How should CIOs be thinking about implementing generative AI? What does it mean to be a sustainable business? What are offices for? In this episode, host Yadin Porter de León sits down with Tim Crawford, CIO Strategic Advisor at AVOA, to discuss these questions in depth.
How should CIOs be thinking about implementing generative AI? What does it mean to be a sustainable business? What are offices for? In this episode, host Yadin Porter de León sits down with Tim Crawford, CIO Strategic Advisor at AVOA, to discuss these questions in depth. They dive into the conversations that Tim is having with CIOs about generative AI and the nuances surrounding the debates around work-from-home.
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“We've been challenged for data scientists within our organization. Generative AI just takes that to the next level. And so the problem is, we don't even have the resources internally to be able to get our arms around it.”
“And that's part of what is scaring IT executives today is that they got burned on cloud. And now we're talking about generative AI. And now, unfortunately, we're talking more about data and the risks just went up. So you have to be really careful about how you go down this. I realize the pressures there. I realize there's a lot of demand to try and adopt it and get ahead of your competition. But at the same time, if you don't think about the risks that go with it and have a healthy balance between benefit and risk, you're just playing with fire.”
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Time stamps:
(02:40) What are tech leaders saying about AI?
(06:22) The need for increased understanding so we can trust AI tools
(07:01) Generative AI increases the demand for data scientists
(11:58) How the EU is thinking about generative AI
(14:47) Lessons we can learn from implementing cloud technologies
(17:01) AI as augmentation instead of replacement
(19:02) The need for a holistic conversation
(20:16) Running a sustainable business, beyond just ESG
(25:21) The overuse of the “Black Swan” concept
(27:43) How to plan for risks to build a sustainable business
(32:54) The need for an IT leader who is capable of CEO-level conversations
(34:55) What is the office for?
(40:42) The new complications of in-office work
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Yadin Porter de León on Twitter
Relevant Past Episodes:
Data Democratization and the “Intelligence Era” with Trevor Schulze, CIO of Alteryx
Generative AI: What CIOs Need to Know – with Paul Roetzer, CEO of Marketing AI Institute
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0:00:01.4 Tim Crawford: There's a more holistic conversation that we're gonna start having in general around technology and technology adoption. I'm not a naysayer on innovation, I am full force all about innovation and technology and the value and benefits that it brings. But I do wanna make sure that we are thinking about the consequences of our actions and making sure that we're going at this at the right pace.
0:00:28.8 Yadin Porter De León: Welcome to the CIO Exchange podcast, where we talk about what's working, what's not, and what's next. I'm Yadin Porter de León. Today on this episode, I sit down with Tim Crawford, CIO strategist, advisor at AVOA. Tim is a strategic CIO, executive coach and advisor that works with large global enterprise organizations across a number of industries. In this hallway style conversation, he offers his expert perspective on three major topics, Generative AI and how CIOs should be thinking about implementing it, building a sustainable business beyond just ESG and the purpose of offices. Now, this episode, we talk about these trends, but then we dig into what second order effects are starting to play out. So what are the emerging trends emerging from the emerging trends?
0:01:23.8 Yadin Porter De León: So Tim, you talk to a lot of executives, a lot of technology leaders about all sorts of things. Today is really gonna be sort of a thought experiment. And we're gonna treat this kind of as a hallway style conversation where we're in the rooms with technology leaders, we're talking about things that are working out, what is working, what's not working, or what their expectations have... Where they've been met, when they haven't been met. And so we're gonna kind of tackle three big things. And those three things are going to be, not surprisingly, artificial intelligence, what it means to be a sustainable business is another one. And then also we're gonna kind of tackle what offices are for.
0:02:00.0 Yadin Porter De León: And we kind of picked these, we talked earlier, we kind of picked these ones because we feel like they're sort of these emerging emerging trends. By saying emerging emerging, meaning they're sort of the second order effects that are kind of coming to fruition out of things, some things people expected, but a lot of things people didn't expect. And there's a lot of misconceptions about sort all of these different things. And I think I want to just unpack each of these sort of big topics so we can kind of provide some context with what conversations we're having with technology leaders, what are they thinking about is coming next? What's surprising them, what's not surprising them, where they've disappointed? And I kind of want to tackle it that way. And so, first off, Tim, well, let's dive into the artificial intelligence hype cycle.
0:02:37.0 Yadin Porter De León: And we are sort of heading down into the trough of disillusionment. There's a lot of people that thought it could do everything, basically transform humanity, and it's not quite there yet. Give me a sense of sort of where you've been, where's that conversation with you and technology leaders? And I'll pause actually one second too if you... We're not gonna go into what AI is, we're not gonna go into AI is all about the data. Go back and listen to previous conversations, I actually had a great conversation with the CIO of Alteryx about data as the fuel for AI. We're not gonna get into that, but we'll start off with you, Tim, to talk about what are those emerging conversations that you're having and what do you think those second order effects are gonna be?
0:03:14.9 Tim Crawford: This is a great place to start a conversation, and there's been a lot of concern around Generative AI, and AI has been around for a while. It's not something that's new. We've done analytics, and you could look at it in the spectrum from advanced analytics all the way through to artificial intelligence, which is kind of how, and the whole cognitive piece and computers thinking for themselves. We're far from that today.
