How to Launch a Leader

Instil leadership skills and business sense in your IT employees - and watch them soar.

Reader ROI

• Why companies tend to skimp on leadership training for IT staff
• What a few pioneering CIOs have done to encourage leadership skills development
• what IT staffers have learned from their leadership training

At ING US Financial Services, Irene Heege serves side by side with four business leaders on a team that guides one of the company's five major business lines. Heege represents IT in this group, but she's not, as you might expect, the CIO. She is head of worksite application services - a techie. Heege has the credibility, the skills and the authority to help make million-dollar decisions because of her on-the-job experience and ING's emphasis on leadership development.

An example of that leadership development focus is ING's Talent Review Initiative. Participants - generally the top 2 per cent of the IT staff in skill levels and accomplishment - receive extra training, both onsite and offsite, and become candidates for ING's business school program in Amsterdam, the Netherlands (the home of parent company ING Group). There, employees might take courses in banking, insurance and leadership, get coached in management skills and be assigned mentors. The program is meant to serve ultimately as a stepping-stone to senior management.

Intensive leadership training like this is the exception rather than the rule among corporate IT departments. Identifying candidates, creating leadership programs and administering them was a daunting challenge during the hectic days of rapid growth, and still is in today's overworked and undermanned environment. But companies as diverse as ING, trucking giant Schneider National and IT services company Unisys, recognise that growing and moulding future IT executives is critical to the long-term success of their organisations.

These companies teach their IT staffs communication skills, help them understand the business and instil a culture grounded in values. They identify high-potential people early in their careers and put them on separate development tracks, making sure they build leadership and people management skills through training, coaching, mentoring and working with business peers (skills far different from those they'll acquire in the latest SQL Server or XML-coding course). And most important, their CIOs have made a commitment to developing and nurturing their successors.

ING's Talent Review Initiative was created to fill a gap, says CIO and executive vice president Paul Donovan - one that he believes is still prevalent in the world of IT. "Identifying the high-potential people and those that will make great managers and leaders is not something IT has done a good job at," he says. "People are picked without a lot of training to fill a void. You give them a shot; what you haven't done is prepared them for this new role. They've gone from writing a program or fixing a problem [to managing people], and it's a very different role."

Randy Mott, the CIO at Dell, attributes part of the problem to the fact that IT is still toddling around in nappies, relatively speaking. "The issue starts with how companies perceive their IT organisations," he says. "With the function being relatively young as an industry, most companies view the CIO as the single source for decision making and strategy development, so the second tier of IT leadership doesn't always get the exposure necessary to develop their leadership skills."

The end result for many IT departments: managerial ranks chock-full of people who are highly qualified technology specialists but underqualified motivators and leaders of people. IT staff notice this and resent it.

In a 10-person IT department, that may not matter. In a 100- or 1000-person staff, a lack of leaders can put a major hurt on efforts to weave technology into the business. Today, IT managers need to work side by side with their business counterparts and be able to communicate in the language of ROI and customer satisfaction, not just the techno-speak flung around in the server room. They must understand underlying business processes and be able to suggest improvements. They need to help make the business cases for new IT projects and convince executives of their merits.

Here's another reason to make sure you're growing future leaders: Though the staffing crunch of the late 90s may seem as distant as the dream of bug-free software, at some point the lid on spending will come off and more projects will get the green light. As soon as that happens, your most valuable employees will begin sniffing the air for new opportunities. To keep your people happy - and in their seats - you must allow the future managers, directors and CIOs to gain the same core leadership skills that paved the way for your entrance into the boardroom.

Page Break

Get on the Leadership Track

At Schneider National, home of the vivid orange 18-wheelers that traverse US highways daily, the 425-person IT department is divided into two tracks. One is technical: Employees choosing this career path take on roles and responsibilities that require technical competency in areas such as operating systems and product development. Those folks - the hard-core techies who find pleasure (and pain) in the nodes, nooks and crannies of networks - manage machines but, by choice, no people. The other track is managerial: IT staffers who choose this path desire a career that, in addition to developing their technology chops, gives them the opportunity to manage others. "We allow people to see where they want to go," says CIO Steve Matheys. "If they want to be a leader of people, we focus their career on management and people attributes rather than Java programming skills." Currently, 88 per cent of his IT staffers are pursuing the technical track; the other 12 per cent are the department's future managers.

