In this episode of Solving Problems with Xalt, Xalt Solutions’ industry specialist, Geoff Wakefield, interviews the team at TAG CXO on the idea of problem solving versus selling and the importance of having the right technology leader within the organisation to ensure a successful digital transformation.
GW: Hello and thank you for tuning into this episode of Solving Problems with Xalt on HxGN Radio. I’m your host, Geoff Wakefield. On today’s podcast, we have Paul Theisen and Zach Poth from TAG CXO on with us to talk about technology leadership and having the right leader in a technology-facing role.
Paul, Zach, thank you for joining us today. You guys are from TAG CXO and as some of our listeners may not really know much about TAG CXO, why don’t you tell us what you do and what your roles are at TAG CXO and how you help your customers.
PT: Sounds good. I’ll jump in; Zach, you can follow up.
So, Geoff, thank you so much for having us today. It’s a pleasure to be with you. TAG CXO is a company that provides former large company CIO executives to mid-market firms on a fractional interim basis. So, let’s break that down a little bit. We take former executives that are battle tested, trained in industry. They’re industry veterans, so to speak. They’re not career consultants; they’re career executives, and they’re looking to retire or are semi-retired or are retired, and they’re looking to take on, you know, portfolio careers, where they take on what they want to, and they want to give back. They want to take their career experience and they want to help take that hindsight and provide it to clients to be their foresight. And so, we find that that translation works really well when you bring that down into the mid-market firm because the mid-market operators, there’s so many more mid-market operators compared to enterprise operators.
So why the mid-market? Well, I mean, we’ll talk to anybody that wants some good technology executive advice. It doesn’t matter if you’re enterprise, mid-market or small, we’ll talk to anybody because everybody needs the same help. But the mid-market particularly has a talent vacuum when it comes to executive leadership in the technology ranks. So, anybody that would be a technology executive, a CIO, a security officer or chief information security officer or chief technology officer, those are typically the three C titles that would carry technology executives a generic C title.
You know, mid-market companies are surrounded by technology expertise at all kinds of levels, right? They have software vendors, they have employees, they have specialists, they have consultants. They’re surrounded by a lot of experts, engineers, application developers, specialists in ERP and business systems. I mean, they’re all over the place, right? The one expertise that they don’t necessarily all have and most of them don’t is a technology executive expertise.
Well, what does a technology executive bring that all of the other individual experts don’t? They bring the opportunity to manage technology as an operation, as an organisation at the company and to develop and run the operating model that provides all the IT services out to the business, all the internal and external customers, anybody in their ecosystem that would consume the services that are generated by a company’s IT department. The CIO, the executive level person is responsible and accountable to make sure that that whole operating model is running in a sustainable way, that it’s scalable, that it’s running efficiently, it’s running holistically, and that it’s predictable, right? There’s a whole basket of services that have to go on day in and day out. They have to be ultra-predictable, right? That’s the bread and butter. You know, the help desk has to answer the phone and the systems must run right and downtime is not tolerated on tier one services and so on and so forth.
But a technology executive provides the whole scope of view and the experience to build out the entire operating model known as the IT department. So, it’s the people right, which includes the full time employees, the part time consultants, the partners in their ecosystem, the software vendors and hardware vendors and solution providers they surround themselves with. So, it’s all of the people in the ecosystem. It’s all of the processes and policies and procedures that a department follows, which collectively you could call governance right. What are the rules that we play by and all of these scenarios and are people educated to those rules and maybe most importantly, are those rules enforced? Is there some governance model that ensures enforcement of that? And then last but not least, is the technology stack, right? All of the software solutions you use, the hardware solutions you use. So, you have people process technology and those are surrounded by strategy. How do you align that basket of IT services to the company’s revenue generating model and their efficiency model? So, their sales line and also their below the cost line. So, one is revenue and sales generation, and the other one is cost efficiency, cost savings. And so how do we align with that as a department?