0:03:40.1 Yadin Porter De León: Yeah. I'm still looking for my Jarvis interface, Tim. [laughter] I don't know, that's... I feel like things are moving so fast. It's like moving so fast, but then I realize there's a laundry list of things I'm still waiting for.
0:03:49.7 Tim Crawford: Yeah. And when you look at some of the pop that Generative AI really kind of brought to the conversation, there was a lot of hope around what it could potentially bring. There was also a lot of concern about what that would mean, both from bad actors using the same technology as those that are trying to use Generative AI for good purposes, but then also even for the folks that are using it for good purposes, how do you ensure that you've got the right guardrails in place? Because we live in a very complex world when it comes to data and how we're using data and sharing data and whatnot, and protecting data.
0:04:31.1 Tim Crawford: And so initially it was, the conversations were along the lines of, "Wow, this is great. This could really kind of open up new opportunities for our company, for our business, new markets, new insights to customers, new insights to what we're doing from a business standpoint, maybe even show us things that we haven't seen," especially when you talk about geopolitical risk and some of the challenges of supply chain and value chains, bringing that data together and having a way to have it tell you things that you haven't been able to achieve of late, that potential was there. The challenge was, we were very, very quickly running into some of the concerns around risks. What happens when this data starts to escape our enterprise? What happens when we start bringing in other data?
0:05:24.6 Tim Crawford: And we don't know where that source data is, because there's kind of this separation between what the output is and what the sources of input are, but then also who owns those derivatives? Who owns that output? And where does intellectual property come into play? And so the conversations that I was having leading up to today have been around, there's a lot of potential here, but there are a couple things that we have to be concerned with. Number one is we have to understand how this works a little better so we can put trust in how it works and ensure that we're doing the right things and being good stewards of the data that's ultimately going through these engines. But then the second...
0:06:04.3 Yadin Porter De León: Yeah, it's a big one, trust. Trust is a... The people are really struggling with the trust piece. Just even just the outputs that are coming out from some of the tools, it's bit black box and how do we know this is right? If we're gonna base a billion dollar business decision on this piece of data, is it really doing what it says it's doing?
0:06:19.8 Tim Crawford: Right. And that's the thing, is building that trust takes time. And we need some insights to be able to do that. The second piece is understanding what those risks are and how do we kind of put those guardrails up to ensure that we're protecting the data and being good stewards of that data. Those tools aren't there. The last piece that I'll add to this is you have this other challenge that we've had for some period of time around just expertise and the capacity within the organization to be able to understand and work with these core tools. We've been challenged for data scientists within our organization. Generative AI just takes that to the next level. And so the problem is we don't even have the resources internally to be able to get our arms around it. And so that has started to change some of the conversations such that people are starting to realize, "Look, I can't work with Generative AI building blocks like I might've used other technology in the past, but rather I need to find ways to be able to adopt it using some of the core tools that are already within my portfolio."
0:07:31.7 Tim Crawford: So imagine seeing Generative AI start to show up now in core solutions that are already in the enterprise, but those vendors are starting to put those guardrails and that intelligence, and they have the girth, they have the ability to bring that expertise to the table. And what that means is every enterprise then doesn't have to be an expert in this space. And that's really where the conversation is going today as we start to realize that, "You know what? This is not the best thing since sliced bread. There are some things we have to be careful about." And then we haven't answered the question around how do we protect ourselves from bad actors and folks that might be using this for nefarious purposes.
0:08:13.1 Yadin Porter De León: Yeah, I think those are a lot of the concerns that are top of mind too. And I think what's emerging out of that is there are some good policies that are being put in place, but at the same time, you're finding organizations where you had already gone through a security review for a particular tool. Let's say, Grammarly is a great example. There's others out there as well. And that's been input in place, it's deployed across the entire organization, but then all of a sudden now it adds a Generative AI component to it. So now all of a sudden, through the back door, a Generative AI piece is being pulled into a tool that's already been deployed across your entire organization with an update and that Generative AI component has not gone through security review. Now people are putting confidential information they think is going to stay within a sandbox. And I'm not saying that this is calling Grammarly out on this. There's other tools I think that maybe run into this situation where now your data is, where's it? I don't know.
0:09:01.5 Yadin Porter De León: I can't answer simple questions like when someone puts something into a tool that now has a new Gen AI capability, where is that data going? Are we in a secure little bubble? Are we in our own separate private instance? Are we not? 'Cause that training a large learning model that someone else is gonna be leveraging. And so now you're in a situation where it's not shadow IT, it's like it's shadow updates of things that are just... And before when you did an update, it was a new button or there was like, maybe there might be something like some new feature that would, not something that was, sort of etched a transformative shift. Now that is leveraging something where, like you just described, Tim, you don't know where your data's going. How do I be a good steward of my data if now all of a sudden I don't know where it is or how it's being used, and there's no process by which I can then go and proactively say, "When is this update going out? When am I having to do security review?" Stop that update until I do X, Y, and Z. And that's kind of crazy, but it's becoming a real concern.
