What Is the CIO’s Role?

Dr. Michael Kranz, CIO of ThyssenKrupp Steel Europe

SAP.info: In 2010, you were nominated to the list of Top 10 CIOs of the year by  CIO magazine based on your project record of establishing service orientation in IT to better support business goals. How have you seen the role of CIO change over the last 10 years?

Dr. Michael Kranz: I think the CIO’s role has always been to bridge business on one side and IT on the other. When you are able to close the gap in the right way, you end up with solutions that improve the business. That’s my understanding of a CIO. Has it changed over the decade? Personally, I would say not.

What technologies do you value most right now as the strategic advisor for IT at ThyssenKrupp Steel Europe?

One important enabling technology is the handling of big data. SAP has of course a product called HANA in this area but there are other technologies around as well. The challenge is how can we transform data into information and how can we make sure that this occurs on an appropriate company level.

It could be a vision, for example, that in a meeting you not only have a Microsoft PowerPoint presentation, you also have an interactive screen where you input a question or data and you get immediate real-time results. Depending on those results the system then also points proactively to other areas that are worth looking at. So we will be able to have more dynamic online meetings, where you have a quicker way for making better and more accurate decisions.

Another thing is all-around collaborative technology – how to enable people to communicate better than with just email. I am not proposing an email-free company. I would say this is not realistic. There might be a good combination of different collaboration solutions for a specific purpose, and they are available stationary as well as mobile, seamlessly, around the globe.

You have a reputation for being a very engaged CIO. In 2008, you joined other CIOs at a press conference to voice frustration with SAP’s service. Since then, what changes have you noticed from Walldorf, and what areas can SAP still improve upon?

This 2008 scenario was a good example of how powerful a CIO community could be. At this time, there was no other way to say to SAP what are the customer’s requirements. Fortunately, SAP has learned from that and changed in the right way. We have a good relationship here and a good connection with the German SAP User Group (DSAG). We have a CIO council there with high recognition from SAP management. I would say the communication is well established.

At the beginning of my engagement with my former employer, I started working with the IBU SAP for Industrial Machinery & Components, so I know the Executive Advisory Councils of SAP, which are a very good platform to bring customers and SAP together. I like the professional relationship with SAP. Sometimes there are some problems – this is normal – and then this connectivity helps to make sure that there is a win-win solution at the end.

Talent management is a critical topic for many companies at the moment. HR specialist Rainer Strack of Boston Consulting Group has told us that Germany will face an especially difficult situation in the global talent wars, losing around 1.2% headcount every year between 2020 and 2030 (see The Recruiting Crisis). Where is this subject on your radar? As a CIO what are you doing to prepare for this eventual talent crunch?

We are going to discuss those issues in one of the areas of activity in the Integrated IT team that we have at ThyssenKrupp Steel Europe. This team is comprised of IT people, HR people, and people from the business departments. We are discussing some scenarios and ways forward on how to handle the new challenges. We are going to use structured approaches to make sure, for example, when we meet with our employees in the yearly people-development process, that what we discuss with the people about what their path should be fit to the company’s needs and to their own ideas.

If we understand that there will be fewer people, we also have to align our sourcing approaches to this and make sure that we have the people on board – and now I close that loop – that understand the bridge between business and IT. I think this is a core knowledge IT should have.

With the current global uncertainty and Euro-zone tensions, where are you planning to concentrate your IT investments in the next 1-3 years?

The IT investments will mainly go to two areas. One is the modernization of the infrastructure – one of our strategy fields on a ThyssenKrupp AG corporate-wide basis. The other one is called data and process harmonization and is of course more important, but you need the infrastructure investment as a foundation. We want to enhance and improve our business processes with a best-fit IT solution, especially in the core process areas of order-to-cash and purchase-to-pay. This is what we want to enable ThyssenKrupp Steel Europe going forward within the next 1-3 years. So the main investments are in those two areas.

What mobile device do you carry?

Dr. Michael Kranz (smiles): That’s a good question. Currently I have two. I distinguish between a business device and a private device. Often people like to have one device for both, but I personally don’t like to clutter things up. So, I have an Apple iPhone privately and I have a Blackberry for business.

What we are looking at in the company on a corporate level is not a Bring-Your-Own-Device strategy but to open a broader but standardized and secured spectrum. SAP’s solutions like Afaria and SUP can help to manage this new portfolio.