Then that necessarily defines our budget, our operating budgets and our capital budgets. So, you take your strategy, your budgets, your people, your processes, your technology and you put senior leadership over that that knows how to build that operating model and balance it all out and make it run in a healthy, sustainable and scalable way that is aligned with the objectives of the business, right? And so that’s what CIO brings, which most individual contributors in an IT shop do not bring that, that level of insight. Certainly, they don’t bring that level of tenure. And all of the players that are in the C-suite currently or chief executive, your chief operating, your chief financial officer, chief marketing officer, chief human resources officer and the titles go on, there’s a lot of chiefs in the C-suite but very little technology executive expertise among those C-titles because they just haven’t invested heavily in that role.
And many of those companies are not ready to open up a whole new C-level role. Sign them up as a fiduciary card-carrying officer of the company, you know, carving out equity or profit sharing and, you know, various things that you do at the executive level for comp packages and so on. We advise them many times, don’t do that yet, so they’re caught in between. They’re not ready for a full time CIO, but they need more than just an IT manager or in some cases, an IT director. So, they’re caught in the middle.
So, what we provide them is 100 percent of the enterprise level executive technology skills 25 percent of the time on a fractional basis. That’s completely flip flopped from what they all currently have access to, which is a plethora of expertise on a full-time basis. But none of it is 100 percent qualified at the executive level. So, they’ve got fractional skill sets 100 percent of the time. We offer them 100 percent of the skill sets in a fractional amount of time, on a part time basis.
We fill that expertise void at the executive level and we really help them set strategies, set roadmaps, understand what questions to ask, what answers to listen for. Our hindsight truly becomes their foresight. And that is the main offering that we provide at TAG CXO is coming in to be that fractional executive in a space that they are not experts in.
I’m the founder of that and I am formerly a CIO. I was head of IT throughout my career, most of my career. So, I’m a former CIO recruiting CIOs to penetrate and provide a value, add service to a market space that I think is underserved with their offering.
So, Zach, that’s what I do and what we do. What’s your take? What do you think?
ZP: Well, you said it well. Geoff, thank you so much again for just thinking of us and wanting us to jump on this podcast with you. So, thank you for that.
Where I fit in to TAG, Geoff, is on the operations side. You know, in my past career as I came in on the business development sales piece and I just realised that there were gaps between the sales and business development arm and some of the product or service delivery piece. And so, what I started doing was that as I would sell these products and services, I realised that the teams aren’t able to deliver on what my sales were. And so therefore I started fixing the problems I found within the operations and helping these different departments work closely together.
So fast forward to 2020, jumping on board with Paul, I’ve come in there to help kind of build the foundational blocks for him to be successful and all of our delivery executives. So that’s where I fit in into the TAG environment.
Love being a part of TAG. I love what we stand for. I love the individuals we work with. I interact with some very, very smart people. I glean a lot of wisdom and knowledge from them. I get to see that poured into the companies and clients that we work with. So that’s where I come in. And I get to pour my passion out into TAG. I work with Paul and other delivery executives alike, so.
GW: Yeah, that’s great. It sounds like you guys do some really great work in helping people get the right leader in place to make those decisions that could affect the whole company, right, whether it’s at small, medium or enterprise level company. But who typically reaches out to you and says, “Hey, we need help”? How does someone come to find you guys?
PT: Yeah. Well, certainly referrals are very, very meaningful to us. But you know, the typical buyer of our services are other executives that are already in the C-suite, right? Yes, you know, oftentimes you’ll find, particularly in a mid-market space where the CFO is the sponsoring or accountable executive for IT services in an organisation. And oftentimes we can come alongside a CFO and really help them gain clarity on what it is they have that they’re responsible for, right? Their expertise is in finance and accounting and treasury and banking relationships and, you know, syndicated finance packages, you know, loan packages and all kinds of things that they bring to the table, their ability to interpret results and put pressure on various areas of the business from a financial perspective. We want to come alongside them and be a support to them so that they can manage IT more effectively and more confidently. In fact, we like to say we give our clients three things over and over and over. Our job is to help our clients gain the clarity that they need to invest their dollars more wisely and manage their IT operations more confidently.
