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Sitting Pretty

Sitting Pretty

Meet Telstra's Ted Pretty, a man who balances the communications needs of consumers, governments and businesses - and still manages to remain sane.

Just outside Ted Pretty's office is an eight-foot-high pop sculpture depicting a surfer attempting to ride a wave while being chased by a shark. It's apt.

As group managing director of Telstra (consumer and marketing), Pretty must ride the wave of consumer demand and technology capability, while avoiding the sharp teeth of shareholders, both private and government, who want the apparently contradictory goals of affordable, accessible communications for all Australians and solid financial gains.

Pretty, more than any other manager in Telstra, is associated with the company's first forays into the Internet era. It is from that vantage point he views the progress of Australia's telecommunications adventure; an adventure embracing consumers and citizens, corporations and governments.

Fundamentally his premise is that connected consumers deliver companies and governments with more communications options when it comes to reaching those individuals; and the more information consumers or citizens provide to businesses and governments, the better the services and products they provide will be. Along the way, though, issues such as privacy, security and ethics need to be addressed.

"The situation today is that we are right in the centre of the digital revolution," says Pretty. "The impact of it both in the mass market and the business market is still early days. The Internet boom is just one part of that - it simply focused more attention onto where we are in the digital revolution.

"The ability for people to communicate or transact from any device, from any-where at any time is something which we're only part way of the journey down. The technology is there, but absorption of that technology is the issue."

Pretty believes that as a society our ability to absorb new technology is limited by a number of factors, the first of which is ability to pay. "Today communications as a percentage of household spend is 2.7 to 2.8 per cent, and that has increased 0.5 per cent in the last five years, and that was up 0.5 per cent on the prior five years," he says.

A degree of communications spending is discretionary, and so affected by the wider economic conditions. If, however, communications services and products deliver a benefit, consumers will continue to increase their budgets for communications, Pretty says. "The services have to have a benefit, and typically in the consumer mass market that is convenience. One of the things we have to concentrate on is that the products have to be relevant, affordable and easy to use.

"In the business community the gating factors are somewhat different - for example, the major question is: 'Am I going to get a return on the capital that I employ in my IT&T systems?'" Business, he says, wants to be convinced that the technology is a productivity tool and improves speed to market of a product or service, improves the quality assurance of products or reduces the unit cost. Importantly, the benefit has to be translated into the language of a specific industry.

"A good example would be hospitality - for example, [in] the hotel trade, you need to understand how technology drives occupancy. Does making high- speed broadband access available in a hotel room assist you in the payback by driving up the occupancy rate?

"And use of technology in vending machines - does it improve the cycle time of inventory, for example, by being polled by the network to see if the machine's empty, or that it's out of order? Does it improve inventory control and sales?

"Another gating factor in business, and a good example is banking, say with the move to ATM environments, is that you can push it so far. But some of the recent research suggests that the community fully accepts ATMs and finds them convenient, but they prefer them to be in front of a branch. So one of the interesting things is banks are rediscovering service. Touch with the customer is important. How much technology can you employ in a customer relationship and at what point does it have limitations?

"I think we have that challenge with IVR [interactive voice response] systems. At some point when people feel confused they want to speak to an individual promptly," says Pretty, ack-nowledging the frustration that sets in after following one too many voice-activated prompts.

Tribes Like Us

Pretty acknowledges that in the future more attention will have to be paid to the way in which humans interact, and how technology impacts that interaction. He for example notes the tribal behaviour promoted by SMS and mobile phone use, which in turn feeds demand for the technology, particularly among certain age groups.

"You need to be connected, or in the group . . . if you're not connected that's a bigger problem than if you are connected. It's the absence of being in the loop," he says. "What's driving this is people's need for connectedness. The worst thing is not receiving 100 SMSes, the worst thing is not receiving any."

While that prompts high demand for the service, society's ability to manage the consequences of some of that tribalism is lagging, such as community acceptance of appropriate protocols about where video-phones can be used, or how to avoid the party-gate-crashing that SMS appears to propagate.

Pretty agrees that some of the tribalism and technology "also has negative consequences. It's like any form of communication, it is starting to develop its own social protocols. We need to be mindful that many of the activities developed by technology will spawn their own protocols, and what is right and wrong."

The march of technology, however, will not wait for etiquette to catch up. Pretty expects technology and telecommunications to continue their advance, leading to a continual increase in the velocity of information, which Pretty believes will ultimately enhance the integrity of the entire information infrastructure. "And that will improve the cycle time of investment. It speeds up the time of products to market. The only question is, does that momentum create almost immediate redundancy in systems?

