California appoints first cabinet-level state CIO, raises bar on IT

Pressured by lobbyists, Gov. Arnold Schwarzenegger appoints veteran IT exec Teresa Takai as the Golden State's first statewide CIO. Better haul out that suit of armor, say analysts.

The importance of CIOs to organizations won a big endorsement last week, with the appointment by Gov. Arnold Schwarzenegger of California's first statewide CIO. The cabinet-level position went to Teresa "Teri" M. Takai, who was CIO of Michigan and has served as director of the Michigan Department of Information Technology since 2003.

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"Two years ago, I introduced my Strategic Growth Plan to rebuild and improve California's crumbling infrastructure. But, our state's infrastructure isn't limited to the physical roads, bridges and levees that need repair. We also have to expand and improve California's technology to meet our future needs," Schwarzenegger said in his Dec. 6 announcement.

The position was created by a bill sponsored by technology trade group American Electronics Association (AeA), whose members had "grown frustrated by their inability to offer IT products and services to the California government," said AeA's Roxanne Gould, senior vice president, California government and public affairs. "This is a significant achievement for California and our member companies. AeA pursued this piece of legislation because the high-tech industry believes an empowered State CIO will have the ability to make California less risk averse where buying technology is concerned."

Potholes

A victory for IT, the job is both a tremendous opportunity and a political minefield, said analysts and headhunters who closely follow the public sector.

"When you think about the size of the economy of California, the real opportunity to both save money and improve efficiency by using IT as a linchpin is huge," said Bobby Cameron, a principal analyst at Forrester Research Inc. in Cambridge, Mass.

Prior to Takai's appointment, IT strategy for California was determined in large part at the local and state agency level. IT troubleshooters such as J. Clark Kelso were summoned as interim CIOs in times of crisis. Unlike the stints of the temporary workers who preceded her, Takai's role is backed by new legislation granting her the power and funds to show taxpayers what California's $6 billon annual spending on IT can really do, if used wisely.

Other state CIOs with smaller budgets are driving efficiencies by bringing "process-driven" IT to state governments," Cameron said.

In Utah, for example, a new governor came in, appointed a new CIO and is radically transforming how government operates, using IT as a lever. The aim is to move to a process-driven approach to state business, as opposed to departmental. "It wasn't just cut the cost of buying PCs, but let's run the government better," Cameron said.

But a radical realignment of that kind is "fraught with potholes," Cameron added, because a large part of IT behavior in a government organization is encumbered by legislation. Sometimes, a change in IT spending requires a change in laws, meaning the state CIO is a de facto political player.

William Willis, the deputy state CIO of North Carolina, has proved adept in the rough-and-tumble political workplace by taking the carrot approach to winning turf battles, Cameron said. Willis, a former professor at North Carolina State University in Raleigh, had worked as consultant to the finance committee in the state legislature, reviewing the IT-related budgets.

"Being an academic, having been an external consultant, having a noninvested view, he's come in and done things like statewide procurement for customers down to the county level," Cameron said. "The result has been that entities like local boards of education feel like they have no choice but to follow the lead of the state CIO, because it saves them so gaddarn much money."

But other CIOS have not fared as well in what has become a highly politicized job. The forced resignation of former Massachusetts CIO Peter Quinn after his unsuccessful battle with some members of the state legislature (and Microsoft) over adopting the OpenDocument Format is perhaps the most high-profile example.

Desperate situations

Headhunter Martha Heller said that what makes the CIO role so challenging is the dizzying number of skills a CIO must possess to succeed: from an appreciation for the technology and the organization to the ability to deal with a constituency that may not understand the technology or the price of technology.

"Take those challenges and just increase them exponentially in a state and government role," Heller said. Tenure for state CIOs tends to be shorter. A change in administration may mean the CIO is gone before the benefits of the technology he or she fought for are realized. The IT talent wars afflicting all organizations are even more brutal for government IT, where the pay is not as high. In California, with its surfeit of high-tech companies, competition for good employees is fierce.

The real opportunity to both save money and improve efficiency by using IT as
a linchpin
is huge.

Bobby Cameron
principal analystForrester Research Inc.

In addition to the political savvy and the tactical smarts state CIOs need to possess, next year brings its own special challenge, said Doug Robinson, executive director of the National Association of State Chief Information Officers (NASCIO).

A slowing economy will mean IT spending could rank pretty low on the totem pole of budget priorities. Gov. Schwarzenegger's statement notwithstanding, a renewed emphasis on aging physical infrastructure -- the nation's bridges, for example -- will make financial negotiations even tougher for CIOs, Robinson said, citing a Dec. 5 report from the National Governors Association. Dropping property values and federal cuts in health care augur major fiscal challenges in 2008.

"We're looking at some pretty desperate situations because of major shortfalls, especially in states like Florida and Virginia," he said.

The kicker: No one doubts that Takai is up to the task. Robinson, who knows Takai well from her years as a member of NASCIO, says she is a big believer in doing the political footwork to form alliances internally and externally to get things done.

Prior to her stint as Michigan's CIO, Takai's work included extensive experience in the commercial sector, including executive positions at Ford Motor Co. and Electronic Data Systems Corp. Takai previously served as president of NASCIO and is currently chair of the Harvard Policy Group on Network-Enabled Services and Government. She was named public official of the year in 2005 by Governing magazine and she appeared on the Crain's Detroit Business list of the 100 most influential women. She received a bachelor's degree in mathematics from the University of Michigan, and holds a master's degree in management from the University of Michigan. Learn more in Takai's full biography

Let us know what you think about the story; email: Linda Tucci, Senior News Writer.

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