Louie Ehrlich, CIO and president of Chevron Information Technology Company, has led a three-year transformation effort that has yielded the better part of a billion dollars in payback for Chevron. I talked to Ehrlich about how IT is fueling the execution of business strategy.
Focus On Game Changers
Chevron IT focused on “accelerating insights, automating operations and connecting people,” said Ehrlich. But so did Chevron’s competitors. By becoming experts at choosing investments that will be “the biggest game changers” for the company Chevron IT can help to differentiate Chevron’s performance.
The idea, Ehrlich said, is to create an IT environment that’s agile, so it can respond more quickly than competitors to business needs for new functionality or take better advantage of data. “With information technology being pervasive throughout the operations of the business, it’s really important that you plan, control and operate extremely well,” Ehrlich said. “Part of that is having a great partnership with the business in making that happen.”
Choose Vendors Who Embrace Your Business Strategy
“We’re not successful if we’re trying to find a place for a solution that’s being offered to us out of the context of the strategy we’re trying to achieve,” Ehrlich said. Vendors that want a fruitful partnership need to develop deep knowledge about the company and the direction it’s heading. “Companies that do that,” he said, “do really well inside of Chevron.”
Instill An Enterprise View Of IT
Chevron has an IT governance board, which Ehrlich chairs, that decides strategic direction, defines constraints and sets priorities. But in a global company like Chevron, local IT leaders and line of business or functional managers make decisions every day about which projects to work on and how they’ll get done. “In a company like ours, which is very federated, very distributed, you’ve got to figure out a way to help people make informed decisions, so that all the work you’ve done to simplify the environment and pick the right investments actually lives on,” Ehrlich said.
Chevron’s answer is “IT Concurrence,” a process that requires the business sponsor of a project to review a checklist of investment decision criteria with an IT decision maker. “What it’s done is bring enterprise perspective into local decisions,” Ehrlich said. “We have someone to help in the form of an IT leader to bring that broader perspective and then we make joint decisions with the business. It sounds really simple, but it’s been really powerful.