After just two years as CIO of Telefónica in Spain, Fernanda Torquati was approached by the management board of the telecommunications giant and offered the role of global CIO. It was a tough decision, she admits, but the opportunity proved compelling, especially as it involved spearheading the company’s vision of a truly uniform global IT organization.

As with any multinational company with a large legacy of local IT operations built up over decades of growth, this was not a challenge for the faint-hearted: three years on from accepting the top IT job, the transformation is still at the top of her priority list.

Headquartered in Madrid, Telefónica is one of the largest telcos in the world. More than 60% of its €61 billion business now lies outside of its home market and it serves some 281 million customers across its fixed-line and mobile portfolios in 25 countries — mainly in Spanish and Portuguese-speaking Europe and South America.

Behind that is a 5,000-strong global IT organization with an annual budget that, prior to Telefónica’s recent acquisition of Brazilian mobile operator Vivo, stood at around €1.3 billion.

Torquati — who is now also head of Telefónica Global Technology (TGT), a new, wholly-owned subsidiary created to unify the company’s technology operations — says the IT transformation is a key part of Telefónica’s move towards being a fully-integrated global company. But she warns: “This really is a long journey, at least in business terms, when we’re used to ending projects in less than three to four years.”

But, she adds, the benefits of success are potentially enormous. “IT should become an enabler to the business, instead of the burden it seems to have been perceived as historically.”

Global IT transformation

There are two distinct phases to the global IT transformation project. The first focuses on infrastructure, workplace and ERP. “People often don’t pay a lot of attention to the cost of these services, but they represent almost 50% of the total group IT budget,” says Torquati. “Also, there are huge opportunities for efficiency by consolidating and homogenizing infrastructure.”

In the second phase of the project, she explains, the focus will move to business processes and more critical business applications. “But this will happen only once we are capable of demonstrating that we’re evolving to the global IT model in order to add business value but not business risks,” she says.

The project is huge, not least in terms of infrastructure and architecture. In the case of data centers, for example, the plan is to consolidate more than 100 facilities around the world to just five large data centers — two in Europe and three in Latin America.

“We’ve already defined our target architecture and, although it will take a huge effort from everyone involved, we’ll do our best to ensure the entire Telefónica group works towards that same target,” explains Torquati.

A similar approach will be extended to Telefónica’s IT suppliers. The company intends to work with fewer partners but have a much more strategic relationship with those that remain. And a further challenge, which will be more than familiar to any global CIO, is tackling the complex cross-border issues that arise around budgets, taxation and regulation.

Latin lessons

To succeed with such an ambitious global IT transformation program, says Torquati, you must have the buy-in of the entire organization — so that it is seen as a company project and not just an IT one. This means involving key business leaders, ensuring strong project management, and generating excitement around a bold vision with clear targets.

The challenge, however, does not daunt Torquati, who is something of a Telefónica veteran with plenty of international experience and a strong track record in business as well as IT.

She began her career in her home country, Argentina, in the 1990s. Armed with a degree in accountancy and an MBA, she joined management consultancy McKinsey & Co as a business analyst working on projects in the financial and retail sectors across Latin America.

It was an exciting time to be working in business in Argentina as many state-owned companies were being privatized and merger and acquisition activity was rife.

Against this background, the “problem-solving” approach of McKinsey provided an excellent base for the rest of her career, says Torquati. “McKinsey gives you the methodology needed to solve any situation: how to analyze the problem, bring up potential solutions and construct a recommendation. And all this takes place in a high-performance, high-output professional environment.”

From business to IT

One of Torquati’s clients during her six years at the consultancy was with Banco Hipotecario Nacional. In 1998, the Argentinian bank offered her the role of business operations manager. She stayed there for two years before being appointed as business operations director for Telefónica in Argentina in 2000.

There, her interest in the business application of IT took hold. “Nowadays, you can say that every position in any industry is somehow exposed to the IT world,” she points out. But in that first role at Telefónica she actually became the local sponsor for a large-scale, core IT application project.

“It was the first time that Telefónica’s Latin American fixed telecommunication companies had built a regional application,” she says. “It gave me the opportunity to learn a lot from a very complex project. It took a lot of time and effort, but I can proudly say that this application is still running in Brazil, Argentina, Peru, Colombia and Chile.”

After five years in her business operations role Torquati made the switch to IT, becoming CIO of Telefónica in Argentina in 2005. And the following year, she was asked to take on the CIO’s position at the parent company in Spain.

It was a huge decision to make the 10,000km move from Buenos Aires to Madrid, but one she doesn’t regret. “I knew an overseas role would open new paths and opportunities for me, as well as giving me the chance to enrich my personal and professional development. And, after five years of experience in Spain, I can say with complete confidence that it was more than worth it.”

Once in Spain, she undertook a huge local IT transformation project based around the opportunities she’d seen for improvements in IT performance and the need for the IT organization to be ready to support Telefónica’s fixed-mobile convergence.

The strategic role of IT

Although she relishes her current role, she says her career path (as is the case for many top CIOs) wasn’t part of any grand plan — more a combination of taking advantage of opportunities along the way and a lot of hard work. However, she sees IT as currently being one of the most exciting functions for anyone who wants to play a key role in their organization’s strategic direction.

“I’ve always been attracted by IT and its strategic way of seeing global business,” she says. “But, I have to admit that the IT world found me, rather than vice versa. I think that happened because I’ve always been inspired by new challenges — almost every opportunity I’ve taken in my professional career came with high levels of uncertainty.

“On top of that, I believe the telecommunications and IT industries are the most dynamic industries in the world, and the ones that offer the biggest challenges and opportunities.”

Torquati’s consultancy and operations background, plus experience in a broad range of roles in billing, collections and sales back office, means she brings a lot more to the table than someone with a pure IT background. This is absolutely vital for creating a closer alignment between business goals and IT, she believes.

“My experience as a consultant at McKinsey, plus those roles in business operations at Banco Hipotecario Nacional and Telefónica Argentina, gave me a deep knowledge of business processes,” she says. “I learned to speak the language of business, to understand the needs of other functions, and had the opportunity to work with them to review their needs to make the most efficient use of IT budgets.”

Although Telefónica’s global IT transformation project is an enormous undertaking, Torquati is quick to point out that every IT organization must still deliver on its basic responsibilities — with 24/7 uptime as the most essential element. “Availability is the main condition that should be fulfilled if we expect the rest of the organization to function effectively,” she says. “If there is any problem that interrupts the service IT is providing, then no new IT initiative is worthy of anyone’s time or consideration.”

That said, Torquati firmly believes in the two-sided nature of the business-IT relationship. The business needs to recognize the value of what IT delivers to the organization. And support for this kind of 21st-century vision is something Torquati says is changing for the better in many organizations.

“Business management views are gradually changing,” she says with a wry smile. “Historically, it wasn’t easy to get IT issues on the strategic agenda, but these days IT organizations are definitely seen as more critical in the pursuit of strategic goals.”

FERNANDA TORQUATI: THE RÉSUMÉ

2010-present
Global CIO & Head of Telefónica Global Technology
Telefónica Group

2008-2010
Global CIO
Telefónica Group

2007-2008
CIO
Telefónica de España (Telefónica Móviles & Telefónica de España)

2006-2010
CIO
Telefónica Spain

2005-2006
CIO
Telefónica Argentina

2000-2005
Business operations director
Telefónica Argentina

1998-2000
Business operations manager
Banco Hipotecario Nacional (Argentina)

1992-1998
Senior engagement manager
McKinsey & Co (Argentina)