Mr Technology 

CXO meets Centrica’s new influential CIO Gareth Lewis to find out how IT is providing the power behind 21st century business.

In the not-so-glamorous world of IT Gareth Lewis is seen as a mover and shaker. With a plethora of IT experience under his belt, as well as being a regular fixture on websites listing the most innovative and influential IT leaders, he knows the business inside out. Although he only stepped into his role at Centrica last November, CXO finds a man exuding enthusiasm for the challenge ahead during a chat recently at the energy firm’s corporate headquarters in Windsor, near London. He’s been busy too. “As any new CIO in the mythical 100 day period there is a process of diagnosis, synthesis of options and redirection,” Lewis notes. He has also re-organised the central team at the business to bring a “sharper focus” to both the delivery of shared services and the governance and architecture of the whole information systems (IS) function. “It is a work in progress but we will see material results as we progress through the rest of 2008 and have already made significant strides in some specific areas.”

So what first attracted the energy giant to this technology boss? Well, he has been on the radar of global business for a number of years now. Within IT circles, he is best known for making multi-million euro cost savings whilst establishing a host of new businesses in his previous position as group CIO for all of Virgin’s brands. On paper, it still looks a mammoth role. The task of tying all of the diverse IT functions together and improving customer experience across Virgin’s 200 companies – everything from soft drinks, planes and music to cars, holidays and bridal wear – came under his remit. Virgin boss Sir Richard Branson made Cambridge-educated Lewis the group’s first CIO in 2002 after a brief stint as CTO.

Whilst chatting openly about his old job he recalls how the expansion of the telecoms arm of the business occupied a good chunk of his time. “I spent six years with Virgin which was tremendously good fun and had the opportunity of helping to establish most of their mobile business in all parts of the group from South Africa to Canada and various points in between.” 

IT challenges
It is probably no surprise to learn that his time spent at Virgin threw up some of his biggest technology challenges to date. But as Lewis is quick to point out, “the biggest is not necessarily the most difficult”. “Clearly with some systems scale needs to be taken into account, but perhaps the question is one of complexity rather than scale.” After a quick pause for thought Lewis recalls his work at KPMG with a leading Dutch broadband supplier BBned. “Probably the most complex was this almost fully automated wholesale broadband operation,” says Lewis. “Although not large, because of the complexity of processes through multiple systems, it was quite complex.  However, one could take in all the Virgin mobile companies around the world and point to both innovation of architecture and high degrees of complexity. Each one has its own peculiarities, with one specifically looking more like a real time banking operation than a traditional phone company.”

Prior to the Virgin job, he was a partner at KPMG, where he established the firm’s telecoms systems integration across Europe. As a graduate, Lewis always had visions of embarking on a career based around the management of science and technology and was lucky enough to work on building early forms of today’s PCs at Research Machines (now RML), as well as developing the world’s second voicemail system from scratch. Lewis says he brings a broad range of knowledge and experience in project management, consulting and systems integration to Centrica. “Additionally, I’ve had the good fortune to be included on the boards of a number of leading edge technology companies which are helping shape the computing and telecommunications services of the future.”

Centrica, the parent company of British Gas, is certainly a business on the up – due in no small part to soaring energy prices across the world. Formed just eleven years ago, the company has interests in both Europe and the US. British Gas is the largest gas and electricity supplier in the UK. Earlier in the year Centrica announced that operating profits had soared by a massive 40 percent. It’s a company that is fuelled heavily by technology, says Lewis. Indeed, Centrica is home to 3000 servers and more than 450 terabytes of data storage, equivalent to 100,000 DVD ROMS. Centrica is also reported to be the fifth largest user of data storage in Europe while two of the fastest and largest supercomputers are the brains and muscle behind the billing engines. The firm is also currently involved in the largest billing system renewal project in Europe.

Add to this, the challenge of catering to the IT needs of the significant proportion of the staff (around a third) out in the field, as well as the 24/7 nature of Centrica’s operations, and you start to get a feel for the weight of responsibility on this CIO’s shoulders. Lewis replaced Peter Brickley, who had been the appointed as the firm’s inaugural CIO back in 2003, a period which coincided with significant IT investment to standardise processes, overhaul eWorking and improve communications. Lewis stresses that it can be hard balancing short and long-term IT projects: “It is a constant juggle trying to plant seeds for the long term and address the immediate daily and weekly requirements.” There is no clear-cut solution, he notes. “There is never an easy answer to getting the balance of short- and long-term right – you need to be able to make the right decisions with the right team of people, and have the right support at the right time.”

Transformation
Generally speaking, a great deal of scepticism exists in the C-suite as to the ROI that technology can deliver. It is still perceived by some to be an unwanted, or even unnecessary expense carried out by techies in a backroom full of humming servers and miles of cabling. Lewis says corporate recognition of a CIO’s efforts depends on where the technology is applied in the business. “In some areas it [technology] is providing the base capability to enable business and is seen as a necessary hygiene function, and therefore often low return on investment,” he states. “In other areas it can be applied for long-term competitive differentiation and the benefit is measured in terms of new revenue streams or market transformation. The approach varies widely across our business units, but we are working across all businesses to see where we can develop long-term sustainable advantage through the application of IT.”

He is also quick to dispel the myth that CIOs are just focussed on solving technology problems and driving innovation. He argues that they need to double as business leaders too. “Far from being hidden away in the office, the leadership role involves just about every form of communication from informal social events and lunches through to more formal newsletters, meetings and events. Just recently I hosted a leadership conference for 150 leaders across the whole of Centrica, mostly outside of IS, around how we will continue to build up the leadership qualities across the population. A leadership role has many dimensions but a key one is being able to have a two-way dialogue with the people in the company.”

Lewis continues: “We are very focused on developing leadership behaviour and living cultural change at Centrica. Secondly, we are also encouraging a much more balanced approach to general management – not led by a finance, marketing or operational approach, but a combination of all the functions to form a balanced view when making decisions.”

Future visions
With his first 100 days firmly behind him, Lewis is looking forward to helping drive innovation in an industry that is changing – fast. For instance, Centrica, like most of the energy companies, is involved in developing renewable energies and reducing its own carbon footprint – something that has a knock-on effect on the CIO’s work. Lewis expands: “We are building the largest offshore wind farm in the world as we speak while we are already the greenest energy supplier in the UK,” he explains. “On top of this, we have a whole range of internal green initiatives ranging from the data centre through to simpler instances associated with powering down desktop devices overnight.  As ‘the energy expert’ we would expect to take a real lead in this field.”

As well as this, Centrica is ploughing investment in fuel cell technology. Just last January the company took a 10 percent share in Ceres Power, the fuel cell group, in a deal worth around €25 million. Ceres is busy developing combined heat and power systems (CHP) units that will provide cheaper, lower carbon energy to the home. Lewis emphasises that technology investment like this will ensure that the business continues to go from strength to strength. “We will keep the lights on for Great Britain plc. and as a inherent part of that we need to seek new and innovative ways of not only delivering gas and power, but also optimising every aspect of the way we use energy. That goes through from new investment in technology such as our investment in Ceres Power, to the way we interact with our customers.”

Centrica at a glance

• Market capitalisation of €16.5 billion
• Supplies 42bcm (billion cubic metres) of the total gas demand on both sides of the Atlantic
• A top 30 FTSE 100 company with 33,000 employees worldwide
• Its retail businesses provide energy for over 20 million customers
• Will spend €3.8 billion over the next three years to secure new UK gas and power supplies