Tom Moule is climbing the rungs of Schneider's managerial ladder. He joined the IT staff six years ago as a lead technical staffer, just as the dual-track structure was being put into place. "I was focused on projects. I said to my manager: '[Managing people] is what I'm interested in.' Roughly six months later an opportunity came up to lead a team," he says. His career has been marked by increasing responsibility: In his first year, he managed a team of eight; now, as director of application development, he manages more than 90 full-timers and about 60 contractors. He also co-chairs (along with an exec from the business side) the Transportation Steering Committee, which approves and tracks the company's transportation business unit projects - a nod to the fact that at Schneider, IT leaders are most certainly business leaders.

Of all the tasks Moule has taken on in his leadership development, he cites several presentations he's given as key learning experiences. He spoke at a Balanced Scorecard conference and at a conference sponsored by the Research Board, and he has also made presentations to Schneider's CIO, CEO and IT executives. He says the discipline of gathering information and communicating it well to an audience has been an education in itself, bolstered by coaching from various IT leaders on how to improve his technique. "Plus feedback when I've done a good job," he adds. Sometimes a pat on the back can be just as important as a "here's how you could have done this better" lecture.

Moule lists several other important benefits from the company's leadership training. They include critical-thinking skills ("being able to ask the right questions," he says); synthesising the data he receives daily to make decisions without suffering from "analysis paralysis"; and understanding the individual skills and strengths of the people he manages and "realising that you can't manage everyone the same way". He lists one more outcome of his management-track training: "The confidence my leadership has shown in me to give me additional responsibility and the support I need in that role, but not to micromanage me." Birds gotta fly, after all.

It should be clear to all CIOs by now that the age-old practice of promoting techies to management positions - people who would be much happier ensconced in the server room - does not bode well for the future of your IT department. "You have to realise that the IT job is not just a technical job. It's really about a third business acumen, a third technical skills and a third leadership," says Dell's Mott. "The first thing you have to do is change IT's mind-set away from thinking, The only thing I have to worry about is having technical skills. How you work with business partners and understand the business you're in takes technical skills and leadership skills. One common mistake, in my opinion, is [IT departments] don't focus on leadership until someone's been in IT a long time, 10-plus years. It's too late at that point."

In early 2002, Mott held a two-day summit called the Leadership Imperative with around 200 of his IT managers (that is, all those who manage people). Dell President and COO Kevin Rollins helped introduce the new philosophy to the IT team (the program was also rolled out in Dell's other business units). The event's main purpose was to get the managers thinking about why leadership is so important and to help them develop their people skills. This year's leadership program, called Developing Champions, was launched in January. All IT managers around the globe will complete the program by January 2004. Developing Champions focuses on building better relationships with internal business partners and gaining financial acumen around company metrics.

Page Break

People Skills and Technology - a Dynamic Duo

Denene Coyle, Unisys's director of global training and development, has spent 30 years at the technology services company, carving out a dual role in the IT and finance departments. On the techy side, Coyle handles training activities for the company's internal ERP system. She also serves on seven organisational excellence teams and develops IT training curricula. On the finance side, Coyle provides curriculum advice for the IT finance and procurement courses at Unisys University, the company's in-house training program. How did this unique position come about? "I wrote a white paper that created this job," she says, matter-of-factly. She reports to the CFO, Janet Haugen, but both Haugen and CIO John Carrow give her performance reviews.

Coyle highlights the organisational excellence teams as particularly important in developing leadership skills. Carrow adapted the concept from his days at GE and the city of Philadelphia, and brought it to Unisys about four years ago. The idea behind the teams is to get IT workers involved in meaty organisational issues that go beyond technical concerns. So, for example, teams have formed around how to assimilate employees better into the company, how to communicate better, how to improve skills and how to get better at identifying employees' areas of expertise. About 15 to 20 volunteers join each team. "The [organisational excellence] teams helped us identify key leaders [via seeing] who became the natural leaders of teams," says Carrow, who heads a staff of 850. "There was a high degree of correlation with the talent review process in the company."