So in that scenario, we are a decision support mechanism. We are helping to drive the assessments, drive the gap analysis, prioritise the work, codify and classify the findings into, small, medium and large complexity sets, understand where the low hanging fruit is, what the costs are going to be, what the options are that are available to them, the recommended path that we would take given the options and the constraints and so on. So, we want to net all of that out for them, just like we are a CIO, right? Because we are. We’re a fractional CIO, but we want to communicate it in a way that they can see it, understand it, make decisions against it. And if they have the clarity they need, they can make a better investment decision. And if they have the clarity they need with a better investment decision, after implementation, they can manage the operation much, much more confidently because they have the clarity that they need.
One of the things we provide often is we end up in scenarios where we end up coaching the sponsoring C-level executive. It could be the CEO, CO, CFO most of the time. We coach that person. What questions to ask when you’re in IT meetings, what answers the listen for, principles to live by, things that you can rely on over and over. We want to coach them to be CIO-like, right?
And then we’ll turn around, we’ll mentor kind of the IT managers, IT directors, how to communicate better in the C-suite, you know, how to present your findings, how to create collateral that they can interpret and understand, right? And so on. So, we end up in coaching relationships with the executives and mentoring relationships with a lot of the managers. And so, we really liaise in that way.
The C-level players are the ones that generally reach out and say, you know, we’ve got an initiative, we’ve got an M&A situation, we’ve got good old fashioned optimisation because, like, we’ve got a client now. We’ve got five devices in the hands of every field worker. We need to collapse that down to one. We need efficiency, but, boy, if we could gain those efficiencies, we’d really like to get ahead of the market and create a competitive advantage. So, they’re reaching out because they’re in situation A and they envision they want to be in situation B. You know, it just depends. You know, they’re why is varied, but it’s typically you can settle it down into, we’re not where we want to be and we don’t know what the right next move is, and we’re not sure who to trust. And so, we help them understand that a battle-tested executive is probably more trustworthy than a bunch of relationships that have something to sell you in the way of a solution. Right?
GW: So how do you build that trust? I mean, do you ever tell people that they’re not the right fit for you, that it’s not going to be, you’re not the right solution or coach for their problem?
PT: Yeah. I think that that naturally happens in the process of getting to know an organisation as well. We have to align our expectations and abilities right from the outset. So yes, we absolutely have walked away from work that doesn’t fit because they either didn’t really have the need or we diagnosed something different or they weren’t as far along the path of allowing another executive to come in or they sought, you know, it was maybe two transformative for them. So, you have to diagnose, where is a customer at in their journey and what are they really looking for? It’s a balancing act between selling them what they are asking for and advising them on what they need. And sometimes you can do that before the sale happens. Sometimes you have to move towards that after the sale happens and you become more trusted and more influential as a member of the team.
But one of the reasons that they trust us out of the gate is because of the pedigree that we bring to the table. We bring credibility to the table. We’re not career consultants. We are not software salespeople. We, our very first core value is that we are impartial by design. So, when you come, we’re not selling. We’re solving. And the only way you can solve is to understand requirements because requirements beget options and options beget solutions and solutions beget recommendations. And so, we’re not selling, we’re solving. And we’re solving with their logo on there and sitting on their side of the table. We’re working for them. We sit on their side of the table. So, if they’re ready for that, it’s magic. If they really just want a vendor relationship and not a co-executive relationship, it’s not the right fit.
GW: And so, for the people that are the right fit, this may be a little bit of an ambiguous question, but what’s the ROI for having the right technology leader in a company?
