Revenge of the nerds

Mohammad Al-Khatib, CIO of Amman Stock Exchange (ASE), is positively ebullient about being named CIO of the year: "It's recognition of your achievements - especially when it's ACN, which was the first IT magazine in the Middle East and has a very good distribution. It gives a very important recognition - it feels great."

However, Al-Khatib believes the region will soon face a shortage of human resources particularly at the managerial level: "The problem is finding IT managers - not just at the CIO level - but people with special skills who are technical enough to understand the fine details of technology. At the same time, you need people with leadership skills to run the operation. This kind of combination is very hard to find."

His other main concern is that many regional companies have still not attained the scale of their Western and Eastern counterparts, with many firms that are considered enterprises here equating to a medium scale organisation in other parts of the world. The cure to this problem, he believes is the recent regional shift towards consolidation.

"New laws and regulations encouraging investment and the excess liquidity that is present in the region in the past few years have had a great effect on us. Companies with resources are trying to expand and creating huge companies which can reach the level of enterprise users. For example, mergers and acquisitions in banks and the telecom sector create bigger companies and slowly you can achieve the scale of companies in industrialised countries. It's not just normal growth but companies starting to operate on a regional scale," says Al-Khatib.

As a CIO, Al-Khatib often has to consider the issue of how to integrate business practices with the work of the IT division. Again, he considers people to be the lynchpin of a successful strategy.

"To be honest, I think what creates an IT industry is that you need more nerds! You need people who have a strong affection and desire to get themselves involved in the technology. These people make exceptionally good technicians, programmers, network and system administrators and in my opinion, are rare in our societies, which doesn't encourage them, "he says.

The drawback with employing ‘nerds', however, as Al-Khatib puts it, is that their technical strengths which are a gift in the world of IT can also rob them of them of crucial management abilities.

"Unfortunately, nerds don't make the best managers. They need to be charismatic and have leadership skills - but nerds tend to be more isolated and individual. They must also understand how to write reports, talk to senior management, know how to handle the vendors - this mix of qualities is extremely hard to find," explains Al-Khatib.

The ASE is one of the oldest bourses in the region, having been established in 1976. It achieved full automation and decentralisation in 2000 with a particular highlight being the move to remote trading in 2001, and the subsequent elimination of the trading floor. Al-Khatib attributes this success to the advanced state of Jordan's telecom infrastructure - although there were teething problems in the early stages.

The main issue was dealing with the website load which reaches 1.5 million hits at peak hours. Initially, the website was hosted in the United States, but this proved problematic due to time differences, as downtime typically occurred on the American weekend. Al-Khatib solved this by hosting the website inside Jordan.

"We have installed an E3 connection over fibre optics with Jordan Telecom and hosted the website on our own service running on IBM AIX machines and 12 processors at the moment. It's a huge setup just to handle the large number of hits. To manage the load balancing, we settled on Juniper's DX which not only load balances across the servers but additionally uses data compression between itself and the end user, saving us approximately 35% of our internet connection. We had to look into solutions and gain expertise in things that nobody else uses," says Al-Khatib.

The successful move of the website hosting from the United States to Jordan is only part of Al-Khatib's challenges. His biggest fear, and indeed the natural enemy of any stock exchange, is downtime.

"This is really our biggest challenge. The problem of a stock exchange is that it has to be operational every day. Every day you have milestones that happen at specific times, like the opening and closing of a session. If they don't happen, it's a disaster because of the importance of the stock market to the country, the economy, and the investors. Such mistakes are taken very seriously - as CIO, you see your mistakes in the newspaper and on the evening news," he says.

Al-Khatib has a full disaster recovery plan in place at the ASE, in addition to redundancy at the production site. He and his staff also conduct frequent dress rehearsals and scenarios. Despite these measures however, he is all too aware of the inevitability of hardware and software failure and the resulting downtime which follow them. As he explains, these occurrences are the real test of a CIO's mettle.

"We have a definition of what is to be considered a major problem. If it affects the whole market, an emergency committee is formed automatically. The members know that they belong to this committee, and immediately report to its chairman. This committee starts to follow the procedure of sorting the problem. For example, if it's an IT problem, the IT department will start to analyse what went wrong and if there is a stoppage in the trading system or a failure of the network, then you need to try to understand if you can recover and how long you need to recover. This committee liaises with all other parties, including senior management and the market," he explains.

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While the natural reaction of many companies in the region is to lock down and prevent bad news from escaping, Al-Khatib goes against the grain with his belief in full disclosure: "We have a saying in our society: ‘The sun cannot be covered with a cloth.' When you have an obvious problem, you cannot pretend that you don't have it. The brokers in the market need to understand what's going on - you need to disclose this information, as bad as it is. You need to inform people that the service is being stopped, that this problem is being studied and that they will be kept informed.

"Once we do that, it gets people off our back - this is the advantage of disclosure. When we can control the problem, decide what to do about it and work out how soon we can go back to normal operations, we then disclose that as well," he adds.

The constant threat of system failure can make for a high pressure work environment for Al-Khatib's staff. His proudest achievement as CIO, he says, is that he has not lost a single employee in ten years of service.

"There are three main reasons for this, in my opinion: atmosphere, financial and career development. First, the environment in my department is extremely friendly. I've handpicked all my employees - and they‘re all nerds! This is very important because these people really care about the quality of their work and take pride in what they do. When it comes to financial compensation, I can't say we are the best but we compare fairly well with similar positions within the country.

"But most importantly, we offer career development. No IT professional wants to risk being left behind and discovering that 21 year old graduates know more than they do. However, as a stock exchange we always have the latest technology because of our IT investments. For an IT person, this is important because as long as you are working in such a setting, it means that you are developing yourself."

Al-Khatib believes many regional enterprises are crippled by the lack of available documentation for both daily and emergency procedures.

"I have an operations manual in my department, which people can refer to. Documentation, procedures, implementation, manuals are very important.

When problems happen, if you have proper documentation you can recover faster, better and manage your crisis much better. This is something that I noticed many businesses in the region are stil not taking quite as seriously as it should be taken," he explains.

In the coming months, Al-Khatib will oversee a major upgrade to the Exchange's trading systems. He also plans to implement internet trading with plans to go live before the end of the year. The latter will hosted directly by the stock exchange.

"We are providing the internet connection, the security and the servers. All brokers have to do is install their software on our servers. This is unique in the region - we're the only stock exchange that's actually offering its infrastructure in this way," states Al-Khatib.

Al-Khatib also underscores the importance of delegation: "There is nothing in the daily procedure of work that depends on me - everything is delegated. It's very important for a CIO to know how to motivate people and give them the responsibility and authority to work.

In closing, Al-Khatib advises regional CIOs to balance the needs of being both a leader and being a technologically focused person, in addition to being able to handle the needs of management: "To become a leader you need to be able to gain the trust of your employees. You have to think about how to retain all your workers and protect their rights."

"When it comes to technology, I think that experience is very important and that it comes with time. It's a continuous improvement process - the industry that we are working in is a changing environment. Ten years ago, people would not have even imagined the technologies that we are using today. So you need to keep yourself on the edge," he concludes.