0:09:56.6 Tim Crawford: Right. And it goes a step further. You've got the fully fledged kind of user facing tools, like you mentioned Grammarly. I mean, not to pick on Grammarly, but there are other tools that are bringing Gen AI into the mix. But let's talk about things like programming languages and IDEs. And so the developer is working in an environment like you look at what Microsoft is doing with Copilots, now you're bringing Generative AI and code creation into the developer environment. Where did that come from? How was that model trained? And are there any intellectual property restrictions or risks that we have to consider as part of this? And so I think Microsoft is thinking really well about that. I had some conversations even with Amazon about some of the things that they're doing from a technology standpoint, and it's really impressive the way that they're thinking about solving some of these challenges. But let's be honest, they're really big challenges to work through.
0:11:00.2 Yadin Porter De León: Yeah, they're huge. And there's new regulatory things that are coming out of Washington, for example, here in the United States where you show where each piece of your code comes from, basically like a label on a food product. Here's all the different ingredients that are in here. If you're using a Copilot and it's pulling code from the vast amounts of everything that GitHub and every other piece of code that's been produced all throughout history, how do you then say, "Oh, this is where this code came from and this is where this code came from." How do you solve this? You don't know.
0:11:28.3 Tim Crawford: You don't know.
0:11:29.2 Yadin Porter De León: And these, like you said, these are hard problems. And these are, it's a little bit scary.
0:11:33.4 Tim Crawford: It's even more complicated than that. If it were that simple, we probably could solve them pretty readily. But the reality is, when you start to think about what the federal government's doing here in the US and you think about what the states are doing from a privacy standpoint around data, and then you take it a step further and you talk about what the EU is doing around the next version of GDPR and how they're thinking about even Generative AI. I was on a call with a gentleman who's kind of leading that charge for the EU around AI and data protection. And it's really impressive to hear how sophisticated their thinking is. But at the same time, it's really challenging too. So, I had a kind of Q&A session with the head of strategic intelligence for the World Economic Forum, and I was asking him kind of a similar thing, how do you ensure that you go down this path of learning about these technologies without potentially disrupting other big shifts?
0:12:34.4 Tim Crawford: So, in the case of WEF, if you're talking about Generative AI, how do you ensure that you're not impacting social rights and biases? How do you ensure that you're not driving toward things around data center and natural resources? More water and power and cooling. Because we just saw a story in the Wall Street Journal about how data centers are, their costs are increasing and it's being driven directly by AI. The FTC is jumping into this to understand more about AI and Generative AI, and ensuring that things are not going beyond the realm of potentially impacting people and serving people wrongly, whether that's children or adults or companies. And so you throw all this on the table and you go, wait a second. So, there are all these great things that it potentially could do, but oh my gosh, there's a whole laundry list of problems and challenges we have to work through to ensure that we can balance between the two appropriately.
0:13:40.5 Yadin Porter De León: Yeah. And I think a lot of the technology leaders right now, they're thinking about all these different things you're listing, but the, why is this is different now? And that's always the kind of thing is we wanna sort of look at why now and why is this unique time is because you have every line of the business now clamoring for these things, thinking they're behind because they're not adopting Generative AI tools in every single thing they're doing, and they're pounding on the door of the technology leader in the company saying, "We need this." Or they're not even, they're bypassing it completely and just saying, "We're gonna swipe a credit card and start using these," and now you don't have the same time and the same breadth and the same space to really look at each of these challenge and address them appropriately. Everyone says, yes, we're addressing them, but it's, the timeline for addressing them is gonna be accelerated way more than you would with any other tool.
0:14:28.2 Tim Crawford: You know, in some ways you'd hope that we would've learned a lesson from Cloud, right? In terms of adoption.
0:14:33.7 Yadin Porter De León: I don't think we learned anything Cloud, Tim. [laughter] Did we learn something from Cloud? No, we did. There were some good things. [chuckle]
0:14:41.3 Tim Crawford: But you think we would learn something about just blindly adopting technology and not thinking about the true ramifications. And companies are facing that today, starting to really understand, here's where cloud is really beneficial, and here's where it's not, it's not the end all be all. Generative AI...
0:15:00.5 Yadin Porter De León: It's not gonna save us money.
0:15:01.5 Tim Crawford: No. It's, and it never was. But the thing is, the marketing stuck. The marketing stuck, and you started seeing even boards with edicts that say, "Oh, thou must use Cloud or Cloud first." We heard all of this. You're starting to see harkings of this in Generative AI, and that's part of what is scaring IT executives today, is that they got burned on Cloud, and now we're talking about Generative AI. And now unfortunately, we're talking more about data and the risks just went up. And so you have to be really careful about how you go down this. I realize the pressure's there. I realize there's a lot of demand to try and adopt it and get ahead of your competition. But at the same time, if you don't think about the risks that go with it and have a healthy balance between benefit and risk, you're just playing with fire.
0:15:56.7 Yadin Porter De León: I think that's a good point to transition into sort of the next of this AI piece. And that's when you have these tools, you have a social impact as well, and you're doing good things, like, let's say, removing the fear of ideation. People now are like, "Hey, I'm gonna generate ideas really fast. Let's get ideas out and let me create them using Gen AI. And I don't feel like it's my ideas that are being put on display and being criticized. I feel like it's Gen AI's and we can just get a conversation going." That's sort of a positive side. But then there's also another thing where people are gonna be using these tools, of course, for personal use. They're gonna be using them as potentially emotional co-pilots. And now you have somebody who's using the Gen AI tool, not just for work, but potentially for chatting with and talking with and saying, "Hey, look, I had a bad day."
