Paul Daugherty Profile: Innovation as a Task - CIO Magazine -- Full Text

As worldwide supplier of the technology for Accenture clients, the Accenture executive also has an immaculate vision of Information Technology in the long term. “In essence, the CEO’s challenges are my challenges.” The work activities as the chief technology architect within Accenture are primarily externally oriented. In order to serve Accenture’s consumers as well as possible, worldwide he has at his disposal some three thousand technical architects, who divide their attention among thirteen distinct regions. Moreover, from his office in New York Daugherty provides support to the Accenture CIO and his team.

"The Collaboration 2.0 project is an example of one of the internal initiatives for which I was responsible. It was aimed at the internal application of new possibilities for mutual cooperation. One specific example is the Accenture People Pages, sort of a Facebook for internal use. Such an initiative dovetails very well with the needs of our personnel, who on average are very young. We have a search function, blogging capabilities, all that type of thing.”

Division
Although there is a clear separation between his organization and that of the CIO, Daugherty assists the internal IT department with a large number of beta applications. Take AccentureTube, a private YouTube on which employees can post videos that pertain to a client or some other current issue. But it’s internally oriented and well secured. "Posted film clips can be marked and reviewed by others, just like on YouTube. We have also arranged a wiki, so that developers throughout the whole world can work together on projects. That not only led to much better usage of the talent within the organization, but once again it also ensured savings on working hours and travel expenses.”

But internally-oriented development work is sort of a sideline. For the New Jersey-based technical architect, the client is key. “In essence, I have two important responsibilities. I have to make sure that we really deliver the solutions our clients ask for, and that they are connected to their internal processes. Moreover, it’s my job to be innovative when it comes to the development and implementation of new, emerging technologies. In light of that, we are very busy with things like service-oriented architecture (SOA), open source, software as a service (SaaS), web 2.0, cloud computing and mobility.”

The beauty of it is that he can then provide similar solutions to his clients. According to the chief technology architect, that happens increasingly often. “Many people in the industry still believe that your web 2.0-type things should be done after working hours. I see it differently. We’re still at the beginning where these technologies are concerned, but I positively believe that these can be applied very effectively within the work situation.”

"We make our clients as aware as possible of the capabilities of web 2.0 and then try to wholly integrate these solutions within their commercial processes,” continues Daugherty. “The result is that people can spend their time more efficiently and thus can be more productive. It mostly concerns internal communication and collaboration. Another example is that we can use similar means to let our clients communicate with their clients more easily.”

In the future, according to the top IT architect, it could even be possible to make a dashboard that not only incorporates interactive communication and collaboration capabilities, but even includes integration with e.g. an ERP system. Daughterty says there are still many more applications to consider, for example a bidding system fully connected to the business process to match up supply and demand in real time.

But new developments, which rapidly succeed each other, naturally have their downsides. The implications with regard to complying with the laws and regulations, and the demands that companies or government organizations make for privacy and security, are some examples. But according to Daugherty that is no reason not to get into it: the challenge, in his eyes, is to guarantee sufficient accessibility but to do so in such a way as to ensure that everything is secure.

"But the greatest risk may well be ignoring all the possibilities,” Daugherty continues. “I know of businesses where the employees have been forbidden to use Facebook, wikis and instant messaging because the employers think that it takes place at the expense of productivity. But we already had that discussion with the emergence of e-mail and mobile telephones. Once again, the challenge for the CIO is to embrace new possibilities but meanwhile maintain sufficient control.”

"We try to integrate Web2.0 within Business Processes” SOA wasn’t so much a trend in itself, but it made new trends possible.”

Out in Front
Paul Daugherty must provide his clients with the latest and best technology. That implies that he undoubtedly will have an intense and major impact on IT. An open door or not; as far as he is concerned, for the time being the so-called ‘consumerization’ of IT will continue to be one of the most important drivers of innovation within the IT business. However, the consumer as a booster of new technologies within organizations is a very remarkable shift in his eyes. “Since the ‘80s the greatest innovations have invariably been driven by providers like IBM, ICL, EMC and Hitachi. That’s where the money was made – the risk capital went there, IPOs took place there, companies wanted to invest in that.”

