Challenged to deliver examples of alternative thinking at a Melbourne conference last month, the CIOs of three large corporate and government organisations had little trouble delivering.
The CIOs of Fairfax, Australian social welfare agency Centrelink and miner Zinifex each fronted at HP’s Tech @ Work conference to deliver stories of how their IT groups had helped support business strategy on the fly, giving the lie to suggestions that IT is slow to react.
Perhaps the best example came from John Wadeson, Centrelink’s CEO of IT.
With six million clients and an IT spend of A$400 million a year, Centrelink is one of the biggest IT shops in the region. It has 1,000 service centres and answers 30 million phone calls a year. Two million clients are registered for online self-service.
Wadeson spoke about a fundamental change in the way government is working, shifting from delivering the same set of services consistently across the country to a more targeted approach, addressing specific regional problems.
Wadeson says while unemployment in Australia is very low overall, there are still areas where it runs at 15%. That has resulted in what he calls “place-based” policies that challenge corporate IT to deliver in new and innovative ways.
The Northern Territory Emergency Response was instigated by John Howard’s Coalition government to address issues of indigenous disadvantage. The controversial policy is still in place. Indeed, the Territory’s Labor Party was last month reported as wanting it to stay, perhaps renamed as “Special Measure in the NT”.
Wadeson says such new regional policies required IT generate the capacity to deliver straight away. “The IT group has to do the big things we do with high discipline. But we have to keep a flexible, responsive capacity.”
Wadeson says being responsive applies to IT as much as to the business.
Part of the NT programme was to introduce income management in Aboriginal communities, where benefit money has to be spent on goods of a certain kind. Under the scheme, supermarkets were enrolled as partners, with Coles and Woolworths cards handed out to beneficiaries to purchase those goods.
That required complex accounting from Centrelink and the ability to sign up communities at the rate of 15 a week, often in regions where there was no phone or power. The system developed to do this is called RIMS, the remote indigenous management system.
With no connectivity, data entry was a challenge and the back-end of the system was built on the fly. “It’s a very challenging environment,” Wadeson says.
To deliver IT services in this way requires absolute determination. “You sit in front of your staff and say what’s happening and hope like hell they work out how,” Wadeson says.
Denildo Albuquerque, Fairfax’s general manager of IT, and Peter Dean, GM of business systems at Zinifex both talked about the challenges merger and acquisition activity can pose for IT.
Albuquerque talked about M&A pressures at Fairfax, which announced a merger with Rural Press in December 2006. Fairfax is consolidating its infrastructure and moving to a recharge model for IT service delivery.
Albuquerque says one of the organisation merged with used that model, but describes implementation as a “very challenging process”.
Zinifex’s Dean described how his company “demerged” its smelting business to become a mining-only company.
“We’re a pure miner with a war chest of $2 billion and in acquisition mode,” he says.
The demerger required a new company be created and a new IT organisation built from scratch. Dean says when the demerger was first mooted, in November 2006, IT was told it wouldn’t have much to do. That set off warning bells, he says, and the IT group started to plan. In April 2007, the group was told the demerger was, indeed, going to happen with a listing of the new entity on a European exchange in September.
From not having much to do, it transpired that nine out of the 11 top project priorities in the demerger fell into IT’s basket. “It became a priority very quickly,” Dean says.
Since then Zinifex has mounted hostile acquisitions and completed another merger.
• Rob O’Neill attended HP Tech @ Work in Melbourne as a guest of HP. Computerworld is published by Fairfax.