blog Most businesses tend to see their IT department as a cost centre, and allocate funds to it accordingly. But with most industries being rapidly affected by technological change, many companies are starting to realise that bringing their chief information officer in to their strategy meetings can have a big impact. The CIO of ING Direct, Andrew Henderson, has some interesting comments on the matter over at the PicNet blog:

“CIOs can contribute to the generation of revenue by ensuring that they maintain close relationships with their business counterparts. It is crucial for the effective utilisation of technology, that CIOs and their team are able to bring the potential of technology to the table very early in the gestation of a new idea. This allows time for the value proposition to be developed, but also gives the business the chance to fully leverage the power they have in their ICT teams.”

The most switched on CIOs these days that I speak to don’t speak of themselves as being part of an IT department or focused on IT — in fact, much of the IT actually fades into the background, as they’re constantly talking about their company and its aims, not the IT department’s aims ;)

Of course, in practice much IT department work is still focused on technical outcomes. But IT seems to work best when it’s part of the entire organisation’s strategy rather than in a world of its own.

Image credit: Jay Lopez, royalty free

Related posts:

1. Oh dear: How many Aussie CIOs did NOT buy an iPad?
2. Australian CIOs optimistic about future
3. The transformation journey: Why CIOs take it on

According to statements issued to the Australian Securities Exchange this morning ahead of the company’s results briefing in Sydney, Telstra’s total revenue for the period sank 2.9 per cent compared with the same six months to the end of 2008. Total sales revenue was $12.34 billion.

Earnings before interest, depreciation, amortisation and taxation (EBITDA) were also down by 0.3 per cent to $5.32 billion, although once the sales of the company’s IT services business KAZ to Fujitsu last year was taken out of the equation along with currency movements, EBITDA looked a little better, 0.2 per cent up.

But the real winner in the results was Telstra’s free cash flow, which jumped from $1.91 billion in the half to the end of 2008 to $2.62 billion at the end of 2009 – a figure 37 per cent up.

The company said it was experiencing “challenging market conditions”, with revenue from its traditional fixed-line telephony business (the public switched telephony network or PSTN) dropping by $222 million compared with the previous corresponding period.

The “PSTN headwinds have increased,” the company said in its management presentation. Revenue from advertising and Telstra’s directories business (contained within Sensis) was also down by $53 million.

Revenue from mobile services, however, was growing strongly – up $145 million, as the telco continued to capitalise on its leadership in the field with its Next G network.

The amount of people signing up for new broadband connections on Telstra’s network was also decreasing, with the telco saying the fixed broadband market was “maturing”. However, the number of mobile-only households – households without a fixed connection at all – was growing rapidly each six months.

In terms of guidance for the 2010 financial year as a whole, Telstra said it expected a low single digit decline in total sales revenue, with EBITDA growth set to experience low single digit growth.

With regards to its ongoing negotiations with the Federal Government and the National Broadband Network Company regarding the NBN, Telstra said only in its briefing document that the talks “continue”.

Further coverage throughout the day.

Related posts:

1. Telstra continues financial stagnation
2. ‘Financial gap’ opens up in Telstra NBN talks
3. Show us your Telstra deal, Optus tells NBN Co