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It’s Not Your Father’s IT Shop

Information technology organizations are changing from the top down. Mere managers are a dime a dozen, while IT leaders are the precious currency needed to turn a traditional IT shop into a competitive asset for the insurance company of tomorrow.

You don't need a doctorate to know the composition of IT organizations has changed over the past few years, with Web technology demanding more resources. Likewise, forward-thinking CIOs won't need a crystal ball to foresee future changes in the mission and composition of tomorrow's IT org.

Simply knowing what technology will be needed to make an insurance company a competitive entity in the converged, Web-centric world is not enough. IT leaders will be called upon to change the way the group operates and even thinks. To do that, a strong leader is required.

"The CIO, or IT leader, has evolved," says Thomas Mangan, global managing partner with Chicago-based Andersen's (formerly Arthur Andersen) business consulting group, and member of Andersen's CIO advisory services. "The evolution has an implication for the entire organization, as IT is moving from a back-office area to a front-office function where IT is a major part of the business.

"It wasn't long ago that almost all CIOs reported to CFOs," Mangan adds. "Today, approximately 50 percent of CIOs are reporting to CEOs. That shows that...IT is a vital part of the business."

As a more visible part of the company, IT leadership is responsible for initially bridging the still-formidable gap between IT and business. "No longer is it about IT and business developing seperate plans and hoping the goals are the same," says Mangan. "The two sides have to worktogether. But, initially, it is up to the CIO to reach out and bridge the gap to the business side."

However, communication was not a skill required of many technology-focused CIOs in yesterday's IT organizations, says Daniel Pfau, partner, strategic IT effectiveness practice, financial services, Accenture (Boston, formerly Andersen Consulting). "No longer are the people with the best knowledge of technology the best people for the CIO spot," Pfau says. "A CIO has to think and act like a business person, so the appropriate mix of IT skills and business skills is important."

In fact, most of today's technology leaders put a greater emphasis on "soft" skills than technological acumen. "Great communication skills are vital for an IT leader in today's market," says Steve Tien, associate vice president, distribution systems, Nationwide Insurance ($194 billion in assets, Columbus, OH). "A technology leader has to work closely with the business side, but they also have to relay the vision and the goals to the technologists."

Also, the size of the insurance company may change the way the CIO communicates goals, says Benjamin Tomb, managing director, financial services, at New York-based KPMG, an e-CRM systems integrator and consulting firm. "The person that runs the IT for the larger company has to pay more attention to what is communicated to all the people in the company about how IT works and its benefits," Tomb says. Good, and immediate, communication in a large company can help stop rumors about IT that may damage projects or long-term goals. "The CIO in the smaller company can walk up and down the hall before nine o'clock in the morning and talk to the entire organization and answer questions directly."

At Minnesota Life ($21.2 billion in assets, St. Paul), Jean Delaney Nelson, vice president of information services, says she has seen the skills of IT leaders change over her 22 years at the company. "I have watched the leaders go from strong technicians, but maybe not good communicators, to leaders that are up on the latest technology and are heavily involved with the business side," says Delaney Nelson.

Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology. View Full Bio

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