0:16:39.8 Yadin Porter De León: And the tools will actually start to talk back to you and provide empathy. And I think that's probably one of the second order effects that is now emerging and is not being thought about. We're like thinking regulatory, we're thinking data. Well, what about the person who is using the tool and how they're using it and using it for personal use? And there's sort of emerging conversation around the social impact and is there positive? Yes. Is there a negative? Yes, of course there's negative. And what is that gonna be? How does hallucination come into this? There's a thing where we talk about AI plus human, which is I think the real way, this is going to be AI replacing human, but what does that augmented human and AI combination really look like? And there's a lot of head scratching when you start broaching that topic.
0:17:23.6 Tim Crawford: Yeah. As I was scratching my head.
0:17:24.7 Yadin Porter De León: You were just... [laughter] For those of you who are listening, Tim was scratching his head.
[laughter]
0:17:29.4 Tim Crawford: I was scratching my head. It goes back to what I was saying, you've gotta have a healthy balance. And that's why I think at least for the time being, the appropriate place to consider AI is augmentation, not replacement. I do think that there will be a time and place that will be appropriate to consider AI for replacement of humans. Just like we saw in other technologies, the tractor replacing the horse and the ox, the assembly line. I mean, we've seen some of these pretty significant transitions through time. Even the foray of computers into the workplace. It replaced people that were actually calculating figures within a business.
0:18:09.6 Yadin Porter De León: And they were actually called computers, those individuals, like I'm a computer and, but you then had a machine that became a computer.
0:18:15.7 Tim Crawford: We'll see some of that happen over time, but I think the one piece that we definitely need to consider is at what cost? And we have to make sure that the value exceeds the cost in which to do it. So for example, if you are relying on artificial intelligence as a way to replace humans and you're taking a hit from a social impact or social skills perspective, what's the impact of that for that human being, for that team, for that organization more broadly? Whether they, when they leave the company and they go outside in their personal life, when they go to another company, when they interact with another team, you have to think about all of those factors. You can't just look at it as, "Oh my gosh, this'll help us go faster." Okay, but at what cost?
0:19:06.0 Tim Crawford: And so I think there's a more holistic conversation that we're gonna start having in general around technology and technology adoption. I'm not a naysayer on innovation, I am full-force all about innovation and technology and the value and benefits that it brings, but I do wanna make sure that we are thinking about the consequences of our actions and making sure that we're going at this at the right pace, and this is the conversation that I'm having with other executives, and it kinda gives them almost a comfort in a way to know that, "Okay, let's think about this, let's put some time and think about this, this is more of a thought experiment than just simply jumping in the technology and putting it in place and experimenting and seeing what happens."
0:19:55.2 Yadin Porter De León: Because big organizations have never thought about technology first before people and process, that's never happened before, but I think this is actually a phenomenal place for us to transition into sort of our second topic, which is that what it needs to be a sustainable business. I like how you said, what are the costs? What are the costs of this? And I think setting up this whole idea of what is a sustainable business outside of the environmental impact is this question that I've been posing, which is, can we continue to innovate at all costs? Can we continue to accelerate our time to market at all cost? Can we continue to reduce our workforce at all costs? And so I think that idea is, what is the cost of those decisions if I want to reduce the amount of capital I have to spend on a particular component of, let's say, something I'm producing as a manufacturer.
0:20:47.8 Yadin Porter De León: If I rely only one single source, and that source then is impacted by whether it's geopolitical, whether it's economic, whether it's environmental, what is the cost of that and only relying on that one supplier, and then if that supplier goes down or there's problems with the supply chain to that, then now all of a sudden my entire operations is disrupted. Now, this is not a new concept, but there's a whole different things from rising material prices to investor pressures like BlackRock sending their environmental ESG letter to the CEOs of companies. And so how can we continue on that relentless march of better, faster, cheaper at all costs, like you said, data cost center rising for AI, letting people go or not hiring as many people because you have AI in place, and what does that make the people who are at the company feel like? What are some of those emerging conversations that you're having too?
0:21:38.7 Tim Crawford: And these are very early conversations because there isn't a lot of broad conversation today about sustainability in business beyond environmental. Even environmental is at a very early stage, especially here in the US. In Europe, and I'm here, it's much more mature of a conversation. In fact, companies are reporting on it on a regular basis. But you're right, you have to think about sustainability in your business and the stakeholders that it serves, whether it's your shareholders. If you look at the whole value chain, right? So from shareholders all the way through, including customers, including employees, how do you at each stage ensure that your business is sustainable? So if you take advantage of employees and you get the cheapest, fastest resources, that's great, but you can't sustain that. And so then that has a consequence too that might have a monetary or a financial consequence in a positive way short term, but long term, you burn people out.
0:22:44.9 Tim Crawford: And then your business goes away because the quality comes down, investors and customers start to see that, and that becomes a problem. We see the same thing you mentioned in supply chains and value chains and supply chains, we've worked really hard around just in time. And I think one of the things that we learned through the pandemic is we probably push that a little too far, where we didn't have enough flexibility in our supply chain. And so when you start to think about geopolitical instability, there was a heavy reliance on countries like ironically, China, Russia, Ukraine, all three of those had massive impact in different ways to the value chain for technology, whether it's people, whether it's programming, whether it's natural resources, all three of those countries have had significant impact to the technology value chain and supply chains of building products.
