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Articles

November 2006

by Elizabeth M. Ferrarini

 

CNN has expanded its reach to include nine cable and satellite television networks; two radio networks; four Web sites, including CNN.com, the first major news and information Web site; CNN Mobile and CNN Newsource, the world's most extensively syndicated news service. Turner, part of the Time Warner family of media companies, is also home to familiar cable TV networks such as TBS, TNT, Cartoon Network, and Turner Classic Movies, as well as specialized networks such as Boomerang.

 

Because of the diverse nature of the Turner family of businesses, Scott Teissler, Turner's chief information officer and chief technology officer, has the ultimate challenge of weighing technological advances versus understanding and fulfilling the needs of the advertising community. Teissler, the former senior vice president of new media strategy and chief technology officer for CNN, recently sat down with Enterpriseleadership.org to discuss how his organization pushes the technology envelope so Turner businesses always have a competitive edge. Here's what he had to say:

 

EL: Apparently, your IT organization doesn't meet the conventional structure for IT departments. Can you explain how things are set up?

 

ST: About 2,000 people report to me. What we call "IT" is organized in a consolidated technology unit, comprised of IT software development, IT infrastructure, new media software development, research and development, and broadcast technology. The entire organization shares these IT resources. The business units don't have independent technology establishments.

 

EL: Given the diverse nature of the Turner businesses, what types of customers do you have to deal with regularly and how do you make technology decisions about what's best for them?

 

ST: We have several different types of customers for our principal business, or what we call "linear networks." The primary customers consist of our distribution affiliates and satellite operators. They know how they want to evolve their services and present them to consumers. We have to be aware of their strategies, and they have to do the same.

 

Another group of customers are the ad agencies and the advertisers. They are interested in both how we're evolving our presentation capabilities within our linear products and within our networks. They're also interested in the kinds of collateral possibilities we have for presenting advertising in our new media products.

 

Our new media business has mostly advertising customers. Here, we go directly to our audience with the package through our distribution affiliates. We have a number of decisions to make about how to track the technical developments and strategies for these different groups. We also need to realize that they all have plans and notions about how their platforms will evolve. To this end, we have to stay current with those marketplaces and the technical evolutions occurring in them. We can't afford to make price decisions based on the marketplace.

 

EL: Since you have such a diverse IT organization, what does your  governance model look like?

 

ST: We're lucky at Turner. Members of the senior management team communicate very well with each other, and also trust each other. It's a stable organization. These qualities make the technology governance process more practical.

 

Most CIOs or CTOs indirectly report to everyone who runs the overall business. What you do is part of their strategy. If you over-formalize or isolate IT governance by quarter or month, you miss out on a lot of interaction with these people. The best way to handle IT governance consists of giving general management a lot of exposure to all layers of IT. Make them participants who can drill down into the IT organizations.

 

EL: Since you don't have a formal governance model, how do you gauge the  success of IT with the business units?

 

ST: You have to look at how the businesses that technology supports are doing. Our mainstream businesses tend to be number one and number two in their category, and we have an outstanding reputation for advertising support and deal stewardship. Users give high marks to our new products, such as CNN Pipeline. So, we can conclude that everyone is doing a good job, especially in the area of product development and support. Measuring problems with back-office systems requires a lot of probing. Two organizations might be delivering great support. On the other hand, one organization might be consuming more capital because it's hyper-refining some applications. It's tough to determine when the line has been crossed.

 

EL: Do you use any type of best practices, such as CobIT or Six  Sigma?

 

ST: We're aware of the science that best practices entail. However, we don't practice specific ones, chapter and verse. We're not obsessed with obtaining certification in a particular method. Why? Best practices tend to spawn industries, consisting of a software science that uses big claims to get people to use the practice uncritically.

 

We have a good program in product management discipline, we pay a lot of attention to our software development methodology, and we use cutting-edge methods. There's a positive feedback relationship between using such methods and tracking the most interesting talent in the marketplace.

 

In summary, we're trying to extract what's best intellectually from those standards and to adopt them without becoming converts to a specific one.

