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In 1831, two observant Frenchmen, Alexis de Tocqueville and Gustave de Beaumont, spent 271 days in America. One of their first observations was, "Nothing is more striking to the European traveler in the United States than the absence of what we term ... government." In the 1830s, you didn't see police or military in the streets, and you rarely heard talk of laws and regulations in the parlor, saloon or a place of business. Today, it's still rare to see police or military in the streets. But even the casual observer cannot help but be struck by the amount of ink, the number of pixels and the time spent discussing the role of law in our society. This month's CIO Habitat examines the collision of the legal and IT worlds.
Speaking late at night and only on deep background, most CIOs admit that this legal stuff is the third rail of IT leadership. As one CIO put it, it's a "ticking bomb waiting to go off."
It wasn't always so. Many CIOs think back wistfully to just five years ago when they didn't worry much about the legal dimensions of IT work. Most recall the days when they didn't spend much time with -- and frequently had no relationship with -- their organization's legal counsel. When they did get involved in legal issues, CIOs did so for contract negotiation, licensing and contract maintenance, and personnel issues (see Figure 1).
Today, these issues haven't disappeared; instead they have been joined by a host of new, more complex and potentially value-destroying concerns (see Figure 2). "The first half of my career, there was virtually nothing that required us to involve lawyers," says the CIO at a California-based durable goods manufacturer. "The growth in security, privacy, SOX [Sarbanes-Oxley], whistleblower, etc., has had a big impact on IT."
A senior IT person on loan to the supply chain organization at a large manufacturer sums up the situation elegantly: "There are many, many new ways to get into trouble now."
The program manager for SOX compliance at a multinational manufacturer is emphatic that the legal side of IT is big and growing. "My every move is controlled by the law and lawyers," she says. Some readers might attribute this to her role. But the increasing legal responsibilities of the IT profession are not the result of an isolated act of Congress. The SOX compliance manager, who was previously responsible for support systems like HR and finance, notes that regulations in general have proliferated. "New regulations are changing the way we do business."
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