For Coyle, the benefits of working on those teams go beyond the specific subject matter. Because the teams are voluntary and don't have a big stick to wave to "cajole" others in the company, Coyle has learned collaboration and influence skills. "You're a motivator and cheerleader and someone who needs to communicate well to get people on board," she says.

Coyle is a big believer in participating in the more informal activities that a large company offers - both for altruistic ends and for the leadership opportunities that those activities present. "When I talk to people about leadership and career advancement, I always talk about the non-traditional activities, things outside of your job," she says. She chairs the Unisys professional women's forum (which helps develop women's careers) and heads one of the three teams that compose the company's North American diversity council. "At Unisys, being able to matrix-manage [that is, manage people and projects that don't report to you] across a variety of organisations is key. Those are difficult skills to hone. Through some of the activities I've been involved in, I've been able to practise those skills. The higher up you go, you have to be able to influence people, to collaborate. You have to convince people that what you're recommending is the right thing. You have to learn how to influence without the strong hammer of having them report to you," Coyle says.

Not to be overlooked are the networking prospects these activities offer. "You meet people you'd never meet in your traditional role, and that allows you to have opportunities in areas of companies you wouldn't normally have," she says. Coyle makes a good point - slapping backs, shaking hands and trading war stories with leaders in other IT or business units can add a little turbo boost to one's journey up the corporate hierarchy. Meeting people outside company walls has been valuable to Coyle. "That grounds you in making sure you clearly understand the company's positioning in the marketplace and what customers think is important," she says.

Ultimately, one of the most important goals in leadership development has to be growing and nurturing people skills, the human qualities necessary to lead. That's an aspect often overlooked. Often, people's leadership qualities are judged strictly on how good they are at getting results - achieving the goals of their business units, for example. But believing that making your numbers makes you a good leader is like saying that playing a mean clarinet turns you into a great bandleader. Great leaders possess the whole package; they get results and know how to motivate and get the best from people.

Leadership author Terry Pearce says that execs who want to be more effective leaders should observe four principles: understanding what your values are, creating the courage to speak about your values, developing the necessary emotional intelligence to lead and learning how to connect with people at the limbic level (that is, through emotion and motivation). Pearce, who wrote Leading Out Loud and founded the consultancy Leadership Communication, recommends that his clients get 360-degree feedback on their leadership performance from their bosses, peers and the people they manage.

The results can be surprising. One exec he worked with at Charles Schwab several years ago, Pearce says, "was the most dynamic, smartest person I'd ever met, but he intimidated the hell out of people". When the exec's direct reports gave him performance assessments, the feedback was exactly what Pearce expected: He was competent, but people hated to be around him. The exec couldn't change his behaviour, however, and ended up leaving Schwab.

Page Break

Taking Care of Business

As befits someone who's absorbed a great deal of management know-how while ascending the IT ranks, ING's Heege can rattle off a list of competencies necessary for leadership. "It's about being able to create a vision, build a high-performing team, make sure the right talent is in the right position, execute, challenge the status quo to ensure we're creating fresh thinking and relationship management skills - building relationships with our business partners," she says.

Business relationship management, as Heege calls it, is a critical component of the well-rounded IT leader. "The way to build strong relationships is to really know the business, talk the business language, and, as the technology needs are expressed [by the business], you come back and deliver solutions," she says. But to deliver solutions, she emphasises that potential IT leaders had better know technology well enough to be able to show the business how it can meet its needs in different ways, thereby increasing business value.

Heege has built an affinity for the business side through several affiliations: project management training at Boston University, a women's leadership council at a previous job and an internal leadership council at ING US (headed by CEO Tom McInerney). Her role on ING's Defined Contributions Market team, which was formed in November 2002, is both her reward for business knowledge and a high-level training ground. "To have respect on the team, you need to know the business, have passion for the business and have the desire for the business to succeed," she says.