PT: What’s the ROI for any executive role, right? What’s the ROI for the CFO? What’s the ROI for the COO? We know that we can’t live without them, but it’s really hard to evaluate them. But we give them large six figure salaries, profit sharing, and equity packages all the time. And I think that it takes a while. The proof is in the pudding, right? What are the ultimate results? When you read an executive’s resumé, what are the identifiable, practical, objective accomplishments? What have they contributed to former organisations and to their existing organisation? And you have to value that. You have to put a value on that and determine if it’s meaningful for your current context.
So, one of the things we bring to the table, Geoff, is that we have literally spent hundreds of millions of dollars of other companies’ money throughout the duration of our careers and we’ve made up, that’s a very, very expensive education on somebody else’s dime. Right?
PT: Now when I say our hindsight becomes your foresight, that’s the thrust of that. We earned, you know, those stripes that we have with all of the successes. But for every one of those successes have been some things in our past that we’re not bragging about, you know, that were mistakes, that were lessons learnt, and those were on somebody else’s dime. Well, we’re not going to make those mistakes again. That’s what makes our advice so valuable going forward. It’s not just, look at all the great things I did and we can do the same thing for you. It’s, let me help you navigate the minefield and don’t make some of the same mistakes that I made, because, you know, I’m down a couple notches and you don’t have to be, right? And so, we can steer, we can steer that way too. We can steer them towards our successes, at the same time steer them away from some of our mistakes. And we’re humbled that way.
So, you know, we’re bringing that to the C-suite, just like anybody else that’s already in the C-suite that that client already has. Everybody’s got a rap sheet, right? And everybody’s got hindsight. Most of them just don’t have a rap sheet with a technology exec attached to it. Those are the decisions that are ambiguous and confusing. And to be quite candid, they have some insecurity around because they lack the confidence to drive hard because they feel like they’re not in control of that, you know? So, we want to hand them the keys to their own city and make them feel like they have control and give them clarity. So that’s what our hindsight brings to them.
GW: No, and that makes a lot of sense. And, you know, to relate that to some of what we see at Hexagon Xalt Solutions, we walk into companies that have either tried to go through a digital transformation and failed or don’t know where to start. And a lot of times that’s because they don’t have the right, you know, technology leader or at least the right people supporting their leaders from a technology standpoint. So digital transformation being, you know, something that seems to be very common these days with a lot of companies, it’s the buzz word, it’s the thing that everyone’s going after, how does having the right technology leader result in a more successful digital transformation in a business?
PT: Let me—I’ll net it out two different ways. One is USDA. Don’t let me, make me come back to that. USDA, you can remember that. USDA. And the other one is this, I want to talk about this operating model because nothing exists in a vacuum, right? You don’t put new services down and it exists all by itself. Everything works as a member of the operating whole, a holistic perspective. And whenever you’re introducing new services that people are going to consume and they’re going to demand and they’re going to be satisfied with and they’re going to be delighted with and they’re going to say, how did we ever live without this? Then those new services, those delightful services are going to have to coexist along with everything else the IT operation already does, right. We have to have, you know, don’t go to war if you haven’t counted the cost, right? You know, how to ramp up provisions, and you need to know how to sustain troops, right? That comes from battle-tested experience. How to ramp up and how to sustain troops, that comes from experience. If you don’t know how to ramp that up, give it to a professional that knows how to manage the whole, not just the part, right. That’s option one.
The other thing is a simple look. Solution implementation, and we say this over and over, implementation is not the goal. It’s a milestone event. On time and on budget are important milestones in an implementation, but they are not the ultimate goal. And so, when companies stop short of the ultimate goal and all they do is on time, on budget, they get an implementation. Implementation equals money spent. The goal is solution adoption. So, you’ve got to get all the way through to solution adoption to gain that for which to gain the benefits that you set out to get. Benefits that you set out to get are not realised at the day of implementation or go live. They’re realised months later, after the firm is benefiting from all of the tools they put in place, the solution they put in place, is adopted and being used successfully within the organisation. Implementation equals money spent. Adoption equals money made, benefits gained, benefits realised.
