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Power Brokers

Power Brokers

In the US, economic woes and a downturn in IT spending have put CIOs firmly in the driver's seat when they're dealing with vendors. Also the rising competitive temperature makes vendors all the more interested in hearing what customers and potential customers have to say. Do local IT CIOs wield similar power? Kind of. Sort of. Maybe . .

Australia is at risk of becoming a branch office economy", warn economists and pundits at regular intervals, but for many corporate Australian IT buyers fed up to the back teeth with trying to make their voices heard, Australia has felt like one of those for years.

When CIO magazine surveyed 284 senior IT leaders in a range of organizations in Australia earlier this year an ugly picture emerged of Australian organizations suffering neglect from vendors with their eyes keenly fixed on the more lucrative markets of Europe and North America. Twice as many Aussie CIOs complained of poor vendor support, service levels and product quality than their US counterparts.

Okay, so given that such complaints have been heard almost since the year dot, that most IT suppliers are and always have been US-based, that our total population is only about half the size of Manhattan's and that the Asia-Pacific region still accounts for only about 2 percent of a vendor's global revenue figures, all that means is that the more things change, the more they stay the same.

However, today's local CIOs are giving voice to their frustrations at a time when US IT buyers are reportedly enjoying unprecedented levels of influence over their vendors. For instance, US Computerworld's editor, Maryfran Johnson, reporting on last December's Comdex, concluded: "Vendors are no longer calling the shots or even controlling the direction on technology. For the first time, customers and consumers are in control of where technology is going."

Johnson - reporting on discussions with General Motors CTO Tony Scott and Burlington Northern and Santa Fe Railway Corp CIO Jeff Campbell - said both men also noted the dramatically shifting equilibrium of power in the computer industry. "I'm seeing a lot less of the technology vendors pushing this or that. It's more the voice of the customer now," Scott said.

"I wish," the red-blooded Aussie CIO might wryly reply.

In reality, of course, the influence Australian customers have is and always has been limited, unless you are - as Gartner research director Kristian Steenstrup puts it - "a big dog": an organization that is strongly influential on an entire industry.

"The only thing that's changed is that there's a bit more leverage on price negotiations," Steenstrup says. "Everything else - the terms and conditions - they're [the IT suppliers] usually not interested in negotiating, because that's all passed down from head office. The local people can posture about being the president or managing director of this or that, but really they're a low-level salesperson in a remote region that contributes 2 or 3 percent to the global revenue. They have the business card but they don't have the voice."

But as is the Aussie way, what local CIOs lack in clout, they are making up for with ingenuity. Australia's isolation has always forced its citizens to be inventive, and our CIOs have found various ways to maximize their influence, depending on their size and the nature of their business.

Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.

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