what it needs, whereas the Exchange project is about getting another Microsoft program in place and teaching the company to live with it.

That leads us to another sorry IT reality. Most IT knowledge comes from the vendors. Hardware and software salespeople are in most cases the teachers. Their case studies and white papers become the business justification for your IT projects. Their certification programs not only teach people how to use products but also indoctrinate IT staff people as internal sales reps. That is not good. We need the training, not just the sales training.

If your Microsoft Exchange project fails, whose fault is it? Usually, it's Microsoft's fault or the consultant's or the contractor's. Is it ever the IT department's fault? Why would a Microsoft Exchange project fail? Usually, it's because your IT department doesn't know what it's doing. IT gets a lot of mileage out of plausible deniability. Succumbing to vendor mind control does not define what it means to be a good IT-department head.

So communication and clarity of purpose are key to having a successful IT department. Not only do they help the company, but they help the morale of the IT people themselves. They finally have a sense of just why they're mining all that salt and what the salt will be used for.

But even the best communication and the best hiring and saying the same IT mantra together won't do any good if the CEO doesn't share those same values and knowledge. Discipline has to start at the top.

I worked years ago at a great big company we've all heard of, and one day the CEO dropped by for a "town hall" meeting. It was one of those meetings after which you seriously question your career path. He was clueless, or in denial, or simply didn't care to know the facts. He had no idea how business was being done at our company. He didn't know that the outdated order-entry and billing system could not meet our business needs. He didn't know that the financial-approval system was bringing us dangerously close to violating our contracts with customers. He didn't know that the purchasing system had the potential to shut down a factory or cause the company to miss important commitments. He basically had no idea how our business worked.

When leaders are clueless about the operation of their company, how can they have the vision to direct IT investments to make the company more productive, more competitive, more successful? They can't.


Contributor Robert X. Cringely is a writer, broadcaster, and entrepreneur specializing in technology.


Please E-mail your comments to editors@inc.com.