The Other Digital Divide

FRAMINGHAM (07/06/2000) - The world is up in arms about the digital divide, the gap between what the rich and poor can do with information technology. It's an important issue, but as an affluent CIO reader, you are undoubtedly on the fortunate side of that fissure. However, there is another digital divide that may be more immediately relevant to IT managers and professionals.

This divide separates those who deal with IT from within the IT function and those who address IT in the e-commerce context on the business side. It replaces the old gap between IT people and business people; now the important distinction is whether you are part of the internally oriented IT crowd that builds and maintains IT infrastructure or part of the gang that's trying to market, sell and service over the Web. And it isn't impossible to cross, although I believe it's wide and getting wider. If you're in the IT function and feel that there is more action on the other side, the time to move is probably now.

As part of the general enthusiasm for all things e, several of my colleagues (Jeanne Harris and Dave DeLong at Andersen Consulting and Anne Donnellon at Babson College) are doing research on "The Role of the E-Manager." The research isn't finished, but they've already interviewed a lot of managers of e-commerce initiatives in both startups and existing companies. Here are some of their early findings:

The researchers interviewed some headhunters (sorry, "executive recruiters") to see what kind of people they were trying to place into e-manager positions.

They were not generally looking to CIOs or IT managers for these roles.

The e-managers interviewed were not part of the IT functions and didn't look to that domain when thinking about their future careers.

E-managers had technical savvy in common with IT managers, but they had more than that to offer as well--operations expertise, marketing skills, finance knowledge and sales experience, for starters. So anyone who had hung out in IT alone probably wouldn't get the nod when an e-manager slot opened up.

It's not news that people vary in their skills and desires, so it's not surprising that these two different sets of roles would be inhabited by different people. But the differences matter. E-managers are likely to receive a greater share of their organizations' rewards and respect. When the stock options or bonuses are parceled out, people with a close tie to the business tend to do better than those more remote from it. They'll also get the best calls from headhunters. Most important, their jobs are probably much less likely to be outsourced. If you outsource the work overseen by the e-managers, you're basically selling the business.

What will be left for IT in companies that are e-commerce oriented? It won't be pretty. Sure, there are still CIOs in companies like Amazon.com and eBay. But they're not exactly at the center of the action (that is, they're not mentioned in 10-K stock option listings). And many e-companies will want to rent IT service from outside or get it over the network from an ASP so that they can minimize fixed costs.

CROSSING THE DIVIDE On the surface, you'd think that IT managers could move easily into e-manager jobs. Both roles involve a basic orientation to technology. And managers in the e-world need many traditional attributes of good managers, including the ability to communicate effectively, the ability to manage effectively across business functions, and the capability to construct processes and structures to accomplish repetitive tasks. As dotcom organizations build scale and service, this latter trait will be particularly critical. E-managers and IT executives also both need to set goals, establish performance measures and hold employees accountable for their performance. None of this is easy, but it's not new to successful CIOs and IT directors.

Now for the bad news. When the researchers spoke with e-managers and those who recruit them, they discovered some characteristics that are not at all pervasive in IT managers, perhaps with good reason. Anne Donnellon, who has studied entrepreneurial behavior in her work at Babson (where aspir-ing entrepreneurs congregate in large numbers), notes that e-managers have many attributes of typical entrepreneurs. For one, they are able and willing to change business models rapidly. They fail quickly at one approach to business so that they can quickly shift to another. With any business model they're currently pursuing, they evince passion and conviction. Overall, they find risk not unattractive and use it to forward their own careers. Such uncertainty and rapid change may not be comfortable to IT managers. Even though the IT function sees plenty of technological change, good IT managers try to create as much stability as possible. And the IT executive with a big appetite for risk is a disaster waiting to happen.

Good entrepreneurs and e-managers, according to Donnellon, don't overengineer business processes and technologies at the early stages of the business cycle.

Given how fast the business is likely to change, they want to maintain leanness and flexibility. Used to building as much functionality as possible into systems, IT managers may find it difficult to accommodate to this good-enough-to-get-by approach.

Good e-managers are probably not particularly good over the long-term and realize their shortcomings in this regard. They get bored quickly and like to move on to the next business idea. It's when they stay beyond their time that many entrepreneurs get into trouble. CIOs often don't stay in their jobs long, but that's rarely a matter of preference.

E-managers are players in the broader games around e-commerce. They use other peoples' money, not their own or even their company's. They know a lot of people--venture capitalists, investment bankers, potential employees. IT managers, on the other hand, come with a different portfolio of relationships.

They might know some vendors, some consultants and some IT professionals who worked for them in previous jobs. But they're not expected to be players, and they will spend the company's money, often quite liberally.

Despite all this, if you're an IT manager and want to become an e-manager, there's probably still time. There are not enough real e-managers to go around, so e-commerce companies will gamble on someone who doesn't display all the attributes. The best way to move in the e-managerial direction, of course, is to get at least partial responsibility for an electronic commerce initiative in your current company. You may have to give up part of your current job to get it--as I've argued, the roles are somewhat contradictory. But build up your Rolodex. Make risk your friend. Fight those urges to be stable, responsible and reliable. And soon the headhunters will be calling you.

Tom Davenport cogitates at both Andersen Consulting's Institute for Strategic Change and Babson College. He welcomes reader comments at davenport@cio.com.

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