I, too, am excited about the opportunities of a global economy, but I'm also concerned that executives are in danger of woefully underestimating what it takes to build a truly global IT presence. Consider the following examples:
-- A multibillion-dollar consumer packaged goods firm has standardized on SAP for ERP, but because of a lack of consistency in business processes across the organization, it has been unable to implement a single instance outside the U.S. As a result, it is not getting the maximum value out of this significant IT investment.
-- Google recently announced that it will set up a new site for the Chinese market. It will censor itself to satisfy Chinese government authorities.
-- A CIO at a manufacturing firm laments that countries outside of the U.S. have pushed back on some corporate technology standards, claiming that these technologies are too costly for emerging markets.
I could go on, but you get the point: Doing global IT is a lot harder than it looks. Today, I run into lots of CIOs at companies that operate around the world, but almost none has a truly global IT organization. Almost none has a standard set of IT services that is consistent everywhere. Almost none has a centralized mechanism for managing risk, compliance and regulatory matters. Almost none has an enterprise architecture that stretches across continents. Almost none has a central resource-management capability that allows human capital to be managed and leveraged optimally across the globe.
Will IT ever be global? One could argue that IT will never be centrally managed around the world. Language and currency issues mean some applications may have to be swapped out in unsupported geographies. The unavailability of infrastructure will also impede some efforts to deploy standard technology everywhere. Finally, some might argue that it's not desirable to run a global IT function from a central location. The cultural issues alone suggest that it may be best to keep IT closer to the local business units.
Still, the notion of having a CIO (and a supporting group of IT professionals) on every continent seems to be a model that's headed for extinction. It's too costly -- both in terms of well-paid professionals and in terms of the duplication and conflicts that it causes. So, let's assume that establishing a fairly centralized, global model is what large organizations will want to do. Here are the issues they are going to confront and what they can do about them:
The battle for control. If you are in a multinational company that currently has several CIOs (or a country-specific IT function), who is best positioned to lead your IT organization? Usually, the CIO at headquarters has a big advantage politically, but he isn't always the right choice. Once the leadership is decided upon, however, there will still be IT people in far-flung places, and these people may not be highly motivated to support the global CIO. It's essential that performance metrics be closely linked to cooperation with global IT management, or else there's a good chance that cooperation won't happen.
Technology challenges. As I mentioned above, there will always be exceptions to global technology standards. To the extent that the organization can standardize its core systems, however, it will move a long way toward a global model.
The cultural issues. We all know that working with individuals from other cultures is a challenge. These issues are magnified when there are multiple locations involved. Selecting a global IT leader who is a strong communicator is a must. Choosing someone who has worked in several areas of the world would also be advantageous.
The geopolitical issues. As the Google example illustrates, there are myriad issues that will affect the deployment of technology globally. Organizations will need to develop a competency within IT to evaluate the risks and opportunities of expanding into certain geographies.
Building a global IT function is fraught with challenges. It will be essential, however, if organizations expect to capitalize on the wealth of business opportunities around the world.
Barbara Gomolski, a former Computerworld reporter, is a vice president at Gartner Inc., where she focuses on IT financial management. Contact her at barbgomolski@yahoo.com.