Anthony Malakian: An Offer Technologists Can’t Refuse

A valuable trait to have in journalism is a skeptical ear—one tends to be fed a lot of half-truths and outright falsities in this profession. As I noted in my case study of State Street Global Advisors (SSgA), which will be available online next week, technologists want to believe that they’re valued by the business leaders—the head trader, the chief investment officer and, of course, the CEO. And any smart institution will value those individuals, the back-office heroes.

The point of that feature, though, was to show, from a business-user’s perspective, how one firm has tied itself to its technology department to figure out how best to handle the influx of data it faces, and how it has gone about consolidating systems in order to create a flexible organization. It’s an example of business desires leading technology decisions.

Increasingly, I’ve heard about IT and the business working in lock-step—a smooth, collaborative entity where everyone is equal. This view was espoused recently at the Buy-Side Technology European Summit. This is perhaps a CTO’s dream of a utopian society, but one only has to look at the pay scales of business leaders and technologists—and also where budgets are directed—to see that equality-for-all is not the true mantra of the day.

As far as I can tell, the traders and portfolio managers are still the driving force of systems and software investment—with regulators rounding out the Holy Trinity—at most buy-side firms, and that’s not a bad thing.

A Trusted Consigliere
Consider this: CTOs and chief information officers want to have an equal say as to the implementations that they oversee. In order to make that happen, there needs to be a lot of meetings with the chief investment officer and head traders. Now, those investment officers and traders have their own wish lists. They must run their requests by the COOs, CFOs and legal departments. Then, everyone comes together with the CEO and in most cases the executive committee to hash out their ideas and decide who will get what. That’s a lot of meetings and equality that needs to filter throughout an organization.

Stop portraying business and IT as equals. Technology provides the tools to execute on the business’ ideas.

My suggestion is this: Stop portraying business and IT as equals. Technology provides the tools to execute on the business’ ideas; it seems silly for business leaders to have to have an equal voice alongside technology. What’s important is that IT has an ear in the room, rather than a full-throated retort when these decisions are being made.

Numerous Meetings
Chris Rice, SSgA’s global head of trading, says he’s had numerous meetings where business leaders sat around and discussed strategy, and after the meetings John Wysocki, SSgA’s head of trading technology, would advise Rice on what was possible and what might be a stretch.

“I bring our technology team in on everything we do because everything we do is technology-enabled,” Rice says. “Bringing that team into the business and having them involved with every conversation is essential. I walk out of a lot of my staff meetings and John will say, ‘I heard what you guys were talking about and maybe you should think about it like this,’ and he’ll turn my thinking and I’ll say, ‘You know what, you’re right.’ I’m a bit fanatical about it—we’re very tightly enmeshed with IT.”

That’s collaboration at its best. If you have smart technologists with an ear in the room, collaboration is possible. The head of technology should be viewed as Tom Hagen, a character from The Godfather—as everything in life, for me, relates to that film. Hagen was “consigliere,” or advisor, to crime boss Don Vito Corleone.

If the traders run the shop, that firm will eventually find itself in trouble with regulators and/or investors. You can’t just tell IT to sit in the corner—technologists need to have input, if not ultimate decision-making power. Sometimes there will be friction as to the best way to go about a new project, but if technologists are trusted and smart, then there isn’t any real need to pretend that they’re on equal footing. That’s not a bad thing—it’s reality.