0:23:45.6 Tim Crawford: We have to think about how do you ensure that you can maintain your business through these geopolitical instability sessions or time periods and at what cost. So for example, I could say, "Okay, well, I'm gonna do manufacturing in four different countries." Okay, that's great, but there's a degree of purchasing power that you lose, there's a degree of expertise that you lose in being able to centralize that within one particular location, and so that flexibility comes at a cost, but that's where you start to understand the trade-offs of one versus the other. And frankly, this is, it's a risk equation around, okay, how much am I investing to protect against what risks? And so there's a balancing effect that has to come with it, but you have to think about the people, what happens if we had a natural disaster in one of our locations? What happens if we had a pandemic? Hello, here we are, right? How do you withstand that?
0:24:48.9 Yadin Porter De León: Exactly. These black swan events that aren't becoming so till black swan, they're starting to become more regular and the flexibility I think is what I think is key to pull from that, is that technology allowed us to have something that was just in time to really maximize the efficiency of the supply chain and the technology then though needs to also reflect the flexibility that you need to be able to sustain.
0:25:11.7 Tim Crawford: I guess the one thing that I would counter on that is I think the concept of a black swan event has been used too much. Yes, they exist, but I actually think they've been used too much, and a good example is the pandemic. One of the first things that people were coming to me with is, "Oh my gosh, we don't have a pandemic plan." And I'm like, "What do you mean you don't have a pandemic plan?" I mean, 15 years ago, when I was at Stanford University, we had a pandemic plan. We had planned and walked that out as part of our disaster planning, business continuity. And so my point is not shame on them for not having it, my point is, don't look at these as necessarily, "Oh, that'll never happen, black swan event," but rather, at least go through the exercise to understand how you're going to manage through these situations.
0:26:02.4 Tim Crawford: Geopolitical instability is not new, especially in these countries that we're talking about, that's not new. That's been around for decades. So how are you protecting yourself and the stakeholders, whether it's investors, employees, customers, how are you ensuring that you're protecting and ensuring that your business is gonna be sustainable through these rough patches? It's great when things are working right, but that's not always the case for any business. And so we just have to think through how we're managing that and what levers we can pull when it's time to make those shifts.
0:26:40.3 Yadin Porter De León: Yeah, I think your point on the black swan is interesting because as humans, and this is where we get back to that human factor too, as humans, there's a lack I think sometimes of responsibility for preparing for certain things that don't happen often. If it's not right in front of, I don't need to bring it into my thought process, and if something like a pandemic happens, I'm off the hook because I can label it as a black swan. It's like, "Oh, that's something that we didn't prepare for because we didn't have the budget to prepare for it, the people to prepare for it." When really as an organization, especially as a technology leader, I'm sure there's a lot who are advocates of these types of things that you need to be able to have in order to create a sustainable business, one that's gonna last 200, 300 years.
0:27:18.8 Yadin Porter De León: If that's what your goal is, hopefully, not just last through the next quarter, you're gonna have to start thinking about these things, and then some of those things will have technology solutions. Once you get through the thought process, then that's where it happens at the end, is where the technology is applied and not, "Let's throw AI at it," or, "Let's throw Cloud at it." No, let's actually walk through what we wanna do and how we're gonna be a sustainable business too, 'cause humans, they're annoyed when they have to do fire drills and fires are relatively common. And so how annoyed are people when they have to come up with a pandemic plan and what do they do and how are you gonna be able to support people.
0:27:50.4 Yadin Porter De León: And someone says, "Hey, look, we just came up with this great pandemic plan in 2018, and I need another 150,000 or 250,000 to upgrade this particular capability so that if we have everyone working remotely, everyone doesn't have to go through the VPN, through our main server and try to go out again and just break everything." And they're like, "Yeah, I know that 250,000 would be helpful for that situation, but that's never gonna happen." And then two years later, somebody will actually have come out with a story of like all of a sudden everyone's VPN-ing through our main server and it's just breaking and we're completely not working, those who had sort of, whether it's a cloud or multi-cloud or SaaS products were able to function better, but that was driven by different things, not, "We need to be a sustainable business."
0:28:27.6 Tim Crawford: You're absolutely right, and it requires a couple of things to kinda play out. Even if you don't have the money to upgrade that VPN server, you can still go through the process, the thought process to ensure that, okay, if we start to see certain things happen, certain triggers happen, this is one of the things we're gonna need to drop some serious coin on in a moment's notice, because we're not gonna be the only ones that are gonna be gunning for that technology and there's gonna be a run on the technology.
0:28:57.4 Yadin Porter De León: No, that's right. I'm glad you put that out because it is. I think you can do that, you don't have to spend it proactively, you can say, "Look, just park it here, make sure that you know we're gonna have to do this in this scenario, in this pandemic plan, we're gonna have to scale this particular thing up and it's gonna cost X. Do we wanna spend X later or do we wanna spend Y now?"
