Ron Kifer is the group vice president and CIO, Applied Materials, a leading nano-manufacturing technology solutions provider. The company offers a broad portfolio of innovative equipment, service and software products for the fabrication of semiconductor chips, flat panels, solar photovoltaic cells, flexible electronics and energy efficient glass. Before joining Applied in May 2006, Kifer spent 5 years with DHL Express in various executive management roles, most recently as the senior vice president and CIO for North America, Asia Pacific and Emerging Markets. Ron Kifer talks exclusively to Sudesh Prasad of Dataquest about the changing role of the CIO and other issues. Excerpts:

How has the role of IT at Applied Materials changed over the years?
IT's role at Applied Materials has come a long way from the earlier focus entirely on bottomline, cost reduction, and sustaining and maintaining business enablement. We want to play more of a strategic role in management of IT and we are accomplishing that. We are doing that through business transformation and through IT transformation for a high performing value add. Our company has got to be a market leading world class organization that has the benefit of world class IT. And there are tremendous opportunities at Applied Materials. If we do things that we are going to do around business enablement, building real core competencies, change leadership, and business process optimization we have to value IT, and I think our company's senior leadership is beginning to understand that.

What according to you is an ideal CIO expected to do?
There are certain traditional things that CIOs are expected to do-deliver stable production services, application system availability, manage information risk, ensure business continuity. The role, however, is dramatically expanding. The CIO is now expected to provide leadership support, business process optimization, and vendor enterprise service management, and also business transformation initiatives because IT is the thread that runs through the entire business. CIOs have to find ways to fund business enablement. Budgets will continue to be constrained and they have to create mechanisms for resource optimization, taking the cost out to be able to re-allocate those resources to business enablement and change initiatives. This can be done through managed services to reduce RoI.

"We have been able to cut our cost by over 30% by using managed services. It is not just for the purpose of having that money back into the organization but also to reinvest that money for a competitive advantage"

What will a NextGen CIO be like?
The NextGen CIO will be an equal, strategic partner. There will be a blurring of lines between business and IT, and IT would just be another functional area of the business. There will be increased respect for IT's ability to drive competitive advantage and to support the topline of the organization-not just the bottomline-through cost reduction.

How challenging is the role of CIOs in the fast changing IT and communications technology landscape?
As CIOs roles become more strategic and business focused, their function would increasingly include forming a team of professionals who are responsibile for technology innovation-to make sure they understand the opportunities available in emerging technologies, to network with academic institutions and organizations, to deliver competitive advantage to the organization...

What new challenge does the tremendous growth of wireless bring to CIOs?
Enterprises are going to become more mobile in the future, and we'll have to ensure integrity of information and intellectual property-that will become very challenging.

Are you in favor of enterprises outsourcing their IT Infrastructure?
It is a critical component of our overall IT strategy. We want to focus our internal resources on core value-add business enabling activities, change leadership, project portfolio management, architecture, etc. We want to outsource those components which only an outsourced provider can provide-not just skilled resources but also process maturity, the tool and the matrix. This has to be a very strategic and well managed relationship. As we evolve our own internal capability and continue to evolve our own knowledge management capabilities, the managed service providers will have to do the same thing.

We have been able to cut our cost by over 30% by using managed services. It is not just for the purpose of having that money back into the organization but also to reinvest that money for a competitive advantage.

Which are some of the emerging technologies that will have an impact on enterprise?
Technology is just a tool and enterprises have to decide the best way to use those technologies in overall strategy for the advantage of the organization. New technologies are a challenge for us to leverage their capabilities. SOA is one technology which has not lived up to its hype but I think the potential is there, and it is also part of our strategy for reengineering our business processes and implementing end-to-end SAP ERP to eliminate 70% of our legacies. We will use SOA to leverage the remainder of those legacies.

Page(s)   1