January - 2003 - issue > Technology
The CIO Of Tumult
Karthik Sundaram
Wednesday, January 1, 2003
Dwivedi, nicknamed the “CIO of Tumult,” looks at his role as a change-leader in challenging times. “When the times are hard, innovation and sustained creativity are key to survival,” says Dwivedi. He should know. When he put forward a plan for the e-commerce project at ADC in late 1998 and was turned down, he had his team place plastic piggy banks at key spots in the executive area, with signs asking people to donate money for the e-commerce project. A few weeks later, he ended up with a few hundred thousand dollars—enough to start the project and deploy a prototype. “I launched a campaign to display my faith and passion in the vision of e-commerce, and it succeeded. You have to have a clear vision of where you want to take a system over the next three to five years. Then, you need to engage in selling that vision in a way that captures the imagination of the CEO and the CFO,” says Dwivedi. “Initiatives also have to be in sync with what business units need, and that means it's also important to manage sideways and downwards.”
Good going, indeed, for someone who went into his first retirement at the age of 35. “I thought it would be a good idea to write poetry, and meditate under the Bodhi tree (the Buddha was supposed to have gained enlightenment when he meditated under the Bodhi tree), which is a mile and half away from my house, in Bodh Gaya in Bihar,” laughs Dwivedi. “I thought I had had enough, after my stint at NovAtel, in Calgary, Canada, and went back to India, wanting to spend the rest of my life reading and writing poetry and Sanskrit texts. Six months later, I was back on a plane to Bedford, MA, to work for Prime/Computervision.” Since then, Dwivedi has been a CIO for three publicly held, large, global companies and has earned the industry's respect after spearheading ERP deployments thrice and a complete overhaul of their systems: all on time and within budget.
“When I joined ADC in 1997, the company was seeing a compounded annual growth rate of more than 40 percent through organic growth and through acquisitions as well. ADC, at the time, had several systems to perform similar business functions,” recalls Dwivedi. “Integrating people into the system looked far easier than integrating the systems themselves!” If ADC had not embarked on the ERP system deployment project, says Dwivedi, it would have been very difficult to attain the strategic objective of growth through acquisitions. “If a system project is well thought-out, it will definitely save a company money and help it attain its strategic objectives and operational agility,” declares the CIO.
In 2000, ADC's Global IT budget was approximately $70 million. "There is a wall, which has been created and is being perpetuated largely by IT media and consulting companies, between the IT and other business functions. Now, I cannot spend and invest $70 million per year on systems and not be called a “business.” Just like manufacturing, customer service, finance and HR, IT also exerts a direct influence on the business. It is all about business,” says Dwivedi. “ADC takes orders, builds products, ships orders and delivers customer services again and again and again. This does not change. An effective IT organization should help these processes and help the company grow in good times and prevent the business processes from breaking down in bad times.”
“Winning over the team's commitment is the key to system projects’ success,” cautions Dwivedi. “Unless the management is able to visualize revenue increase, cost reduction or customer-experience appreciation, you will not be able to sell them business-critical technology.” The smart Dwivedi uses different strategies to time his project-sell. “When I perceived the need for our sales team to be set free from the “hole-in-the-wall,” wired access to our global network, ADC did not have the capital budget for a wireless project. But I worked out a plan with our network director. We signed on a new service provider for our corporate wireless needs and negotiated a 30% annual reduction in our wireless phone bills. I was able to get the program, nicknamed “program Mobilize,” deployed, give the network director funds for another new project, and also send some money back to the treasury,” claims the proud Dwivedi. “All this cannot happen if you don't have the team fired up with the dream and aligned with your vision.”
An ROI-based justification of a system project is very important. However, at the same time, it is difficult, if not impossible, to accurately and convincingly estimate return on most system projects. In such a context, Dwivedi says, the goal should be to minimize the denominator—the investment component of the return on investment—understanding that whatever the return is, a lower denominator will always produce a higher ROI. The CIO also underlines the importance of getting a management buy-in on a system project before any budget planning begins. “For a CIO, it is very important to build trust and nurture it with the CEO/CFO duo and other members of the senior management team. Once there is a professionally workable evidence of a solid trust among various stakeholders, it makes the selling task easier. However, the trust must never be misused,” Dwivedi warns, “Once you lose it, it is gone, if not for ever, for a long time to come.”
How is Dwivedi able to accomplish all this, despite big budget cuts in his IT expenditure? “We're working hard to reduce costs and become a more cost efficient operation so we can be prepared for the upswing when it happens,” Dwivedi says. “Any system vendor who comes to my office is warned to be prepared for hard and long negotiations. While buying, I have the infinite patience of an Indian.” ADC has partnered with several small vendors. “Nowadays, even a large company may not exist tomorrow,” quips Dwivedi. “We have been partnering with smaller companies, and are spending smaller amounts, so that our risks are minimized.”
Dwivedi can be mistaken as a champion of the underdog, because he strongly believes in the customer service commitment that a small system vendor or an IT service provider brings to the table. “The large consulting companies are like airlines. They overbook projects and you are left on the lounge, waiting for the next aircraft,” says the ADC CIO. “In my experience, the smaller companies appear to be very customer-oriented. They deliver very good quality in tight time frames, and this relationship has been very productive.” Dwivedi also sits on the board of ADC India Ltd. “The Bangalore office is small today, but we are ramping up our presence over the coming years and hope to make this offshore unit an integral part of the business. The 12-hour time difference makes it a distinct advantage to have an office in Bangalore, which starts working just when we are closing,” says Dwivedi.
With Microsoft acquiring North Dakota-based Great Plains Software, Dwivedi says his crystal ball tells him that in five to ten years, Microsoft will emerge a big player in the ERP space. It is a highly likely scenario that by 2010 there might be another ERP changeover similar to the one seen in the early 90's, predicts Dwivedi. Microsoft's publicly announced investment of $300M in India should be seen in this light. As the high technology and telecom industries recover from the most recent downturn, Dwivedi predicts another evolution in the role of the CIO. “Many say that the half life of a CIO is 18 months. I have been here for more than that and, in this business, for over a decade and my half life keeps moving away,” laughs Dwivedi.
With the IT organization closely aligned with other parts of the company, the ADC CIO feels that the CIO role will grow to include active participation in corporate efficiency programs, strategizing supply chain system environment and adding more tools to the Sales and Marketing organization's tool-kit.
A CIO should not fall in love with a particular technology, warns Dwivedi. Technology is only the means to the goal and the goal is to grow the business and to make money. With the telecom industry coming close to a point of stabilization, Dwivedi says that an effective CIO's role in this space would only get more challenging and not threatened. “If you have won the senior management's trust and do not misuse it and clearly communicate the system vision of tomorrow and are able to deliver enhanced value to the shareholders, then there should be no room for a strategy driven by paranoia,” asserts Dwivedi.