0:29:13.7 Tim Crawford: That's right. But there's another piece here that is maybe a learning opportunity for most IT organizations, and I've had the opportunity to assess a number more IT orgs than I've led. And one of the things that I've seen over the course of my career has been that disaster recovery and business continuity is probably one of the biggest risks within the IT organization. It's one of the things that gets the least amount of attention, and it has the potential of the biggest impact should something go sideways. And it doesn't have to be technology failure.
0:29:51.8 Yadin Porter De León: A lot of people look at it as insurance though, and that's wanting to put in that insurance box, then all of a sudden now everyone looks at it differently, and the economics of that are just terrible. And maybe that's one of those internal marketing things that stuck.
0:30:01.9 Tim Crawford: But I think that's where... It's just another of several indicators of where you have to think about the bigger picture. The second thing you have to also consider is when you're looking at these ways to create sustainability within your business, you have to understand what your business is, you have to understand that your business is not just you make pants and shirts, but your business is people, it's an organization, it's an ecosystem. You have to understand how all of these different pieces within that supply chain, within that value chain to the customer, how they all tie together. It can't just be, "Okay, I know the quote to cash process," and check the box and I'm done. You have to understand what is the time frame to get something from contract manufacturing all the way into the customer's hands?
0:30:52.4 Tim Crawford: Like what are some of these pieces and how does our company actually operate? The sad part about this is, historically, IT orgs don't understand that. They might at the more senior levels, but when you start to get into mid-managers and especially into junior folks, they might know a very small piece of it, but they really don't understand the big picture. And so the problem with this is you start to get really siloed. Now, more mature organizations are starting to recognize this problem, and they're starting to figure out ways to get them more into understanding how their business functions and the role they play within that, and what they're doing, how that ties into what the company is doing.
0:31:39.2 Yadin Porter De León: Yeah. It's tough though, 'cause you gotta have an individual who really wants to know that, they wanna do ride alongs, they wanna know more about that process, and then their organization does incentive that.
0:31:47.8 Tim Crawford: That's right.
0:31:47.9 Yadin Porter De León: And even if they do have that knowledge, that and they present it at a meeting or a call, they're like, "Yeah, yeah, I know, but we need to work on this piece or this one app or this one connector or this one server, let's not muddy the waters with what is the user experience," when that's exactly the kind of conversation they should be having.
0:32:03.7 Tim Crawford: Well, I mean, you're absolutely right. But the problem is, we still have a number of IT organizations that their cost centers, they're seen as the folks you call when the projector is broken, when I can't get to the Internet, call IT, call the CIO, they're the ones to get involved. They're not the ones that you're calling when it's like, "Hey, we wanna go into a totally different direction with our business, we need the CIO to sit in that discussion. We can't have that discussion without the CIO being present." But...
0:32:35.4 Yadin Porter De León: And it just, it seems like this is such an old conversation and it's still not there yet. They're still not there.
0:32:40.5 Tim Crawford: Well, hold on. There's another piece to this. So one is recognizing that needs to happen, but the second is ensuring that you have an IT leader that is capable of engaging in that conversation. And unfortunately that does not exist across the board. And so you have this situation where you have CIOs that absolutely, they could be the CEO of the company and they would be able to take it in great directions, no problem, and then you've got CIOs that they're really operating more to VP of IT, Director of IT kind of mindset and it's more transactional. It's not strategic. And that has to change. It has to change from both sides. The company has to recognize the value of the CIO and IT, and IT has to change their culture, and the CIO has to change their tone and cadence if you will, an engagement to be able to bring that closer together.
0:33:37.7 Yadin Porter De León: And then that's how you actually pull in the, "Hey, how can technology enable the business to be sustainable in all these different ways?"
0:33:44.1 Tim Crawford: Yeah.
0:33:44.5 Yadin Porter De León: But you have to have a technology leader who can see how that sustainability needs to manifest from a business perspective.
0:33:50.9 Tim Crawford: That's right, that's right. I mean, just to ask a CIO, "Tell me all the different ways that you could make your business sustainable." Just full stop, right there. And if they're just focused on, "Well, we can save energy here," and that's where they go to, that kinda tells you something. As opposed to understanding all of the different ways that sustainability ties into a company's health.
0:34:17.6 Yadin Porter De León: Yep, absolutely. I think at this point, I think it's good to transition to our last topic, which is one of the other emerging sort of conversations that's happening. A very hotly contested topic as well. So we're getting a little spicy here, when you bring this up too a lot, there's gonna be a lot of opinions on this, and that's what is the office for? [laughter] Why do we want everybody to come in? And there's a lot of different things, there's emotional, there's economical, there's productivity. I'm gonna start just, from just a base sort of foundation here. From a productivity standpoint, there's been a lot of a hotly debated, "Well, people are more productive if they're in the office."
0:34:55.9 Yadin Porter De León: And I think there was a really great point that was brought up in the study that Microsoft released. I think they did a really great comprehensive piece, but one of the things that really stood out, and they actually, they did a call out, a big call out on this, and they said they found that 85% of leaders here, think about this as leaders, say that the shift to hybrid work has made it challenging to have confidence that the employees are being productive. That's a big call out. So what the problem is there, we have problems with leaders being confident that the employees are productive, not that there's a lack of productivity. And so I'm gonna pitch that over to you, Tim, to kick that off to talk about... [laughter]
0:35:37.0 Tim Crawford: Sounds a lot like trust.
