Week 3 Wrap-up: General IT Administrative Controls

Another great discussion full of good analysis and some great examples from the real world.  Those of you who work, please continue to bring such good examples to each of our discussions. You illustrate the learnings for all of us since we each have a different point of view.   I will give you my experiences, but that’s only one person who worked primarily in one company.  The more views we have the better.

IT organizations are usually the largest administrative expense in a company.  In manufacturing companies they may be only 1% or 2% of revenue but still be the most expensive support service.  In banks and trading companies IT can get to 50% of revenue.  For this reason the IT organization is a target for cost cutting.  It must be incredibly well run with all of its administrative processes very tight or it will constantly be second guessed.

Some CIO’s and business writers lament that CIO’s should have a greater say in the strategy of the company.  I agree with this outlook but would add that CIO’s need to prove themselves as well.  If my budgeting, procurement or HR practices are a mess why should the owners of the business trust my opinion about other matters.  It really goes beyond this.  If IT’s projects are not being done on time and on budget while producing value for the corporation, why trust IT.  It may be unfair, but by being big and expensive IT puts a spot light on itself and needs to act accordingly.

For much of my career I thought all the administrative controls were nonsense.  Only later did I come to see that they are the table stakes for playing in the game of business leadership.