 

EL: You're both the CIO and CTO at Turner Broadcasting. Is this the IT  norm at the other Time Warner companies?

 

ST: Years ago we abandoned the single company-wide CIO and CTO. Each business now has a CIO and or a CTO. Our small committee of these executives meet regularly.  I chair the CTO committee; someone else chairs the CIO committee.

 

Time Warner corporate has about 100 employees who mainly engage in strategy and coordinating some activities across the companies. Operating governance occurs in each business. activities across thecompanies.  The operating governance of the company occurs in the big individual units.  Practically all of the Time Warner companies are number one or two in their industries.  That's the level each CIO and CTO has to focus on.

 

The CTO group, for example, has one challenging mission -- to make sure that general management around the company, including Time Warner and its divisions, can navigate the digital landscape ahead him or her. Digital leadership, which we call it, consists of having executives you can devise and carry out successful technology strategies.

 

To explain contingencies adequately, CTOs have the daunting task of separating policy from strategy and also from marketplace development. Many of the strategic problems don't lend themselves to consensus solutions. The CTO has to explain things to general management so it's not frustrating for both sides.

 

EL: What disruptive or innovative technologies are you considering for  your business units? Anything that really stands out?

 

ST: We have a lot of things going on. Wireless, however, ranks at the top of the list for us. For example, CNN has had a long history of product development for wireless platforms. In fact, CNN News is probably the most widely distributed wireless in the world among cellphone operators.

 

You might say that wireless will become the next generation of broadband, without a lot of broadband's current limitations. Wireless is going to be faster, less expense, and to support more programming functions than today's broadband.

 

Today's consumers turn over wireless handsets every two years. It's a completely global enterprise. There's an enormous scope still for product development and service development. All of the Time Warner businesses will use it and benefit from it. Turner has content, especially news, suited to this small form factor.

 

Something else we're looking at is how advertisers will change the nature of the selling progress. Many of the new e-commerce platforms have given us better methods for measuring the delivery of advertising-type material. Now advertisers and their agencies are finally getting smarter about how to measure their success.

 

Within the next five, to 10 years, ad-supported businesses will see a change in the way we measure our success and our ability to sell advertisers. Things are going to become more complicated, granular, and perspective. This change in how people look at advertising campaigns is going to affect a lot of big businesses.

 

EL: Do you have an innovation team or innovation centers?

 

ST: We have two parallel organizations. Platform R&D pumps knowledge into the company from external sources. This group just doesn't talk about new products, but develops and deploys prototypes. In contrast, the new products group filters ideas in order to steer resources to pre-business development efforts. Platform R&D gets ideas generated from the new products group.

 

We don't have such centers scattered around the country. Our platform R&D group will support permanent digital field trials. We'll program new content on personal video devices, and then hand them out to a panel of consumers for their review. These field trials serve as a resource to our ad sales business units, which have relationships with the advertisers and their agencies.

 

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Elizabeth M. Ferrarini is a free-lance technology writer from Boston,  Massachusetts.

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by Elizabeth M. Ferrarini

 

As one of the world's largest producers and distributors of flooring for residential and commercial applications, Mohawk Industries operates a large and complex business made up on 19 acquisitions since 1990. The company offers its 30,000 customers a broad line of premier carpet, ceramic tile, natural stone, and home products. In 2005, the company did more than $6 billion in revenues and acquired a Belgian company, which does about $1 billion in sales.

 

Mohawk is a vertically integrated company with 56 manufacturing locations, 56 warehouses and distribution locations, 256 sales centers that distribute products to the wholesale channel, and a transportation infrastructure of 2,000 trucks and trailers. Each business line is a start-to-finish production process. For example, the laminate floor process begins with wood chips and ends with the finished product. As a result, the IT organization must actively be involved at all levels of the company's business and strategies, down from the office of the chairman to workers on the plant floor.

 

Recently, Don Riley, CIO of Mohawk Industries since 2004, sat down with Enterpriseleadership.org to discuss the creative ways he keeps IT flexible and supportive of the company's growth.

