CEO Guide to the New CIO

Intel's Bryant Brings Business to Changing Role of CIO


When Intel (INTC) Chief Executive Officer Paul Otellini picked Diane Bryant to be chief information officer for the world’s largest chipmaker, staffers lamented her lack of information technology chops. “She’s not from IT!” Bryant remembers some employees grumbling.

Bryant had spent more than two decades working on Intel products such as servers and chips for mobile phones, not in the IT department. Her promotion in 2008 reflects the shifting demands on the teams that handle corporate networks and data centers.

As technology plays a more central role in products and employees do more work on a broader range of devices, CIOs need experience running businesses and spurring innovation—not just keeping computers running, said Rebecca Jacoby, CIO at Cisco Systems (CSCO).

“Companies have always used technology to run their businesses better,” said Jacoby, who has an MBA and a background in supply-chain management—and like Bryant, lacks an IT background. “What’s changed is that technology is now a part of the products and services that companies provide.”

Information technology at some companies is still viewed as the “‘Land of No,’ that they’re slow and not innovative,” said Sharyn Leaver, vice-president and leader of the practice that serves CIOs and enterprise architects at Forrester Research (FORR).

Bryant is trying to combat that perception by pushing her department of 6,300 employees to respond quickly to crises and cut the amount of time needed to get products out the door.

A Swift Website Overhaul

When Intel’s marketing team realized that its website had thousands of pages that were difficult to navigate and inconsistent in design, it asked for a revamped site in just six months. Bryant agreed to do it. The overhaul of Intel.com took 4 1/2 months. “It was unbelievable,” says Bryant.

In 2010 her department also helped Intel’s factories reduce manufacturing cycle time by 65 percent, from 2008 rates, by better integrating automation systems with information technology. In addition, her team assisted in making the supply chain more efficient by upgrading information systems. For example, there was a 23 percent reduction in the inventory of raw materials from 2008 to 2010. In the same period, the inventory of finished goods was reduced by 10.3 percent, according to Bloomberg data.

Bryant’s push to change her group’s approach wasn’t easy. Aside from the whispers about her not being from IT, she says she spent a good six months learning geek speak, even though she has an electrical engineering degree from the University of California-Davis and had worked for many years on Intel hardware, most recently in the server group.

“When I joined IT after being at Intel for 23 years, I thought I had landed in a foreign country,” she says. “I would ask a question and everyone would look at me.” A kind colleague sat next to her in those meetings and translated, she says.

As part of her strategy to establish trust with the rest of the organization, she replaced 13 of 14 senior members of her staff with people from various business groups such as the factory or product design engineering.

“We have to go into business groups and convince them that we do really understand their business strategy, that we do know what they need, and we can deliver it in a cost-effective way,” she says.

Spending More on IT Per Worker

Innovation hasn’t come cheap. On Bryant’s watch, IT spending per employee rose from $14,400 in 2008 to $15,100 in 2010. Because Intel’s revenue increased in that period, IT spending accounted for 2.8 percent of revenue in 2010, down from 3.2 percent in 2008.

In an era of outsourcing, software services, and widely available consumer technology, some pundits are writing the obituary for CIOs, says James Staten, Forrester’s vice-president and principal analyst.

Still, in industries such as financial services and retail, information technology is seen as innovative and fundamental to business competitiveness, according to a report by Harvey Nash (HVN:LN) and PA Consulting. “The CIO role is changing because the business environment is changing so radically and very quickly,” says Hsiu Mei Wong, managing consultant with PA Consulting Group’s IT practice.

With businesses bringing products to market more quickly, customers demanding more, and profit margins shrinking, CIOs will increasingly be asked to help develop new revenue streams, innovate through disruptive technologies, and build better customer experiences, says Staten.

That is opening doors for Bryant and other CIOs to become strategic forces at their companies.

When working with Intel’s business groups, “we have to be joined at the hip as we go down the path because things are moving so quickly,” says Bryant, adding, “the velocity is crazy now.”

Rachael_king
King is a writer for Bloomberg Businessweek in San Francisco.

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