Harrah's Entertainment builds business expertise among IT staffers through its Executive Associate program, which pairs potential leaders with senior executives in the company for about 18 months. Executive Associates are given special projects to help them grow as leaders. Sometimes they even vault the IT wall: Tim Stanley, CIO of Harrah's Entertainment, notes that one IT staffer worked for the COO, then was promoted to vice president of strategic sourcing.

For hospitality companies like Royal Caribbean, it all comes down to taking care of people. So CIO Tom Murphy has come up with an innovative way of targeting future IT leaders - he sees which folks shine brightest in the company's community service initiatives. The company's annual Give Day event requires some people to coordinate projects with a number of non-profit organisations. "It's the single largest one-company community service event in Florida," Murphy proudly notes. "We observe who shows an aptitude for leadership on those projects. Those people tend to get a little bit more opportunities. They're actively engaged in the culture of the organisation, taking on additional responsibilities. Passion is an important part of effective leadership," he adds.

Are you passionate about developing leaders? If not, now's a good time to get on board. Maintaining the status quo will guarantee you and your crew sure passage to mediocrity.

Page Break

SIDEBAR: Fighting an Entrenched Culture

A Coast Guard commander finds that developing IT leaders can be a titanic struggle

Captain Robert Day, division chief for the United States Coast Guard Pacific Area, recognises that his IT organisation, which numbers 265 people, has a serious gap in leadership development. Unfortunately, he has found it to be a difficult fix.

The deep-rooted culture of the Coast Guard has always favoured generalists for promotion to leadership positions. "Since the Coast Guard's real mission is flying planes and saving lives, IT specialists were not readily looked upon as guys who'd be promoted to admirals and commandants," says Day, who is in charge of command, control, communications, computers and information at the Coast Guard in Alameda, California. "There wasn't a direct tie of the work they did to the operational side of the business that the public sees. Consequently, we've had a lot of problems with retention." He estimates that from 1996 through 2000, about half of the folks with the most leadership potential left for the public or private sectors, frustrated by the lack of upward movement and no formalised leadership program.

Though it will take a boatload of time for IT specialists to break through the cultural barriers and be viewed through the same lens as their cutter- and aeroplane-piloting brethren, Day feels things are moving in the right direction. "The biggest thing has been the circling of wagons of senior IT leadership for mentoring these guys and at the same time fighting the case with senior [Coast Guard] leadership of letting the business guys know in business terms what these [IT] guys can do," he says. Day is also excited about last year's appointment of Clifford Pearson as CIO. Pearson is the first CIO since the Coast Guard created the position seven years ago who has a predominantly IT background. "We're seeing the impact of that decision already," he says. "There's a much tighter focus on the entire IT program, and alignment with key business is even closer."

SIDEBAR: CIOs on Leadership Development

CIOs cite some of the things they've learned over the years for developing leadership in their IT staffs

START EARLY Randy Mott, CIO, Dell

CIOs need to develop their employees' business and leadership skills right out of college, not 10 years down the road. Also, IT leaders should move staffers to new areas regularly so that they are challenged and energised. "I've been guilty of not rotating people in the past," he admits.

STUDY CHEMISTRY Steve Matheys, CIO, Schneider National

Underestimating the chemistry of a team can be critical. "So when thinking about building talent, you have to find talented individuals [who are] capable of working well on teams."

MIND YOUR MENTORING Tim Stanley, CIO, Harrah's Entertainment

If you're going to implement a mentoring program, you'd better do it well. Stanley began one for IT junior staffers about a year and a half ago, but it's now on hold. "We didn't think we had a system in place to make it work well or the time for the mentor and mentee built in or the best approach to selecting people."

R-E-S-P-E-C-T Wei-Tih Cheng, CIO, Aetna

Treat your staff with dignity. "I believe the fundamental Golden Rule applies very well to leadership training: Do unto others as you would have others do unto you."