"If you follow the venture capitalists, flotations and investments a bit nowadays, then you come to the domain of consumer-oriented websites such as Facebook, Google and YouTube. That’s where the innovation is coming from right now. And then we’re back to the challenge for the CIO, who has to find a place for these possibilities within the organization.”

Power Shift
"Simultaneous with consumerization, what I call a ‘power shift’ is taking place: big businesses are no longer running the show with their mainframes, servers and web applications; by now, the end-user has the power. A shift therefore, imposed by the powers that be, to a client-oriented model. Thanks to SOA and cloud computing, among other things, end users are able to make their own mash-ups of services and figure out their own means for social networking.”

Until recently, SOA was still spoken of as the big trend. Meanwhile, in Daugherty’s opinion it’s very clear that SOA wasn’t so much a trend in itself, but rather the technology that made new trends possible, such as consumerization and the power shift that accompanied it.

Daugherty: “I’ve been in this industry for 25 years now; I’ve worked for several other ICT firms and also have research experience. Over the course of the years I witnessed three major developments: the host-centric approach in the 1980s, then clientserver technology and the web-centric approach within clients and software on the network. But the biggest trend of them all is the ability to use new technologies to combine different computing resources.”

Wait-And-See
The Accenture executive also sees that many CIOs still have a bit too much of a wait-and-see attitude with respect to new opportunities. “Don’t get me wrong; I have an enormous amount of sympathy for the CIO and am aware that a lot of things come down on him.” But most of them still definitely have some work to do: “The consumer side of IT has been underexposed for a long time. A lot of money has been put into backoffice systems and compliance, among others. In these investments the investor has primarily taken center stage – not the client and not the end user. That must be put right.”

The additional challenge is that older technologies don’t always connect equally well with modern capabilities. For example, Daugherty says that an SOA may in fact make it possible for you to assemble your IT in a new way, but you still need to understand the business process well enough to get the most out of it. The same thing applies to using software as a service: “That only makes sense if it meshes exactly with your internal processes. The problem is that organizations are not structured based on the process, but on the basis of business divisions. However, Accenture can help to change this using process modelling, among other tactics.”

One other topic Paul Daugherty would like to raise is open source. There are many opportunities in this area and he notices that there is also an increasing interest from the client side. In his view, the growing interest is motivated both by low transaction costs and by strategic considerations. “If you look carefully you find that the promised cost advantages of open source is always a bit over-optimistic. They’re often there, but for large enterprises the advantages lie particularly in preventing lock-in situations and ensuring a greater degree of flexibility.”

"Anything that makes it easier for our clients is good for us.”

Daugherty is a firm believer in open source code. For example, he ran a Java application within Accenture in which enormous sums were invested over the years. “We continued to do that, because this software did things that clients really wanted. It was about batch functionality for which no open-source alternative was available yet. Ultimately, together with our partner SpringSource we rebuilt the technology in open-source (the Spring Batch framework, ed.) and now you see it applied in abundance.”

Daugherty admits that this approach partly cannibalizes from the existing business, but he doesn’t think that’s a problem. “Everything that makes IT easier for our clients is good for us, because that in turn creates new demand. For software as a service, too, you could say that it comes at the cost of our integration activities. But you could just as easily see it as an opportunity. And it was the same way in many organizations when Cobol had to give way to SAP. The reality was that the IT sector grew, because technology was used more in a broader setting.”

Challenges
The CIO’s challenges are in fact the challenges that Paul Daugherty faces. He, too, must seek a balance between the application of all the technical posibilities and the degree to which these make a contribution to the business. But he also has to figure out how to find the right people for his organization, how to keep them and to lead and train them as well as possible. Another challenge is finding the best partners.

Just like the CIO, the chief technology architect also contemplates such issues as green IT, CO2-neutral supply chains and other initiatives related to sustainability. “That’s another rapidly emerging area where IT can play a big role. Through close interaction with technology the CIO has extensive knowledge of the underlying business processes. That turns him into a very important factor for the most divergent forms of innovation.”