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Digital CEOs

No longer “digitally homeless,” savvy execs are putting tools to work for them.

When Matthew Rose graduated from business school in 1981, he owned exactly two items that could be considered high tech: a desktop computer and a calculator. He didn’t really need anything else. Rose was embarking on a career in the railroad industry, which at that time was about as old economy as you could get.

Flash forward to 2004. Rose has an IBM laptop, a Nokia cell phone, a BlackBerry, a Motorola two-way pager and, for overseas travel, an SBC satellite phone. He is now CEO of Burlington Northern Santa Fe, a railroad that traces its lineage to 1849. Over time the company has grown into a transportation goliath, with sales of $9.3 billion, and one that is decidedly high tech.

Burlington Northern makes use of track-side monitors, for example, that can remotely assess the mechanical health of a passing locomotive, or verify that an item of freight is truly onboard a speeding train. The raw data gets translated into a constant stream of postings on the company’s intranet. For his part, Rose keeps perpetual tabs on his railroad via his assortment of gadgets. “I had no idea everything was going to change so fast,” says Rose. “To be an effective CEO these days you have to be comfortable with technology.”

Granted, cell phones, pagers and email can hardly be called bleeding-edge technology. But consider that just a few years back, Nicholas Negroponte, founding chairman of MIT’s Media Laboratory, coined the term “digital homeless,” referring to hidebound, middle-aged executives who were getting rapidly displaced by the technology revolution. Only a short while ago, the stories were legion of CEOs who asked their assistants to print out all their emails or, if you believe that urban legend, those who used their CD-ROM trays as coffee cup holders.

No longer. According to a 2003 study by Forbes.com and Gartner.com, 82 percent of C-level executives check their own email before work; 80 percent make use of search engines such as Google or Yahoo; and only 6 percent delegate the task of checking email to an assistant. Rather than viewing technology in gee-whiz terms, CEOs are coming to look at various gadgets as essential tools for amplifying communication and enhancing efficiency. And those tools are becoming fixtures, both on corner-office desktops and in CEOs’ pockets and hip holsters. No longer lagging way behind the 20- and 30-something CEO crowd, older executives are buzzing, beeping and ringing with the best of them.

As for which info-tech tools are best, there is no consensus among CEOs. Some are cell phone junkies, while others prefer to do everything by email. Such choices are based on the CEO’s individual style and his or her company’s culture. “This is personal media. The fact is, it is not one size fits all,” says Paul Saffo, research director of the Institute for the Future in Menlo Park, Calif. Fortunately, there are enough tools and gadgets out there to suit just about every personal preference.

Peter McCausland is CEO of Airgas, a distributor of industrial gases such as nitrous oxide, based in Radnor, Pa. Since 1982, McCausland has seen the company he founded grow to $1.8 billion in revenues and 8,500 employees spread out across nearly 800 locations throughout the U.S. As his company has become increasingly decentralized, McCausland has found email to be an indispensable tool. It meshes well with Airgas’ no-nonsense, engineering-driven culture, where there’s little room for small talk. “We’re dispersed all over the country,” says McCausland, so “email is so much more efficient than the telephone, which always requires a warming up period. Often you have to exchange niceties before getting down to business.”

And thanks to his BlackBerry, McCausland always has access to email via wireless connection. “Thumb Tribe Executives,” as BlackBerry fanatics have come to be known, can now be seen just about anywhere, typing away furiously on their tiny keyboards. McCausland relies on a system of abbreviations for BlackBerry emails, understood by his colleagues at Airgas. For example, C means “see” and U means “you.” KIT means “keep in touch.”

More and more, CEOs are going beyond mere adoption of tech tools to customizing them for greater efficiency. Take Intel’s Craig Barrett, a decided member of the Thumb Tribe who has keenly programmed his BlackBerry with a series of hierarchical rules to sort email messages by importance. He furnished Intel’s top brass-and his wife-with a secret code word, and his BlackBerry is set to vibrate if it receives a message bearing the code. This way, Barrett is alerted to important emails no matter where he happens to be. Less important emails (sans the magic code) are downloaded but don’t trigger the vibrate function. Barrett has also programmed his BlackBerry so that the bulk of emails remain on his desktop computer. That way he can read them at his leisure. “I’m trying to prioritize and be efficient,” says Barrett. “I only want to use the BlackBerry for important messages so that it doesn’t wind up cluttered.”

Some CEOs, like Paul Toback of $1-billion Bally Total Fitness, are using ubiquitous devices in increasingly creative ways. Toback, a cell phone devotee, recently acquired a new gadget, a Sprint phone with a camera. “So many times you’re on the road and you see something such as a promotional sign or an interesting advertisement,” he says. “This way I can communicate directly with the staff back at corporate. I don’t have to run to Walgreens and get a disposable camera.”

