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Smart Enterprise: Greater Expectations

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methodology, meters were read only once a month by meter readers. By having more accurate and real-time information on usage patterns, PG&E can better handle energy load balancing and provide energy more efficiently, Lawicki says. The company can also more quickly diagnose problems and speed up repairs, since more automated elements of the smart grid are incorporated. And the smart grid will make it easier for the utility to incorporate intermittent renewable energy sources such as solar and wind. Organizations have a variety of plans to innovate this year, according to the survey. At the top of the list: Make business processes more efficient, cited by nearly half the respondents. The next most-common response was to introduce new IT-led products and services for customers, which was cited by 36 percent of respondents, up from just 18 percent in 2009. Innovation will also come in the forms of creating new busi- ness models and revenue streams (28%), getting better business intelligence to more employees more quickly (20%), improving customer service (18%), sharing information more deeply with customers, partners and suppliers (17%), and improving Web operations/customer experience (17%). "Two points leap out from these stats," says Chris Murphy, an editor at InformationWeek, who is also the author of the report. "One, the share of IT teams focused on growth has shot up. More than double the number are dialed into innovating with new IT-led products. That speaks to rising optimism." The second point, Murphy says, is that most IT teams still aren't focused on driving revenue. "IT teams are most comfortable driving efficiency and cutting costs," he says. "More IT leaders need to dig deep to find ways that their teams can help directly drive revenue." Overall, research shows that company culture is important to innovation. Most IT executives surveyed say the culture of their IT organization is consistent with that of the company overall. About one-third say both IT and the company culture are generally aggres- sive in strategy and execution, and roughly the same percentage say both are generally conservative in strategy and execution. And some forward-thinking IT departments are even ahead of the busi- ness: 21 percent of organizations say their IT department is more aggressive than the rest of the company, while only 12 percent say non-IT departments are more aggressive than IT. Biogen Idec is innovating by tapping outside resources. For instance, one of the IT department's near-term focuses is to better integrate third-party logistics providers and contract manufacturers into the IT infrastructure, according to Biogen Idec's Meyers. "In the healthcare space, there is tremendous fragmentation of data exchange standards, which makes sharing forecasts, inventory positions and sales data difficult. We believe there is an opportunity to develop a catalog of IT services which can be built into contracts with third parties that make integration easier and collaborative operations much more efficient." By having better integration, Biogen Idec hopes to affect revenue, too. Pacific Coast Building Products, a Rancho Cordova, Calif., provider of manufacturing and contracting products, is enabling innovation by working to get business intelligence (BI) data to employees more quickly. The main goal is to enable people to do their jobs more effec- tively. "What we're doing is making the people we have more effective and business processes smarter so when the economy comes back, we're ready to go," says Mike O'Dell, CIO. Other IT efforts at Pacific Coast involve using BI, data warehous- ing and analytical systems to improve inventory management and customer service, which can, in turn, affect revenue and cash flow. The tools, which examine historical sales data and apply algorithms, allow the company's distribution arm to calculate demand and set inventory levels to meet customer needs based on real data. Innovations require a strong IT support web, a factor some CIOs say is sometimes lacking, according to the survey. Executives report not having enough IT people or having a staff without the right IT skills. DATA: InformationWeek Analytics, "Return to Growth: 2010 Global CIO Report," survey of U.S. IT executives, May 2010 SURVEY BASE: 333 in May 2010; 600 in April 2009 Note: Multiple responses were allowed Going Global What are the primary areas on which you spend your time? 0% 10 20 30 40 50 13% 14% 8% 8% 6% 42% 27% 37% 31% 35% 41% 34% 35% ■ 2010 ■ 2009 28% 34% 20% 28% 19% 25% 14% 11% 14% 21% 9% Driving global technology and process standards Spending time with my CEO/senior executives, focusing on a strategic agenda in these meetings Measuring IT processes, output, performance Driving initiative to reduce spending on operations and maintenance in favor of spending for new initiatives Educating myself about the next wave of technologies (e.g., social media, programmable Web, wireless broadband) Managing and planning global IT budget and procurement Negotiating with vendors and service providers Driving global business or sourcing opportunities, global supply chains or trading networks Meeting with external customers Developing key potential successors and team members Spending time with my CFO discussing long- and short-term financial issues Recruiting IT talent 34 SMARTENTERPRISEMAG.COM

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