Chris Coupland says his unusual title is a consequence of BAE Systems early and sustained commitment to e-Business. He joined BAE Systems in 2000 as director of e-Business, and was responsible for Exostar, the electronic marketplace for the defense and aerospace industry. At the time, there was also a group IT director — the company doesn’t use the term “CIO” — but in 2002, he was asked to take on that role, as well.

Although he has a corporate policymaking role as IT director, he doesn’t dictate policy. Rather, he oversees a small group that looks at the company’s global competitive position as well as a much larger group that delivers infrastructural services in the UK and manages the global relationship with CSC.

CSC World: BAE Systems’ strategy is to create sustainable shareholder value by being the premier transatlantic defense and aerospace company. What is IT’s role in achieving that goal?

Coupland: The transatlantic defense and aerospace industry is collaborative and competitive. On every project, we’re working with suppliers and other manufacturers, and IT is there to help us collaborate with third parties. These projects can be very complex, with long development cycles. The lifecycle on a nuclear submarine or a combat aircraft can be longer than 20 or 30 years from production to support.

We make the Nimrod patrol aircraft — which has electronics for surveillance as well as for flying and navigating. The development cycle of these aircraft is such that there is a continual need to upgrade and address obsolescence over the lifetime of the aircraft.  The sophisticated state-of-the-art electronics and IT will need to be upgraded several times over the long life of the asset. These are the challenges of projects which are bespoke, small volume, and have long, long lifecycles.

CSC World: Growing through acquisitions on both sides of the Atlantic must make IT governance quite a challenge. How are you meeting that challenge?

Coupland: Like most corporations, we have swung between a centrist approach and a decentralized one to internal IT governance. We have major operations across five continents and in order to bring together IT and the individual businesses we have a Council arrangement. We don’t dictate standards from the top. My role is to guide and shape the agenda but not to dictate it.

CSC World: How about governance in the outsourcing relationship?

Coupland: Clearly we and CSC have a contract. But what we found in the 2000 contract extension was that what it said about service levels wasn’t enough. So we came up with what we call the Continuous Improvement Framework, which is non-contractual.

The CIF covers eight to 10 different areas across the business — financial performance, service performance, and administrative tasks such as assets management, billing, invoicing, proposals, etc. Mundane things that can nevertheless cause a relationship to sour if not addressed. We set targets each year that both sides buy into. We sit down and say, “That’s where we got to on asset management accuracy, or project management as a discipline, or procurement cost savings last year. Where do we want to get to this year?” And we’ve had a lot of success in jointly meeting those targets.

CSC World: These days, CIOs are being asked to promote the company’s business performance, not just to cut costs. Is that true at BAE Systems?

Coupland:  IT is now central to our business in a way it wasn’t 10 years ago. While the link between IT and business winning is perhaps less obvious than in financial services, much of the business we have been so successful at winning in the support area is critically dependent on data integration from a whole load of systems. And the design and manufacture of complex weapons and war-fighting systems in the first place relies on some pretty sophisticated systems also.

CSC World: There are lots of other big IT outsourcing contracts out there. What advice would you give other CIOs about how best to manage an outsourcing relationship?

Coupland: Make sure you and your service provider are very explicit about what your objectives are and about your commitments to each other. And hold each other accountable to those commitments, whether they’re contractual or just commitments you and I have made about what we’re going to do over the next two months. Getting that culture of working together has been helpful in our case.

CSC World: The BAE Systems-CSC relationship is usually described as a partnership. How do you see that partnership?

Coupland: Some people think partnership means you’ve gone soft, that the contract doesn’t matter. The contract is what you’ve signed up to do, so if you and your service provider aren’t clear about what you’ve signed up to do, then you should be quoting the contract. But if you understand what’s in the contract and are working together, then you don’t have to bring it up every five minutes.

CSC World: How far down do you get involved in the relationship?

Coupland: We have spent quite a bit of time building relationships with the local IT and business leadership in the account. And I’ve spent a lot of time helping CSC communicate better what it is they’re doing, where it’s going well and where it isn’t going so well and what we’re doing about it. We’ve also worked together to introduce some terminology that means more to the business leadership.

CSC World: What’s an example of that?

Coupland: We used to report systemwide availability of service, which is usually 99.99 percent. But we turned that on its head and decided to measure what isn’t available. Lost user hours per person per week, for example. The business MDs understand that, and it’s something you can compare across businesses.

Right now, we’re running about 40 minutes per user per month, which is about a cup of coffee a week. But the businessmen all understand lost user hours. This was a concept we introduced — again, noncontractual — and which CSC embraced and then improved by 40 percent over an 18-month period.

CSC World: A new contract was just signed. What do you see ahead?