SEEK OUT AND CHALLENGE Paul Donovan, CIO, ING US

Institute a method of identifying high-potential leaders. "Those leaders typically will be leaders someplace else - if they're not being challenged here, then there's the potential to lose them to another company."

PUSH THE ENVELOPE - WITH DIPLOMACY John Carrow, CIO, Unisys

"I think the major lesson is to stretch people beyond what they think they can do and take some risk in terms of what you allow them to do. Give them the opportunity to make a mistake." Carrow also preaches caution when identifying future leaders. "There are obviously a lot more not identified, so you have to be careful you don't disrupt the rest of the workforce."

Page Break

SIDEBAR: Performance Reviews Matter

Companies continue to rely on performance reviews and courses in communication and business principles to identify and develop employees with leadership potential.

REVIEWS Performance reviews are integral to giving employees feedback as well as helping them develop their careers. At Royal Caribbean, one or even two reviews a year doesn't cut the mustard; CIO Tom Murphy and his managers do quarterly reviews, and employees have both a professional and a personal development plan, which complement each other.

Harrah's Entertainment takes a three-pronged approach to the review process. First, managers administer biannual performance reviews. Second, workers sit down with supervisors to outline and track their training plans and their career development using People3's IT-HR application. At that point, people are given a chance to identify their wants - say, the opportunity to attend a technical conference - and supervisors also record what projects they have worked on. That allows resource managers to look at the app and say: "This would be a good project for Joe or Mary to work on." The third element involves an annual talent review and succession planning exercise in which IT senior executives look at all 500 or so of Harrah's IT employees to identify the strongest performers and plot out succession plans. The succession plans are recorded in a specialised succession planning system used by the company as a whole.

COURSES Offering courses, whether classroom or online, gives IT executives another way to help their employees grow professionally as leaders. At Schneider National, most courses are open to all 425 IT employees. Entry-level classes include communicating effectively, writing for effective messaging and reading a financial statement. Advanced classes cover topics such as concepts of leadership, the role of leaders and change management.

All Aboard: Royal Caribbean's Lead IT Program

Two IT managers, taking a cue from their leadership-evangelising CIO, launch a grassroots program that brings leadership skills to the entire IT staff

Fired up after a two-day leadership seminar last year run by author and leadership consultant Terry Pearce, Greg Martin, manager of client/server and messaging solutions at Royal Caribbean, was inspired to act. His colleague, Geoff Lawson, an IT manager, says: "It was evident Greg had a lot of passion around leadership development. He recognised the need and desire for a grassroots leadership development program."

Martin developed the concept and presented it to CIO Tom Murphy, his direct reports and eventually the IT management team, which gave it the thumbs-up. The Lead IT program launched last November. According to the flier announcing the new program, Lead IT "prepares Royal Caribbean IT for the future by making sure that the people who will lead us have the vision and skills needed to succeed".

Martin and Lawson act as co-facilitators and serve on the steering committee, which includes an IT vice president. There are currently 40 to 45 people involved in the program, which holds half-day sessions every six to eight weeks. The only criteria for joining the program are that people agree to attend on a regular basis and participate. "We didn't want it to be elitist - people handpicked by upper management," says Lawson. "We wanted it to be inclusive."

The main goals of the program are to build trust and open relationships across different departments within IT and to establish a learning culture where people can share ideas in a supportive environment. "A common thread when we ask people what they want to get out of it isn't people saying, I want to be a director next month; they say, I want to speak better in public. [This provides] a safe place among their peers to practise," says Lawson.

This year, the company has held three sessions. For one, participants read and discussed First, Break All the Rules: What the World's Greatest Managers Do Differently, by Marcus Buckingham and Curt Coffman; in another, they discussed The Innovator's Dilemma: When New Technologies Cause Great Firms to Fail, by Clayton Christensen. The group has also hosted guest speakers, such as Murphy and Miami-Dade County Mayor Alex Penelas. Other activities have included group members presenting profiles of leadership (Winston Churchill and Rudy Giuliani are two that have been discussed) and discussions of communication and presentation skills and diversity. But the better part of each session involves interaction among the participants. Martin says: "Ninety per cent of the program is people sharing their experiences."