0:35:38.6 Yadin Porter De León: It does. So, and this sort of is... Well, we're talking about this like from a CIO perspective, because I feel like there's already a really, I think a good idea that from a technology perspective, it's very easy to have people to code remotely, to service servers remotely. You have to have the remote access to a lot of these things in order to be able to function as an IT organization. But at the same time, you need to be able to see your people, sometimes the managers, they need to be able to see them, see what they're doing, are they here, are they talking. And I guess really we're framing this conversation from sort of why we think this emerging sort of trend in conversation is sort of saying an aggregate, like more companies need to bring people back into the office, even after we proved that for three plus years that people can be really highly effective. What are those conversations with the people you're talking to look like?
0:36:30.8 Tim Crawford: Yeah, and this just came up again in conversation couple of times this week alone. This is a regular recurring conversation for me. Like what are other people doing? How are they running through these challenges that we're having and articulating the challenges? Let's take the extremes off the table first, one, we know what it's like when everybody is in the office, right? That was the model prior to 2020. Most of the people are in the office, you might have a couple of stragglers that are remote or hybrid, but most of the people are in the office. Going into 2020, we shifted that where everyone was in remote, right? Everybody abandoned the office, went full remote.
0:37:13.1 Tim Crawford: When you're in those two extremes, it's pretty easy to manage the engagement on many different levels. When you start to talk about some people are in the office, some people are remote, and you have significant portions that are in this hybrid mode, you start to run into social issues, you start to run into collaboration issues, but you also start to run into management issues. And I'm gonna separate management from leadership, 'cause to me, this is not leadership, it's management. When you wanna make sure that someone is sitting at their desk, sitting in front of their computer, and that's your focal point, making sure that the mouse is moving, right?
0:37:54.7 Tim Crawford: There are tools now that will physically move your mouse so that it looks like you're actually doing something to get around some of these tools, that's management, that's supervisory, that's not leadership. You're focused on the individual doing something, not focused on the output of what they're doing. And that's the difference that I think we have to get through. And to your point, there is a lack of trust around that. I've been in conversations with executives that have said, "I don't trust that people are really doing work." These are real conversations. "I don't trust that people are actually doing work unless they're in the office. They're goofing off, they're doing something else. They're kind of sort of working while they're doing something else."
0:38:41.4 Yadin Porter De León: They are watching ESPN, they're doing something else. 'Cause...
0:38:43.8 Tim Crawford: Yeah. But they're not dedicated to the job. They're not dedicated to the work that they're being paid to do.
0:38:49.4 Yadin Porter De León: They didn't have a way to measure output. They just have a way to measure physical presence. And there's always the idea of like, "Well, if they do the output that I asked them to do, maybe they could have done more if I saw them."
[chuckle]
0:39:02.3 Tim Crawford: Right. And this is where you start to see some of the big tech companies, and I can't recall which one, so I don't wanna misquote one, but one in particular that they were finding that they asked people to come into the office, whatever it was, two days a week, three days a week. And they were tracking people's badge access. And if you didn't come in those two or three days a week physically where your badge got scanned into an office, then you were gonna get warned and potentially have disciplinary action. And I think the problem here is we're focusing on the wrong thing. We're not focused as leaders on the output of, I pay Tim to do a certain job. That job is not sitting at his desk in front of a computer. That job is producing some sort of output. And so how do we start to reorganize our thinking to be able to shift into that mindset? So that's one dynamic that has to change.
0:40:01.5 Yadin Porter De León: But wait. One second. Let me just... One second. 'Cause I think that's, I mean, it's a good point, but at the same time people say, I get this output. Okay, you got output X, but there's the trepidation or the worry that output X could have been, I don't know, X plus two or X times two if they were in the office, like the quality, they're questioning too, like maybe the quality could have been better. I just wanted to sort of out that too because there's a lot of people who do measure output, they do say like, great, but they feel like the output would be better if everyone was just in the office collaborating, talking to each other, kind of sitting next to each other whiteboarding and stuff like that.
0:40:35.0 Tim Crawford: It's a hypothesis. It's because we weren't measuring it before. And so it's a hypothesis based on a belief. And you do see this, I'm gonna bring age into the mix, but you do see this with older generations of leaders, they tend to slide more toward people have to be in the office. When you start to come off of those more senior folks from an age perspective into the next generation, there's less of a focus around that. But there's another piece that you have to talk about in the same vein. I don't think you can separate the two, but there's a social and an operational aspect too.
0:41:15.7 Tim Crawford: When you went into an office, you had a desk, you set it up the way that you were comfortable working. Monitors were set up a certain way, I had my coffee cup, my pens, my pencils, whatever, my notebook. And so when you come in, you sit down and you can get right to work. With hoteling where you have a temporary desk, in some cases you have to make sure that you have a desk available because this is another problem that some companies are running into, is people want to come in on a specific day and there are no desks available on that day. There are on other days, but not that day.