Laptops are another device that inspires passionate feelings among CEOs, both those who use them and those who eschew them. In the wake of 9/11, particularly, trying to carry a laptop onto a plane can result in all kinds of time delays and security hassles. There’s also the fact that even the sveltest laptops weigh in at a few pounds, minimum. That’s a techno albatross for the CEO who wishes only to check email while traveling and has no need for word processing and other computer functions. “I don’t take my laptop on the road anymore because I’m using my BlackBerry,” says Rose of Burlington Northern. Bally’s Toback concurs: “Even a laptop has become an oversized device, so I don’t take one anywhere.”

The Anytime, Anywhere Office
But for every laptop detractor among the CEO set, there’s another who can’t live without one. Doug Freeman, CEO of $4.3 billion-asset NetBank in Alpharetta, Ga., estimates that he spends 85 percent of his time traveling. While on the road, he needs to do more than just check email. Freeman regularly turns to the Internet to check real-time data such as interest rate moves. Frequently, he has to work on financial spreadsheets that would be impossible to view in a little BlackBerry-sized display. “I need to be able to simulate an office while I’m on the road,” says Freeman.

Freeman’s Compaq laptop is also equipped with a Wi-Fi card. Wi-Fi is a hot ticket these days, because it makes it possible for laptop computers to wirelessly connect with the Internet. Enabled laptop users can log onto the Net from anywhere provided they’re within range of a Wi-Fi broadcast station. Starbucks has started furnishing its coffee shops with Wi-Fi transmitters, as have many corporate headquarters and college campuses. For his part, Freeman is forever in search of places where Wi-Fi is available. In airports, he often goes to the Delta Crown Room, a lounge for the airline’s frequent fliers that provides a Wi-Fi signal. A sailing enthusiast, Freeman has even outfitted his boat to make it Wi-Fi ready. “Thanks to technology, I can pretty much make my office wherever I happen to be,” says Freeman.

Of course, the specialized needs of CEOs demand specialized technology solutions. Associated Production Music is a private joint venture held 50-50 by EMI and BMG. The world’s largest supplier of music for television, film and advertisers, it commissions and produces original works used in everything from Training Day to the Oprah Winfrey Show to Budweiser commercials. Associated Production Music’s main offices are in New York and Los Angeles. CEO Adam Taylor works out of L.A., but needs to stay in constant contact with the New York folks. And neither the telephone nor email is sufficient. After all, those communication modes are pretty limited if someone in L.A. is trying to discuss a movie score with someone in New York. Taylor’s solution: install a videoconferencing system.

It’s possible to do a split screen, with the videoconferencing parties occupying one half and a movie or advertisement projected on the other half with the score playing. That way, everyone is on the same page, quite literally. The system cost $20,000 and Taylor estimates that it saves the company $50,000 a year in travel costs. “It’s much richer than a phone call could ever be,” says Taylor. “You can see faces and emotions and reactions.”

Rick Horrow, on the other hand, doesn’t own a BlackBerry or videophone, but his choice of gadget proves that sometimes, simplicity is most efficient. As CEO of Horrow Sports Ventures, a Miami-based affiliate of Omnicom, it’s Horrow’s job to cobble together complex stadium financing deals and, since founding the business two decades ago, he’s been involved in 100 deals worth more than $13 billion. His tool of choice is a Sanyo cell phone preprogrammed with the phone numbers of such luminaries as the golfer Greg Norman, NFL Commissioner Paul Tagliabue and Bill France Jr., CEO of Nascar. “I live in a world of political nuance and persuasion,” says Horrow, who makes an estimated 100 cell phone calls a day. “To me, the inflections, attitudes, language, tone-even the pauses and silences-are much more important than reading the same thing on a BlackBerry.”

Horrow doesn’t care much for email, period. He has an address, but the messages are automatically forwarded to his assistant, who reads them to him over the phone. Then Horrow generally calls the sender back, establishing verbal contact, the medium where he feels he has an edge. Even Horrow’s choice of car was driven by cell phone fanaticism. His brand new maroon BMW 745 sedan is well insulated from engine noise and angry commuters laying on their horns. This allows him to conduct business while driving. “The sound quality is impeccable,” says Horrow. “I can have normal conversations while I’m driving and the person on the other end can’t tell that I’m not in my office.”

So what types of things are coming next down the info-tech pipeline? Rough versions of pen-based computing are already available, making it possible to store handwritten documents on a computer. Speech synthesizing technology is advancing quickly. Gearheads are busy working out the bugs in software that converts text into speech and soon it will be possible, say, to have your computer read you your emails. What about getting the scoop on the latest in eye-popping devices? Many CEOs are too busy to stay current on personal technology advances. With so many business journals to read, few want to spend time scouring PC World and the like. Which is why the Institute for the Future’s Paul Saffo suggests CEOs designate a reverse mentor. This can be a resident techie whose job it becomes to keep the CEO updated on the latest and best gizmos. Says Saffo: “No CEO should ever again have to stew in technological ignorance.”

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