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Ram Charan: The Business of Security

Lynn Mattice, CSO of Boston Scientific, quizzes the man Fortune magazine calls "the most influential business consultant alive" about how security executives can better serve the business

Charan: Security people have to really master how the business makes money. Move the security people in their early careers across the functions, then bring them back. If you rotate them into other functions and they succeed, you make a broader person, and that person has a real opportunity to move up the ladder.

CSO: If they succeed in another function, doesn't the security department run the risk of losing that person?

Charan: That's a good idea. Lose them. You would create better people. It's a very narrow thinking of one department "losing" a person. How many CFOs have become CEOs? Let's really kill that narrow thinking.

Mattice: Eliminate the stovepipes.

Charan: The stovepipes, that's what hurts. That's why people don't move out of IT and HR—because they don't rotate their people and think of the company as a whole. Your CEO, Jim Tobin—look at his background. He's a CEO today. What was his background? He came from Baxter [International].

Mattice: He started off in finance over there.

Charan: You got it. He wouldn't get the job unless he was broader. He wouldn't be making the moves he has made so successfully. The idea here is that to be able to bring your chair to the table, you've got to learn the business. You've got to be interested in the business, as you, Lynn, have been interested, and you've got to have the rotation early in your career. Companies that do not do this do not do as well. It's very common at successful companies like General Electric, like Target, like Wal-Mart—these people all do the rotation. The CEO of Wal-Mart used to be a logistics person. He drove trucks.

Mattice: Understanding all of the elements of the business so that you can address their concerns and issues as they evolve.

Charan: Yes, but it's more than that. They've got to work in more than one function, not only understanding but absorbing it. Living with it.

Mattice: I worked for one company where one of the requirements was that at least once a year, everybody from the corporate offices had to go out and spend at least a day on the factory lines so that we didn't forget how we made the money.

Charan: I think that's helpful. I'm thinking something deeper. That is, you're going to go work for a couple years in other functions.

CSO: It's interesting to me that Lynn mentions IT as an example of a function that has moved up the ranks to join the executive suite, but Ram, from your perspective, it sounds like you don't see that people are moving out of IT into other functions, either. Are we understanding correctly?