0:41:52.3 Yadin Porter De León: Just sit on the couch. [chuckle]
0:41:53.6 Tim Crawford: So now there's a logistical problem. And now maybe I'm in a part of the office that I'm not around my team that is working or, and this is another scenario that I'm seeing playing out. I came into the office, but that particular day, I'm spending the entire day on Zoom or Teams calls. So why did I come into the office? Like why did I spend an hour, hour and a half each way commuting into the office, giving up two to three hours of my life sitting in a car, contributing to the carbon footprint by doing that commute and my stress level only to get on Teams or Zoom calls. And so there's a logistical and a social aspect that we have to kind of think through. I don't know that there's necessarily a great answer to this, but we have to try out some of these methods and try and figure out, okay, what's gonna work best for the culture of that team, of that organization? And then try and resolve some of these issues amongst that group, amongst that population.
0:43:03.8 Yadin Porter De León: Yeah. I think having that thought experiment, that thoughtful approach to that. And then there's all sorts of, of course technology solutions that work very, very well. But we have to, like you said Tim, we have to address sort of the emotional, the beliefs, the hypothesis, the existential question of do I feel like I'm being an effective manager if I don't see people right next to me? Or can I trust that the individuals are doing what they're doing and we have all these tools to ensure that I'm in communication, that we can collaborate, we can do all this great stuff.
0:43:34.8 Tim Crawford: Right. And we have to get rid of the noise that is driving some of these narratives too. So for example, there was a story earlier this year, I think it was earlier this year, about how companies are putting monitoring software on people's computers as a way to kind of figure out what they're doing. At the time that it came out, I was standing in front of two CIOs. These are prominent CIOs, both of them with publicly traded companies, I'll leave the names to the side. And we were having a conversation about this particular article and what people are actually doing. And they were both really frustrated by the article 'cause it went down this path of companies are monitoring employees and it's an invasion of privacy and they're not trusting employees and blah, blah blah. And both of the CIOs were just really passionate. Like, "That is so not true. It's so not what we're doing."
0:44:29.7 Tim Crawford: They both had monitoring software that they deployed. One of them said, "Look, I do this. We do it very transparently. It's an opt-in. It helps you understand where you're spending your time so it can help guide you, but it's totally transparent. People know what we're doing. We don't hide any of it." The other CIO said, "We do it within our sales organization and we actually track what all of our sales folks do. Again, very transparently, here's what we're doing, here's why we're doing it, to understand the behaviors of the top performing sales reps." And then they publish that and say, "The top 1% do X, Y, and Z. They respond to certain number of people a day. They're focused on these aspects, they're finding success with these products." And they publish that in a way that then other sales reps can choose, okay, do I wanna follow that path and try some of those things or not?
0:45:30.4 Tim Crawford: Now, to me as an employee, that sounds okay, but that's not what people think about when they think, "Oh my god, there's monitoring software and people are gonna use it for nefarious purposes. They're gonna see what I'm doing. I happen to be surfing Amazon in the last few days 'cause it's prime day," that sort of thing. So I do think that we have to be transparent when we're using tools. And this kind of ties right back to our earlier conversation around Generative AI. But we have to be transparent when we're using tools and help people understand what we're trying to accomplish and have them take part in the conversation. And I think that will actually help them get more engaged when we talk about what is an office for? When should we use an office? When should we not use an office? What about our colleagues that are just starting out in their career and they're sitting in their studio apartment and have no interaction with anyone other than through a Brady Bunch screen?
0:46:30.9 Tim Crawford: And so how do you start to help guide them and mentor them and have them experience the water cooler talk that the rest of us that have been in, in our careers 20, 30, 40 years have been able to learn from? And then what happens to those folks that are more extrovert? And so they actually really struggle to be stuck behind a screen. They want that personal interaction with other people. And so the point here is that the human condition is a really complex animal. And we have to really understand how and why we would take certain actions. It's not about the office or not office. The office is just a tool. But we have to figure out how people can work best within their team, within that culture, within that company, again, to the bigger picture of why we're all here. And then figure out what are the best ways to use the tools in an appropriate fashion. But I think it's a much more complicated conversation than people let it on to be.
0:47:37.7 Yadin Porter De León: It is. And then people, I think, or that the issues are coming up when people are being draconian and they're being binary.
0:47:41.9 Tim Crawford: They absolutely are.
0:47:43.0 Yadin Porter De León: And you have to ask two questions, which are I think key, which are boiled down to really, if you're gonna do something, use a tool, like an office, who is it for and what is it for? And then once you answer that, you say, well then how do you know it's working? And if you answer those questions, then you're starting on a different path rather than I feel like we need to do X. Well, many organizations are run that way, but there's a better way. So Tim, great conversation. Why don't you let everybody know where they can find you, listen to you, find out what you're doing, what you're working on, hear more about your thoughts and and where can people look you up out in the internets and the interwebs and the Metaverse?
0:48:19.2 Tim Crawford: Yeah. [laughter] I'm pretty easy to find, Tim Crawford on LinkedIn. I post a lot on LinkedIn. I'm on the different social platforms as well. And then you can also find my blog at avoa.com.
0:48:33.5 Yadin Porter De León: Well, fabulous. Tim, thanks for joining the CIO Exchange podcast.
0:48:37.1 Tim Crawford: Thanks for having me. Enjoyed the conversation.
0:48:40.4 S3: Thank you for listening to this latest episode. Please consider subscribing to the show on Apple Podcasts, Spotify, or wherever you get your podcasts. And for more insights from technology leaders as well as global research on key topics, visit vmware.com/cio.
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