There is a sense that we can perhaps unbatten the hatches on the basis that the economic storm is passing. There may even be a sense that we can move the focus from cost to investment.
This may in turn cause a chief information officer to knock on the boss’s door to review where they sit in the grand hierarchy: many have suffered acute collateral damage to their careers from the untargeted “cost management” initiatives following the outbreak of recession.
The question is: how should the chief executive respond to this career upgrade request. My heart says that they should bring the CIO into the boardroom at the first opportunity and build the organisation around its IT investment. This is, however, both correct and naïve.
Before making a decision, there are three factors to consider: the organisation, the CIO and the IT infrastructure.
● The organisation: To what extent is the boardroom (and thus the organisation) an embracer of new technologies?
Most boardrooms are technophobic or techno-indifferent. The latter is the most worrying characteristic as it suggests it simply does not see IT and its derivatives as being strategically significant.
If a CEO believes the organisation can thrive in a global playground without strategically levering new technologies then they are likely to be strategy indifferent as well.
So, if an organisation doesn’t make the link between its sustainability and new technologies, any action the CEO takes in respect of their CIO will largely be pointless. They can stop reading at this point to consider a life beyond commerce.
● The CIO: If an organisation does get IT, the next question to ask is whether the CIO gets business. If, when asked a few questions in relation to the business key performance indicators, the CIO’s eyes glaze over (in much the same way as the CEO’s do when the CIO talks in technology) then a new CIO is needed.
● The IT infrastructure: If both your organisation and the CIO are pointing in the right direction, the next question is whether the IT infrastructure delivers the service the company needs today and has the flexibility and scalability to provide the service it might need tomorrow.
If the IT infrastructure is not where it needs to be then CIOs should continue to report to the CFO. Fundamentally, if the IT department is not providing an appropriate service then this is a procurement issue (whether internally or externally sourced).
Forget all suggestions of the CIO being the co-creator of business strategy until this is addressed. What such an organisation really needs is a good IT manager. Think “run the business”.
But for organisations with an impressive and good value IT platform, I suggest the CIO reports to the chief operating officer, so that they can play an active role in improving the performance of the business – for example, by driving more cost out of the supply chain and improving the customer experience.
The CIO’s focus needs to move away from technology and more towards the management of technology derivatives such as information and knowledge. Think “grow the business”.
The next step is to harness a CIO’s capability in building tomorrow’s business. This will be determined by identifying and capitalising on market trends.
Thus it makes sense for the CIO to report to the chief marketing officer. Some businesses may have tried this during the heady dotcom days. Think “change the business”.
But if the survival of an organisation necessitates disrupting the market then I suggest the CIO reports to the chief executive. As competition heats up and customers become more discerning then this may become surprisingly common. Think “save the business”.
An important point to make is that all of these scenarios have a cost management element and an innovation element. And all of these scenarios are not coupled to the economic conditions.
Thus the idea of savaging the IT budget during the recession and loosening the budget strings during the upturn is way off the mark. Many will perhaps think that “save the business” is a recession play. Again I think it will be a common cry going forward from the boardrooms of organisations that were not constructed on web foundations.
The CIO role is thus an important one. However their place in the boardroom is not one of entitlement but more of appropriateness, depending on where the organisation is, assuming both the CIO and the IT infrastructure are doing their job.
I still harbour a belief that the CIO and the CEO will increasingly be one and the same person. With this in mind, forward thinking organisations may consider giving the CIO additional CEO-like responsibilities – for example, making them the CEO of a business unit.
Of course the competencies needed for such CIOs are a million miles from the Chief “IT manager” Officers that many organisations need, and have, today.
I think there are other opportunities for the CIO, including chief energy officer, chief facilities officer, chief business process officer, and chief knowledge officer.
Again it would be inappropriate to bestow any of these titles on the CIO until they get their IT house in order. CIOs have a choice: fix their IT function and make a play for one of these new roles – or do nothing and eventually report into one of these new roles.
The bottom line is that CIOs have very limited career options if they are delivering a substandard IT service. However, the reverse is also true. Business, society and the IT industry need the CIO to raise their game. Step one is for everyone to be clear on what CIOs are for.
Read Ade McCormack’s blog at www.itbeaconblog.com
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