"What should be possible in the future is a society where information flow is far more ubiquitous and the accuracy of the information is far more reliable so that [the supplier] knows what you as an individual require. Balanced against that is the desire of many individuals to stop that - they want [the supplier] to understand them and know them, but not to where you think every piece of your personal information is available.

"It's said in the next three years we will create more digital information than in the history of mankind. You can see the marketing power that affords your organisation, but you can also see the challenges it imposes from a privacy and risk point of view," says Pretty. "Unfortunately that puts lots of business under increased short-term pressure and one of the phenomena of the last 10 years has been the short-term view of management - you know, if you haven't turned something in a quarter then you can't be doing it right."

Telstra itself is of course under that same pressure to perform from both groups of shareholders. But Pretty believes the government could invest in a step that would catapult the nation to a new level of technological capability (and deliver Telstra a heap more revenue). "I'm encouraged that things have started to happen in the public environment. Richard Court, when he was premier of Western Australia, started to build public housing with Internet access.

"Let's not widen the digital divide, let's have policies that enable as much access to technology to the whole population as is possible. As an Australian that's what I would like to see. Of all the things we could spend money on, let's assume that it's $1000 per home to put broadband into Australian homes - that's $7 billion. If you wanted to have a major technology shift in the Australian community, it would cost $7 billion.

"What that does is start to make available to everybody access to an information flow they might not otherwise have. If you look at Korea, they are well ahead of the rest of the world and the reason is that the Korean government decided that they were going to heavily subsidise DSL rollout to try and drive availability of that market."

If ubiquitous Internet access is the key for consumer information equity - what is the most important issue for the business community?

Pretty says technology skills-based training is one key. Another is to understand the interface between communications and IT and the need for end-to-end support of the information network (Telstra for example supports Qantas' and NAB's network "right down to the desktop", says Pretty) and finally that business must extend broadband access to employees' homes.

It all comes at a cost, and Pretty thinks Australians pay too much. Apart from the subsidies in other countries, Pretty says Australia is behind the eight ball because of its own peculiar digital divide. "If you're in Korea or Japan and you're surfing the Net, then most of the traffic surfing is in their internal network, in their own language. In the US, the bulk of the surfing is in the US environment.

"In Australia, 70 per cent of the traffic is from the US. One of the things we've got to do is constantly negotiate down the cost of international carriage, and persuade people to cache data in Australia. That's why there is this issue of download.

"There are little regulatory things like free trade issues. When carriers used to exchange voice traffic between here and the US we used to pay half circuit, but when we do Internet traffic they want us to pay for the whole circuit. In the Free Trade Agreement we are negotiating with the US there are things like parity with US carriers. US carriers have had it their own way for quite some time."

And getting the price right is the final key, because, as Pretty says: "At the end of the day, technology's great but it's got to be convenient for consumers and productive for business. If you demonstrate those two things then the final gating factors are: Is the technology affordable and easy to use?" v

STOP PRESS

As CIO went to press, Telstra CEO Ziggy Switkowski announced changes to Telstra's organisational structure, including the appointment of Pretty as group managing director (GMD) of a new group called Telstra Technology, Innovation and Products, which brings together Telstra Technology with business unit product development areas, network technologies, IT systems and the highly respected Telstra Research Laboratories.

STRATEGIC DIRECTIONS

How to Win Allies and Influence Your Peers

By Susan Cramm

Professional relationships can advance - or sink - your career

IT could keep you up at night - the thought that you could get fired suddenly in spite of the good work you have done. I received a call a few weeks ago from a very talented CIO in shock after being terminated on trumped-up charges of financial improprieties. He had been with the company for several years and had been promoted to CIO a little more than a year before. During that time, his accomplishments were impressive: improved governance, alignment with the business, strategic positioning and delivery in spite of organisational downsizing.

In the CIO's final meeting with the CEO, when the charges were presented, the CEO ended with a question: "Why didn't you play golf with us during the last offsite?" You may ask (as did the CIO) what golf had to do with the cause for termination. Although the CEO denied any connection, in a single question he was more honest and direct about the underlying cause for the rift than he had been during the previous few months, when his relationship with the CIO degraded from strained to hostile.

This example underscores the importance of building relationships to be a successful CIO. To be sure, relationships are important at almost every professional level, but the stakes increase once you get to the top job and have to balance the needs of a diverse group of stakeholders.

To address this issue, large companies spend a boatload of money on developing competency models that identify critical values, behaviours and skills necessary for executive success. Executive recruiters and career counsellors advise their clients to understand their personal motivators (including financial rewards, power and influence, lifestyle, autonomy, affiliation, workspace, intellectual challenges, skill building, and recognition) and examine their cultural fit with companies accordingly.

