This month we present Rhonda Gass, VP and CIO of Stanley Black and Decker, and former Vice President of IT Strategy, Technology and Governance for Dell Corporation, for a lively discussion of strategy; how to balance your investments as a CIO and the possibilities of data driven predictions.
K: What is unique to the IT department of Stanley Black and Decker? What’s something you’re doing differently because of the industry you’re in?
R: I’m not sure it’s necessarily unique versus other IT organizations. I think there are degrees of variation. In fact, one of the things that I’ve found, having worked in a few IT organizations, that it’s the same game, you’re just in a different ballpark. There may be different demands, or different pressures, or different objectives at any one point in time, but we’re all dealing with many of the same things. And that is, how do we balance the risk, the risk profile of the company around things like cyber security, how do we deliver the value that the business needs and the things that are expected of us, and then how do we contain our cost? So, there’s always that three legged stool of risk, value and cost. I think the fourth issue for all of us, well not necessarily an issue, but in finding the right balance on those three things, is how do we make sure we have the right talent? Because technology is changing so rapidly, we have to have the right partnerships with third party providers and understand when to partner and when to bring things in house. So, talent is a fourth dimension in that overall equation that I think all CIOs are dealing with.
K: What strategy do you use to try to find that balance?
R: The strategy we use is to look at our investments in balancing those four things as a portfolio of investments and we’re very transparent with what we propose back to our business leadership. We have senior leadership discussions about which levers we feel comfortable pulling. I’ll tell you there are years where you over index on risk, there are years where you over index on value, and years where you over index on the cost dimension depending on what’s required of the company at that point in time. But my goal is to be able to provide clear transparency around what those decisions mean when we for example choose not to invest in cyber or we choose not to invest in projects that deliver value that we fully understand what that return on investment decision really means. So that’s the approach, a meaningful return on investment across the portfolio kind of discussion.
K: Tell me about your investment in cyber security right now. What are you doing to try to mitigate the risk there?
R: Well I won’t discuss the specifics of what we’re doing. But I will say that probably every CIO is seeing that their investments in that space are increasing. I think we’re also seeing more and more opportunity there in the role that artificial intelligence and other advanced technologies can play by helping us be more predictive than reactive. Our goal is to go from detecting, protecting, and reacting to being much more predictive in that space. Our strategies are improving, taking advantage of new technologies, and that’s kind of the way we think about it on that continuum of getting more predictive.
K: What are some of the tools and strategies you use, or some of the people that you employ, to try to become more predictive?
R: We leverage the industry quite a bit. I think it’s really the advancements that are taking place in big data and in the analytics and machine learning and things like that that are allowing, not only Stanley Black & Decker, but all companies to get more predictive around what’s going on in their environment. We can look for things that are out of the norm and take action before they potentially become a problem.
K: Do you employ data scientists? Who’s looking at all of the data and trying to figure out how to predict what’s going to happen next?
R: Well, in the cyber security space we rely on third parties. There are a lot of great third parties out there that deliver fantastic capability as a service and through their technology expertise, and that’s what we leverage. Now I have some great security analysts and network analysts within the organization that direct that activity, but that’s how we approach it. Also, throughout our company we are ramping our data scientist skill set. We know that there is huge opportunity in serving our customers better through data mining.
K: What is your greatest challenge as a CIO of Stanley Black and Decker?
R: Well, so in addition to balancing the dimensions that I talked to you about, cost, risk, value, people, the maturity level and the needs of those diversified businesses are very different. For example, we can’t deliver one capability and have it work well across all of our businesses. Often times, one of my businesses needs a manufacturing capability ramped up while another business needs some sales capability ramped up. There’s not a single customer value chain within the company. There are multiple customer value chains, if that makes sense. At Dell there was one primary customer value chain that the entire revenue stream would reside in. It makes it a little more difficult to get that cooperation across the company when the customer value streams are so diverse.
K: I imagine it’s also a little more interesting though.
R: Yes! Exactly, the thing that makes it more difficult also makes it much more interesting. One day you’re working with the global tools and storage business, the number one tools and storage business in the world, and then, you know, the next day you’re working with a smaller oil and gas business that’s doing pipeline welding and inspections and trying to solve what some of their problems might be from an IT perspective, so a very different dimension.
K: Where does application development fit into your strategy at Stanley Black & Decker? Do you do most of that out of house since it’s not necessarily as technology driven as Dell?
