Starting from a career in IT is no barrier to taking the top job in business, says the CEO of the Irish Greyhound Board. He argues that technology delivers real value not by helping organisations stay in the race but making them win, and changing the rules of the game.
First of all, can you explain about your background – you’re CEO but you have a very strong grounding in IT.
I have a Masters in Computer Science; I liked IT growing up and after I graduated, I spent almost ten years with Hewlett-Packard in the inkjet division, where I was responsible for all the IT capabilities to move, manufacture, grab data, analyse and help move products. There, I was working with really clever, good people … That’s where I cut my teeth and saw value of IT and what it can do for the business.
I left HP because I wanted to apply IT in a customer role. I did an MBA. I wanted to see how to reach the customer with technology. The job as IT director with the Irish Greyhound Board came up and I was excited by the possibilities. A year and a half after that, I had the opportunity to apply for the position of chief executive.
What kind of grounding did technology give you to be able to take on the CEO role?
To some degree I’d pride myself as having a good balance. To work well in modern business, it’s about defining yourself as T-shaped individual – that’s not just technical breadth of knowledge but a horizontal breadth of knowledge across the business. I think those types of people will ultimately be more valuable than someone who is I-shaped – only with knowledge in the technology area.
What do you think IT people can do to make themselves more valued within their own organisations?
What they can do is, don’t be afraid to think about the marketing message they give out: talk in a language the business understands. Don’t talk in terms of server speeds or 64bit computing; talk about it in terms of the business, so people don’t just turn off when they hear the IT people talk; that they get a real sense that these guys are looking after the business and helping it to move forward.
How can a CIO or IT manager aim for the top seat?
Soon after I took on the role of the chief executive, I was at an event and got to know one of the heads of IT at a pharmaceutical company near us in Limerick. He sent me a mail with ‘one of our own has got a position’.
There was a view that you had to come from a finance background to get the CEO role. I would argue, IT is the chief engine of growth or operational excellence worldwide. Technology is everywhere. Coming with that deep mindset, there’s no reason why a lot of IT people shouldn’t think of themselves as able to take on a leadership role in business.
Equally, business needs to understand the value that a CIO can bring. I’m not the first to take the step but I think there’ll be many more after me.
How big is your IT team, and to what extent do you rely on external vendors to supplement your in-house skills?
I’m clearly of the view, you identify what’s core and what’s not core … The reason we outsourced to Eircom and Amazon is, they’re the best in the business. And Amazon promises to drop its prices year on year.
Eircom came out with the best value possible. And they could give us the necessary SLAs [service level agreements].
Our IT team at the moment is very slim. We have three people who work in IT and we outsource other parts, such as our tote engine.
You’re referring to your recent €1.1m IT deal with Eircom, which included cloud computing. At a time when some organisations are still reluctant to make the jump, what made you decide cloud was a technology you could use and depend on?
We felt that like everything, we used to look at the allocation of capital with my CEO hat on, and you look at the needs of the racing industry, and the need to continually invest in the IT infrastructure. For 2-3 years we hadn’t invested in our server and desktop environment. The cost of keeping lights on was becoming very expensive. We noted the work around cloud and the ability to virtualise, we looked at the companies around the world doing that, and I was satisfied that a virtualised cloud was the way to go.
If you have a situation where you have 17 different sites located all over Ireland, and let’s say somebody has a problem with their PC and there’s racing that night, having to send someone to them to travel and fix problem is expensive.
We have virtualised our desktops, so effectively what we’re now running is a series of dumb terminals, if you like. Having the ability to remotely log in and solve a problem allows us to be more flexible, respond faster to business needs, and allows us to concentrate on the positive growth of the business. From an operational excellence perspective, your total cost of ownership over the long term is reduced, and it allows us to spend money on our growth strategy.
Are there any other IT trends that you think could deliver business value to IGB, or other areas you’re actively looking at?
I’d look at a few things: first off, software as a service. Now you can go and pick the applications you want for an amount of time. There are fantastic apps out there and they cost a fraction of the current solutions.
One of the things we’re trying to do more and more, is tech allows you to reach out to everybody on an individual basis. It’s like the 80:20 rule: the last 20pc [of customers] is where you get the highest margin; technology allows you to reach out to them.
The other thing which is a key issue for us is security, regulation and control, and giving people the comfort that their data is well looked after. Where we will also invest more going forward is data analytics for a source of competitive advantage.
In IT, there’s always talk of the balance to be struck between what you spend just keeping the lights on, compared to what gets spent on innovation. Are you conscious of the need to redress that balance?
I’d nearly have three categories: to keep the lights on is to be in the race; then you win the race and then, how you change the rules of the race. For a long period of time it was a 70-20-10 split.
My focus for a long time was how to win the race and change rules of race. I would argue, the ability for us to send our data worldwide is the ability to change the rules. The ability for people to have a [betting] app on their phones, means I can go straight to the consumer with this platform and they can bet with me.
Up to now, IT will always be a cost if all it’s doing is keeping the lights on. But if you can get your costs reduced on staying in the race, people will be more willing to invest in winning the race and changing the rules.
There’s no doubt, a lot of people in leadership positions probably look at IT as a cost and something they don’t understand. The challenge for the IT community is to know the business better than the businesspeople themselves – you have to come with solutions to problems that haven’t even hit the chief executive’s desk. Anybody can buy the technology, but how you use it – and how your organisation benefits from it – is the only way to differentiate yourself.
As someone who understands technology, how easy is it to persuade people who maybe aren’t as technical?
It’s a great question; for me, I need to convince my board, who are super-critical in terms of getting value for money. You can point to operational savings made over the past five years. We reduced those costs by 46pc which is highly unusual for a semi-state.
All of that is at the back of significant technology investments that allow me to streamline our processes, and put people in higher-value contributing areas. There’s also less paper on the desk.
It’s easy to point to what you generated in the past as a way to make the case for what you want to invest in.
You made those savings, what’s next for your IT strategy?
In the next week, we’re going to launch our five-year strategy for the industry going forward. There will be more things around clever marketing, more availability of betting.
Before, there was a clear gap between the business strategy and the IT strategy. Now, IT is so intertwined with the business, it becomes IT-driven projects that the business supports, rather than the other way around. What I would like to see is less and less [investment] on running the race, or keeping the lights on, and more and more time staying ahead of the curve.
Gordon Smith