Unfortunately, competency models, personal awareness and interviewing processes are imperfect at best. At some point, you will find yourself working with people you don't really like - and most likely, they'll feel the same way about you.

Although relationships are two-sided and you cannot control the behaviour of the other party, it is possible to change the nature and quality of a relationship.

Be positive. Executives are optimistic by nature. They believe in possibilities and are attracted to people who approach work and life with enthusiasm. Make it your goal to leave the participants in each meeting and interaction feeling energised, by placing their needs in front of your own. Don't sap energy by complaining, commiserating or gossiping. Put work in proper perspective by developing a personal life with outside interests and passions. When asked: "How are you?" make sure that you can say: "Great!" with conviction.

Say yes. If you are asked for something, find a way to say yes. Don't negotiate the what, only the how and when. The phrase that you should eliminate first from your speech is "yes, but" - it really means no and will stop a conversation dead in its tracks. Instead, ask questions that will clarify the goal, and then fill in the blanks by getting your subordinates working together.

Do the little things. Find out how your counterparts use technology, and make it easier, slicker and more personal. Compliment their organisations on their successes and hard work. Recognise their birthdays or company anniversaries or kids' graduations or sports awards. Invite them to participate in the vendor gimmes - basketball tickets, golf tournaments and so on.

Face your shortcomings. Search out feedback on your performance, and enlist others in supporting your professional development. We all have issues. You will gain a lot of respect and support by demonstrating the ability to listen and change.

In my example, the CIO did deliver the goods, but he did it in a way that disenfranchised the CEO. Truth be told, the CEO was a bit of a head case, forever changing strategies, without follow-through and with questionable integrity. Although it is unlikely that the CIO would have remained with the company for the long term, he lost control of the decision because he put his needs over those of the CEO. He poked holes in the CEO's visions and publicly challenged the effectiveness of the executive team.

For some people, this advice may seem superficial. But by giving up control (by placing the needs of others over your own), you will gain control over your employment. If you decide that the company is not for you, you will be able to exit on your terms, rather than theirs.

Reader Q&A

Susan Cramm answers questions on "How to Win Allies and Influence Your Peers"

Q: Recently our company had an outside consultant assess our organisation. One point that came up was that we are a "relationship-based company" versus a "data-driven decision company". The fact that our fairly new CEO now wants us to be less relationship-driven is good, but according to your article, it sounds like a pipedream. Do you concur?

A: Even though your CEO wants to put numbers in the people, I am sure he understands that it is impossible to take the people out of the numbers. If it's true that your decision-makers do not let facts get in the way of their assessments, then tipping the balance towards data-driven decision making should be a welcome relief to customers, competitors and frontline employees.

Q: The CEO in your column dealt with the employee one-on-one. Is it more appropriate to deal with "problem" employees that way, or is it better to use the new managerial approach of chastising the entire unit - thus creating a negative attitude across the board?

A: Scolding an entire unit, rather than dealing with those accountable, is not a new managerial trend. Typically it's the desperate act of a leader acting out of fear because he doesn't know what to do. It is similar to a frustrated parent resorting to screaming at the children. Nobody learns anything, nothing changes, and everybody wants to move out (of the house or the company) just as soon as they can.

Q: Nice article, but sometimes these hints are not applicable in an international company, where you deal with different cultures.

A: Philosophers say that man is driven by two things: the need to be good and the need to be significant. The CIO in my example undermined the CEO in both respects. He challenged the company's strategic direction and the way the CEO was leading the organisation. If certain behavioural hints just don't work in your culture, then translate them, keeping the underlying drivers in mind.

Q: I never met my boss, who was in another state. Our communication was only by telephone and e-mail for more than five years. A month after we finally met, I was fired on trumped-up charges of inaccurate data. The only thing I can put my finger on is that I'm a member of a racial minority, which the boss did not realise all that time. How do you change that? Later I discovered that image was everything with this person.

A: You don't change the boss. Make sure you learn what you can from the situation and move on. Find a professionally run company and meet your boss face-to-face. Last but not least, don't become jaded and lose your willingness to invest in building strong relationships.

Cramm is president of Valuedance, an executive coaching firm based in California

MANAGEMENT REPORTS

Leadership Lag by Edward Prewit

How do the visions of corporate leaders compare with the day-to-day reality of their employees? To put it simply: they don't.

Between the visions of corporate leaders and the realities of their employees lies a gap the size of the Grand Canyon, according to a survey conducted last northern spring of more than 11,000 US workers.

