Westpac unchiefs the information officer

Comment In a move that will send a thousand chills running down a thousand spines, the Australian bank Westpac has sent the janitor down the hall to the office marked “CIO” with a screwdriver and removed the brass plate.

In a management restructure announced yesterday, the CIO job ceased to be: in essence, the PHB* has been metaphorically taken out to the back paddock for a quiet bullet and an unmarked grave.

Instead, the role has been rolled up into a new creature called “group services” that has shocked the world of senior IT executives by equating the CIO with such mundane stuff as banking operations, property services and legal services. And, horror of horrors, IT is merely a line-of-reporting to the new COO at Westpac, John Arthur.

It had to happen.

The pumping of the CIO role has a twenty-year history, with vendors and analysts as its cheerleaders. Neither group was without self-interest: everybody gets a smoother path to the sale if they’re pitching to someone with “chief” at the beginning of the job title.

That marker of status and spending power saw the usual suspects then agitate for other tech posts to get the coveted C in front of their title (for example, Chief Security Officer).

However, the strategy only works if the CEO sees the payoff by way of better IT ops, lower costs, better customer satisfaction – anything at all really. The reality has been that costs have escalated throughout the industry and, in spite of glowing reports of most big-corporate IT strategies in the media, there are too many overdue projects, flaky systems, and high-profile security breaches.

Add to this the regular clamour that demands a rework of basic systems to adopt today’s fashion or fad, and IT begins to look, from the outside, like a vast game of nest-feathering and back-scratching.

From that point of view, demoting IT to answer to the COO might even look like good strategy: it will face a much more demanding and skeptical decision-maker, and will need to demonstrate success to justify its demands - in the face of competition from the rest of the COO's brief.

I’ll bet the world’s shuddering at Gail Kelley’s decision. It’s like she’s just told Sir Humprey Appleby that the Department of Administrative Affairs has to show a profit or be dismantled: civilization will fall.

Thankfully, in the ruins there will still be the BOFH actually keeping things running … ®

*PHB: Pointy-Haired Boss, with acknowledgement to Dilbert. ®