The feedback has been positive so far. "People are using it as a baseline to go back to their team and see how they can improve," says Martin.

Page Break

SIDEBAR: Management To-Do List

Here are some action items for CIOs - taken from experts, IT staffers and CIOs themselves - to make you a better manager

• Get in front of your staff on a regular basis. Ask for questions and concerns. Solicit ideas. Then listen. And respond with the truth.

• Get to know your direct reports. Find out what makes them successful as individuals.

• Put together a team to collect employee ideas and input on a monthly or regular basis. Employees resent not being able to contribute. Install a suggestion box if you don't already have one.

• Invest in professional development for your staff. "You absolutely must preserve some of your training money. You have to send them to training at least twice a year or they'll leave the first chance they get," says Beverly Lieberman, president of executive search firm Halbrecht Lieberman Associates. But don't dole out training opportunities to only the choice few, as sometimes happens when money is tight. That will just create worse morale among the have-nots.

• Remove the obstacles to getting training. With people spread so thin, it can be difficult, if not impossible, for them to take advantage of training. Use creative scheduling or get in some temporary help to ensure people can take courses.

• Have senior management speak to your group about the business and its goals. "Even if there's nothing really great to say, you have to tell them how you're trying to keep the ship afloat," says Lieberman. Put a cap on negative water cooler chat by formalising the discussion.

• Enlist help from human resources. Spend time with a senior HR person and brainstorm ways to bolster morale.

• Go for executive training. This may be impractical with both time and money tight. But if there's any way you can do it, take an executive development course at a premier institution such as the Australian Graduate School of Management.

• Get yourself a coach. Ask an HR professional to help you find a personal coach who can help boost morale. If the company can't or won't sponsor coaching services, pay for it yourself.

• Get communication help. Cecil Smith, CIO of Duke Energy, has a dedicated communication professional, Andy Thompson, to help him disseminate information both inside and outside his organisation. Smith was surprised to hear there was an IT communication role when he first joined Duke in 1995. Now he finds Thompson indispensable. "He's been at my side since then," says Smith.

SIDEBAR: Morale-Boosting Moves

by Lauren Gibbons Paul

Low morale among IT staff may be at an all-time low. Improving employee spirits should be a priority. Here's where you can start

Spend a few dollars on a team-building exercise. It doesn't have to be coal-walking or a week at a resort. Have a one-day session led by a facilitator.

Seek advice from everyone - at all levels of the organisation - as to how to improve their work environment. Put a task team in place and follow up with in-person meetings no less than once a month. Even if you're in a funk yourself, take a deep breath and just do it.

Show employees how and why they matter. "You have to communicate that what they're doing is contributing to the betterment of the company. Let people know times are tough but you do appreciate their efforts," says Beverly Lieberman, president of executive search firm Halbrecht Lieberman Associates. This is the time for town hall meetings, brown-bag lunches, morning doughnuts, evening pizzas, and formal and informal pats on the back.

Talk about the extra burdens tight budgets have placed on them. Ask what would help them balance work and family demands. Their answers might surprise you. Time, not money, is a more precious resource for many people, says Maria Schafer, program director for Meta Group.

Arrange to have senior managers visit when staff members are working extra hours. It means a lot to IT people to see that someone senior knows and appreciates what they're doing.

Be honest and clear about the tough things. If more retrenchments are a possibility, say so. Don't make your staff read about looming cuts in The Fin. For those who remain, let them know exactly what is expected of them. Offer benefits such as comp time to assuage hard feelings and frayed nerves.

Don't let community involvement slide. Duke Energy is extensively involved in its local schools, helping high school students learn key skills in a program called Tech Connect and getting computer access for economically disadvantaged children in a program called Neighbourhood Connection. People find it rewarding in tough economic times to work on these programs, says Cecil Smith, CIO of Duke Energy.

Let senior staff take a hit. At Duke Energy, raises and bonuses for the most senior managers have been frozen since last year, while more junior people are still eligible to receive them.