Selling the pipes

ONE OF THE MOST difficult management challenges for a CTO is achieving a balance between building IT long-term infrastructure and taking a shorter-term view to meet pressing revenue needs. This challenge goes to the heart of what a CTO deals with every day on both strategic and tactical levels. CTOs must leverage technology to drive revenue in the short term while building valuable long-term IT infrastructure within the company, all while motivating employees and managing the relationship with the CEO.

The job of the CTO is analogous to that of a general contractor. When a contractor builds a house, no one gets excited about the plumbing or electrical wiring, but it's essential to the construction of a house. Everyone is ready to get to the point of choosing paint for the bedroom, or faucets for the kitchen. The customer is never excited about spending money on pipes, but the contractor knows that no water will flow out of those faucets in the kitchen without them.

So the contractor works quietly on the plumbing and tries to hold the anxious new homeowners at bay as they press him to begin talking about cosmetic issues. The contractor juggles the long-term view with minutia constantly. In the end, the contractor must focus on infrastructure above all else -- it's easy to change faucets and paint, but redoing the plumbing after a house is completed is a nightmare. This is why the CTO must keep the short-term demands of customers in balance with building scalable infrastructure.

Selling infrastructure projects to CEOs in challenging economic times is difficult for most CTOs in light of recent history. The conventional wisdom that you find in The Wall Street Journal, BusinessWeek, and other business press suggests that the current economic malaise within the tech industry is largely due to a glut of infrastructure purchases during the tech boom. A CEO listening to his CTO talk about budget allocations for infrastructure might be thinking, "Didn't we build all of our infrastructure out in 1999 and 2000?"

True, in most companies a lot of money was spent on infrastructure during the boom, but with questionable results in many cases. In all the focus on the amount of money spent during the boom, I have noticed one issue is consistently overlooked: During those times, talent was spread so thin across many industries that poor design decisions were often made by inexperienced architects and shaky infrastructure was built by inexperienced developers. (An aside: A cynical CTO might think that the rise of Web services is built solely on the promise of gluing together all the patchwork systems that were built during the dot-com years.) The CTO must make sure that his CEO understands that continued investment in infrastructure is necessary to undo some of the technology sins of the past. The only way to get this investment is to successfully tie your infrastructure project directly to revenue. If the investment can't be justified very compellingly in the context of revenue, then there is a high likelihood that the project will be placed firmly on the back burner. As the CTO begins to see wins and builds credibility from successful infrastructure investments, this process becomes much simpler.

From a staff management standpoint, the CTO must juggle maintaining the motivation of his engineering staff with the immediate needs of the business. Engineers enjoy building stable and elegant infrastructure, but CEOs often want to see short-term results that require technology compromises. The CTO has to manage these two different motivations, making sure that the engineers are happy and solid infrastructure is being built while delivering revenue for the company and the CEO.