The difference is oftentimes culture, right? That’s where this hindsight becomes our clients’ foresight. The way to get stuff adopted in the hands of people that have to use it over and over is to meet them where they’re at. So, we use a simple little model called USDA. You know, we stole it from the United States Department of Agriculture. We’re not paying them any royalties. But we call it Useful, Simple, Dependable, and Accessible.
So, anything you put in front of a user, is it a useful solution? Yes or no? Simple as that. Is it useful? Is it actually benefiting them in some way? Because if it’s not, you’re automating the wrong thing.
You know, is it simple? Because if it’s not, they’ll go back to tried and true methods that they like that are less complex or even more complex, but easier understood and more fully understood, right? People love familiarity. If it’s not simple, they’re just not going to be interested. Right?
Then it has to be dependable. It doesn’t matter how useful and how simple it is. If it’s not dependable, people will get frustrated, you’ll have a reputation for not being dependable, and people will go back to tried and true methods. Tried and true methods are your enemy of digital transfer. Tried and true is the enemy of digital transformation. It just is. You know—
GW: The way we’ve always done it is my least favourite word to hear.
PT: —way we’ve always done it. Tried and true. You know, that’s paper and pen. Or, you know, whatever it is. It might be suboptimal, but it’s dependable, right? And not underestimate dependable.
But last, but not least, as is your solution accessible? Now what does that mean? It kind of sounds like dependable, available. Is it accessible? Is it within arm’s reach? Does it live on my phone? Is it in my pocket? Is it on my iPad on the seat of my car or the seat of my truck? Is it at my desk in front of my computer screen? You know? Does it exist on the media that I interact with? And are the tools and the media that I interact with, with me wherever I am? Well, the answer to that is yes. But people move across environments. They move from an office to a car, from a car to a chair, you know, to a table at lunch, to the back seat of an Uber. It goes on and on and on, right? These are the environments that we live in. Is my solution useful? Is it simple? Is it dependable? Is it in my pocket? Is it within one arm’s reach of where I am at all times? Because that’s what accessible means.
And used to be in the old days, the phone book used to be, the yellow pages used to be advertised as the one that gets used, you know? And it was always within arm’s reach. It was always in the kitchen cupboard or the kitchen drawer or whatever. Well, today that’s your mobile device. It’s your mobile device.
So, if any one of those four attributes fades away, your adoption, also fades away.
GW: That sounds like a great model to cheque against, any solution, whether it’s a complete, digital transformation of an entire business or if it’s a very specific thing that’s being changed.
PT: Absolutely. You can use it broadly. You can use it narrow. You can use it within a sprint, in development. You can use it for the entire product release. It’s just, it’s a simple way to gain subjective feedback and push it through an objective model that says, let’s be honest with one another, you know, because stuff doesn’t get adopted because you spent the money on implementation. That’s not why it gets adopted. It’s not the right solution because you spent millions of dollars on it. It’s the right solution because it works for people.
GW: It reminds me of a story. It’s probably a fictitious story about the toothpaste factory. And so, there’s this toothpaste factory that had a problem. They were shipping boxes of toothpaste that didn’t have the tube of toothpaste inside of it. They go and they spend millions of dollars on a system that puts a little scale at the end of their production line. And if it doesn’t have the right weight, an alarm sounds, the line stops. So, they spend millions of dollars on consultants and implementation, and they go, it’s launch day. It’s working right. Everyone’s happy. They’re seeing some numbers. Hey, we rejected this many, that many, and everyone’s happy.
Well, few months go by. They want to go cheque on it because they see that the number of alarms has gone down to zero. They’re not triggering anything anymore. And they go walk by the line and they see a box fan set up right before the scale that sounds the alarm, stops the line. As they stand there, they’re watching boxes blow off the line from a $20 box fan, right? That solved the problem. At least solved the symptoms because they really didn’t get to root cause. They spent millions of dollars on consulting, on resources only to find a solution that was better was $20, right? Of course, they should get to the root cause, but that seems to be the problem with adopting the wrong thing, because we spent so much money. It’s the sunk cost and we’re going to keep doing it despite it not being the right solution.