FranklinCovey, which as a company focuses on effectiveness assessment and training, surveyed frontline workers, managers and executives across a broad range of private companies and government agencies on how well their organisations function. The responses to the statistically valid "Execution Quotient" study paint a Dilbert-like picture of the workings of US organisations.

Regarding high-level goals, only 52 per cent of employees said their organisations have decided what the most important ones are, and only 44 per cent said they clearly understand the goals. Only 19 per cent of survey respondents said their work goals are clearly defined, and a mere 9 per cent believe their work has a strong link to their organisations' top priorities.

So just what are US workers doing all day long? Nearly a third of survey respondents' time goes to activities that demand immediate attention but are mostly irrelevant to top organisational goals, such as unproductive meetings and micromanagement. Another 19 per cent of their time is spent dealing with internal bureaucracy.

Personal effectiveness guru Stephen Covey, who is the author of The 7 Habits of Highly Effective People and vice chairman of FranklinCovey, offers some advice on countering this dismal prospect. First, leaders need to settle on a few clear top goals and then incessantly communicate them down the line. Covey warns that it's easy to assume that frontline workers are aware of organisational goals when in fact they've never received the message. Second, workers at all levels must understand how their work aligns with the top organisational goals. The best way to accomplish that, Covey says, is for each person to work with her manager in formulating her individual work plans. And in a corollary of Covey's famous "first things first" mantra from The 7 Habits, he advises employees at all levels to be disciplined in their daily work. Rather than being sucked into tasks that seem urgent but are only superficially important, everyone should think about his priorities each morning, build a work plan that will result in the greatest progress towards top goals, and then stick with the plan throughout the day.

PUNDIT

Taming E-Mail By Eric Knorr

How to keep your messaging from spinning out of control.

E-mail has always been more painful to manage than it should be. Early versions of Exchange bombed for no apparent reason, while the Notes/Domino server mired e-mail management in a groupware muddle. With Exchange 2000 and Domino Server version 6, the top two e-mail servers have matured and stabilised. But now the forces of darkness have conspired to make things difficult once again.

The problem is that people are getting more e-mail and deleting less. The biggest new reason for bloat is spam: IT managers now invariably use the word exponential to describe spam's ugly hockey stick, which (if you believe some reports) accounts for as much as 50 per cent of all corporate e-mail. Compounding the problem, Enron, WorldCom and the Sarbanes-Oxley Act have everybody spooked. Should I save that e-mail from Bob forever in case the attorney general calls?

The result is that e-mail stores are ballooning out of control like never before. And that's bad news for a couple of reasons. One is day-to-day performance: E-mail server databases were never intended to handle a jillion unarchived messages. And, of course, all e-mail servers have hard limits on the size of their stores. But the real problem is the time it takes to do backups and restore when those files get really gargantuan.

Here are a few strategies to consider in taming the e-mail monster.

Get serious about spam - now. Simple domain blacklists can cut the spam problem in half immediately; the SenderBase free Web service from e-mail hardware vendor IronPort Systems could help you keep tabs on the worst offenders. New enterprise spam-filtering software such as CloudMark Authority, MailFrontier and ProofPoint install on your server and offer tons of options, but don't go overboard. You don't want false positives, nor do you want IT to have to review "suspect" spam every day, so be conservative with your filter settings and think in terms of cutting rather than eliminating.

Discover your real e-mail retention obligations. Broker dealers are required by the SEC and NASD to retain all e-mails associated with trades for three years in a "nontamperable" format such as WORM. But other industries also have requirements, so if you have questions, don't guess - consult a legal specialist in this area. In the end, you may have less to worry about than you think.

For easier restores, do "bricklayer" backups. This means you back up mailbox by mailbox on tape so that you can restore an individual mailbox rather than an entire data store only to find something deleted accidentally. The downside is that bricklayer backups take longer.

Choose your archiving. If you need to retain all e-mails for regulatory purposes, then archive everything to a separate server and get the added benefit of easy recovery. For most of us, though, the simplest way to lighten the mail server's load is simply to move attachments to a file server automatically. You can also create a rules-based system so that e-mails of a certain age along with attachments migrate to the archive server.

In the end, the most interesting trend in e-mail may be the recognition that so much of an enterprise's intellectual capital is bound up in e-mail messages. Last April, Documentum released its new Enterprise Records Management Edition, which scans e-mail content and adds meta-tags to messages for easy retrieval along with other related documents.

Lately, e-mail has become a pain in the proverbial, not to mention a potential source of liability. It's encouraging to think that one day soon, e-mail may be viewed as an asset not just by the users addicted to it but by managers who want to mine e-mail stores for valuable enterprise information. v

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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