R: Stanley Black & Decker has been a very acquisitive company. Over a ten year period we did just over a hundred acquisitions. Some of those were large, some of those were small, but a hundred nonetheless. So we have a very mixed array of applications and a very mixed array of skill sets and approaches around those applications. What I will tell you, is that with the Black & Decker acquisition we acquired some very strong in-house capability around ERP and we still retain that today, so we have in-house capability. We augment that with third party resources that help us in the support and maintenance of those environments. In other areas, such as the digital or website space, we leverage third parties pretty heavily because with the ever-changing technology pace out there, you just can’t keep up with an internal footprint. In order to get scale, you have to leverage third parties. So, we have a pretty healthy mixture of both. What I never want to outsource though from an application development perspective is our opinion. We have to have enough enterprise and solution architectural control of the applications and projects that we’re delivering so that we are always in the driver’s seat of those decisions. Versus, you know, getting tied into something that we have no knowledge of.
K: Are there any recent technologies or trends that you think are particularly important to pay attention to?
R: Absolutely, so I think there’s one technology trend that’s really enabling a lot of the others, and that is just computing and networking and how those basic things have changed as we’ve moved from mainframe to client server, to now the capability of doing in memory processing and performing all of that in the cloud versus on premises. I would suppose that many legacy corporations, like us, run in a batch mode where you run a job, you take the output from that job, you run the next job, you know, the thing goes on and on. It may be three hours and then you run another. Fast forward to today and the in memory and cloud technologies allow you to do all that in real time. So it’s a fundamentally different approach to your business process. I think that, in and of itself, has then enabled some phenomenal things around artificial intelligence, machine learning, robotics, that we didn’t even conceive as possible just a few years ago. It was science fiction just in the recent past. It’s the reality, right? And it’s because of the processing speed and the ability to comb through millions of unstructured data elements to draw conclusions and to get smarter, really on the fly. So what does tomorrow hold? I have no idea, but I’m sure it’s going to be phenomenal.
K: On the flip-side of that last question, are there any trends that you think won’t be around for long? Or, in fact, should not be trending?
R: I think there’s a lot of political and social implications of the trends that I just don’t understand and I’m not sure where that’s going to go. I’m not sure that our political and social structures, government structures, are going to be able to keep up. But that’s a well written about topic, so I’m sure you don’t need to hear me espouse about that. One thing I failed to mention, and I’m sure if you’re talking to others it will definitely come up, and that is something we’re seeing both on the internal technology side as well as in our products and our offerings, and that is the impact of the Internet of Things or IOT, where everything has a sensor and everything has the ability to be traced and connected. IoT is opening up huge business model changes and value drivers in the products that we sell. It’s also opening up huge opportunities for productivity in our internal operations. That was one technology that I left out from your previous question but certainly relevant to our discussion.
K: Do you think it is a good thing that so many things are now able to be connected?
R: I think it’s absolutely a productivity enhancer. When a machine can talk to a machine and not have a human intervention, per say, then you can speed up the process or speed up a customer interaction. It frees up time to go to the next thing, so I think it’s all positive. Hugely positive, I can’t even envision all of the possibilities it’s moving so quickly. I guess the one daunting task is where do you start? Which technologies are the right technologies? And I’m not sure that that’s the right question anymore. So, maybe this is a difference, is given that technology is changing so rapidly, do you make your technology purchasing decisions thinking that it’s something you’re going to live with for the next ten years or twenty years? I think you have to make decisions more experimentally focused. I’m willing to make this technology purchase decision and learn and see how it goes, and if something better comes along, come up with techniques that allow you to make that transition very rapidly.
K: Allowing wiggle room, per say.
R: Exactly, you can’t predict what’s about to happen. So the more flexibility and wiggle room you can build in, I like what you said, “the wiggle room”, that you can build into your strategies and your tactics, the better off you’re going to be in the long run.
K: What would be the number one piece of advice you would give to another VP of IT or CIO in your industry?
R: Well, it would be a lot more than one thing I’m afraid, but, you know, being flexible. Everyone wants speed. They want quickness, and so being able to have a productive conversation around what it requires on both sides of the outcome to be quick and to be nimble is something that’s important. I would say, it’s no longer being a technology expert that wins the game, it’s being able to listen. Understanding problems and how to solve those problems with technology is where the focus should lie. I think so many IT organizations 10-15 years ago were heavily in the coding and configuration and setting up databases and configuring networks and that’s just not the reality of the skill set that’s needed today.
An evolving time calls for an evolving strategy, so transitions to short term investments, increased cyber security investment, and an experimental mindset may keep your IT strategy up to date advises VP and CIO of Stanley Black and Decker. A great thank you to Rhonda Gass for the wonderful interview and thoughtful reflection on the life and strategy of a CIO!
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