PT: We commit ourselves to paths of error because we’re invested in it, but no digital transformation programme was ever successful by that definition. Right. We don’t commit to a path of error just because we’re invested in it. I mean, that’s led to abysmal failures. So that’s why I love the new development environment with agile. You know, your time box, your solution development in both time and money. You put it in a box that’s manageable. And you know, you can throw it away if you miss the mark. You know, they’re like bricks; one brick was bad, I threw it out of the pile. I put another one on. You know, I don’t build a whole house and then stand back to judge whether I met the mark. I’m literally measuring that brick by brick. Right? And it’s just a much more effective way to do it.
I love your manufacturing methodology. The story that I’ve always heard, when you want to take Toyota for examples of high quality and all that, you can take the bad parts out of the end of the line so that you don’t deliver them to the client. Right? And that would be a successful outcome to improve client quality or customer quality numbers. Or you can re-engineer the process that’s creating the defective parts so that you make a lot fewer defective parts, right? And that costs a lot less money to make better parts than it does to clean up bad parts so your customers never see them.
GW: We follow the principle for cost of quality or cost of poor quality, that it’s a dollar to fix it at the source, $10 to fix it before it leaves, and $100 to fix it in the field.
PT: Well, it’s having three months software bugs, right? Software bugs, they say by the time they go general availability, it’s a thousand x to repair them in terms of cost. You know, that’s why you want to get it done before it leaves code review within the developer shop. It’s absolutely amazing, it’s fascinating.
So, what do our executives bring? We bring that insight. We bring that perspective. We bring those 40 years of applying successes to a business and enduring our hard-won mistakes. You know, the life lessons that we’ll never repeat on somebody else’s behalf, not on our watch, so to speak. Yeah.
GW: So, as we start to wrap up, you know, just if people, Paul and Zach, want to learn more about TAG CXO or connect with either of you, what’s the best way for them to do that?
PT: Well, certainly you can hit our website and all of our contact information is on there. Plus, it shows what we do and who we do it for and so on, and that’s Tagcxo.com. Very simple. Go there and look us up. Give us a phone call on our business line, 602.962.6200, and we’d be delighted to talk to you about your project, your initiative, your need for leadership. Yeah. And you know, we’ll just talk to you about your need. Absolutely. So, reach out on either the phone or on the website. You can hit us that way. Our emails out there as well paul@tagcxo and Zach@tagcxo. Any of those methods, reach out. We’d be delighted to help.
GW: And we’ll make sure to put that in our podcast notes when we publish it on our website. But thank you so much for being on today. It’s very clear that you guys have the experience as technology leaders, and that’s what you bring to your customers. And from the Hexagon Xalt side, it’s been great to learn a lot more about user adoption, and we could probably do a whole segment just on that. So, a lot of good knowledge that you guys have shared with us.
PT: Yeah. Geoff, thank you for providing a forum to get together and talk about these things. Quality leadership is so important. I think mid-market firms don’t need to carve out a whole position all the time. They just need to go on a fractional basis and get what they need to have. But the key is get all the skills that you need to have on a fractionalised basis. And I would love to come back and talk more about solution adoption in low code, no code platforms and in the future of software development and why it’s changing the game for citizen developers and end users companies because it’s, you’re absolutely right. What you guys are doing at Hexagon is going to do for software development what virtualization did for servers 15 years ago, you know, to the data centre. You know what virtualization did to the data centre, your company is doing for software development. It’s fascinating. Love to talk more about that.
GW: Well, folks, you heard it here. It sounds like we’ll get Paul and Zach back on for an additional podcast, so stay tuned for that.
For anyone looking to learn more about this podcast series or listen to other episodes, you can visit us at hxgnspotlight.com under HxGN Radio or listen to episodes on SoundCloud or Spotify via HxGN Radio. Thank you for listening and we’ll see you next time on Solving Problems with Xalt.