 

EL: Can you describe some of your key applications and  systems?

 

DR: The IT organization handles everything internally, except for running the mainframe -- IBM handles that. A large component of the operation runs on fully redundant AS400s. The storage area network received an award from Storage Networking World, the major enterprise storage tradeshow, and our data centers have a good base of core technologies.

 

We also have best-of-breed, core legacy applications that provide a degree of sophistication for transportation, distribution, planning, and business. We standardized by line of business and created the concept of a global infrastructure model. We commoditized the infrastructure layers and regionalized the application layers as appropriate. By migrating all of our domestic locations to AT&T, we can leverage their links, which has been very successful for us.

 

EL: How is IT keeping the company competitive?

 

DR: First, we created a support structure that integrated key personnel with the business. We worked with them on what their challenges, issues, and long-term business strategies were, and we sat in on their sessions on business strategy to find out where they're headed in the next few years. Next, we told them the areas where we could help them facilitate and achieve their goals.

 

We've already taken on several initiatives that support the sales and marketing penetration strategy that the business has for the next several years. These initiatives will help them deliver capabilities and functionalities needed to compete in a specific channel more effectively. Along a similar line, we want to get a greater return on investment for  our sales force. So, we have initiatives that will focus on sales force productivity. Similar initiatives for manufacturing will focus on working capital or cost of goods sold.

 

Once we have the strategic direction, then we can carry out day-to-day processes that help track whether we are investing the appropriate amount of time to get those things accomplished.

 

EL:  Are you doing balanced scorecard to gauge how well IT is aligned  with the business units?

 

DR: We have an IT dashboard that drives and supports the business, and we map our  strategic initiatives to support that within IT. Next, we preplan our strategic business projects tied to the overall business strategy. The dashboard shows how we are performing on a reliability and quality basis for daily work. It also tells us how we are performing relative to our strategic IT initiatives and our major projects that help to move the dial forward for the company. We share this information with both the business units and IT team to keep everyone focused on improvement.

 

EL: Do you have other best practices besides the  dashboard?

 

DR: We're carrying out a full-scale project management office. It will help to audit our large initiatives to make sure they stay on track. We're taking the applications development team through level one to level three CMMI training.

 

EL:  What is your governance model?

 

DR: For each major line of business, I've created a relationship manager who functions as a CIO for that business. These managers are responsible for ensuring that we're providing the services the business units should be receiving, and the projects are being  accomplished on time and within budget. On top of that, our executive steering committee, which consists of the chairman's direct reports, meets quarterly, and I facilitate this committee. We have monthly sessions by key line of businesses or process areas where we review priorities.

 

EL:  Have you had any significant reductions or productivity  improvements?

 

DR: We've made material improvements in productivity, quality, and overall reliability. Because we've become more cost effective, I've been able to operate more efficiently with the resources I’ve had since I took this position. In terms of manpower numbers, this is the leanest shop I've worked in. I spent 12 years with EDS and eight years in the apparel industry prior to coming here.

 

EL: What innovative technologies are you considering for the next  year?

 

DR: We're excited about what cellular carriers are trying to do with hot points, WIMAX, and 802.11, and how the PC and PDA companies are trying to take advantage of that. We see developments helping us in customer services, sales, and the support side relative to taking advantage of some of that.

 

We're also interested in business process modeling analysis and management and its relationship to the service-oriented architecture. It can help us migrate to a more agile architecture where we can adjust processes on the fly more quickly.

 

We're taken advantage of blade servers and plan to take advantage of grid  computing.

 

EL: What role does business intelligence play in your  organization?

 

DR: We've made investments in front-end sales analysis and reporting. In fact, it will also become a key component of our longer-term strategy as we become more global and enter more regions. It will enable us to tie all of these regions together in a quick, efficient manner, and to report our performance to the company and to the market.

 

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Elizabeth M.  Ferrarini is a free-lance technology writer from Boston,  Massachusetts.

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