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CIO, a Role for Two

Actors often enjoy the challenge of a role that requires two completely different personas to be presented.  Jekyll and Hyde, Peter Pan’s Captain Hook and Mr. Darling as well as The Prince and the Pauper all give an actor the chance to play two different people within the same role.  In the case of CIOs, they are cast in a role that has a similar theme, requiring two very different mindsets.

For the CIO, this duality is described in a variety of ways.  Sometimes the CIO’s job requirements are discussed as internally and externally focused.  In other cases people separate the responsibilities into infrastructure and business.

Regardless of how the aspects are expressed, there is an understanding that the CIO provides leadership in two different realms. One realm is focused on keeping equipment operating, minimizing maintenance costs, achieving SLAs and allowing the business to derive value from IT investments.  The other realm focuses on business strategy and seeks to derive new functionality in support of improved productivity, customer service, profitability and other corporate measures.

By analogy, the first realm keeps the power flowing while the second creates new devices to plug in and do work.

One could argue that a rethinking of corporate structure might help simplify this situation.  After all, we don’t charge the CFO with maintaining the infrastructure around financial systems, including file cabinets, door locks and computer hardware.  Why should a person charged with exploiting computers for the benefit of the corporation also be charged with the maintenance of the computer hardware and software? Couldn’t the latter responsibility be provided by an operations group, similar to the handling of most utilities?

Articles and books abound containing a variety of recommendations for becoming an effective CIO.  Martha Heller writes in CIO magazine that, “For years, we have been preaching that CIOs should know the business … But they still need to remember the ‘T’ in IT.”1 She goes on to quote Barry Libenson, CIO of Land O’Lakes.  Barry states that CIOs hired out of the business and not adept with current technology are, “doing their companies a disservice.”1

Contrast that view with those summarized succinctly by Wikipedia’s description of the CIO’s role, “More recently CIOs’ leadership capabilities, business acumen and strategic perspectives have taken precedence over technical skills. It is now quite common for CIOs to be appointed from the business side of the organization.”2 Given the diverse set of opinions, the CIO clearly has two very different set of responsibilities, those with a technical focus and those with a business strategy focus.

Fundamentally, neither the technical nor business aspect of the role is more important. Therefore, when filling the CIO role there are two options.  The CIO must have extensive technical and operational expertise or there must be an organizational structure and effective team that allows for proper focus to be given to each realm.  The CIO in the latter situation must be able to effectively manage these teams while avoiding the natural inclination to provide a disproportionally large amount of focus on the area with which the leader is most comfortable.

I’ve had the privilege of working in many organizations, interacting with CIOs and other business and IT leaders.  These experiences have allowed me to observe some of the ways in which the IT function may struggle to deliver value when the organization or the CIO isn’t setup to succeed across both realms.

Over the years I’ve been in environments led by CIOs that have strong business backgrounds and those with focused technology backgrounds.  It is less common to encounter leaders well versed in both.  When I do, they often have a very effective IT leadership team and governance process in place since they realize the orthogonal relationship encompassed within the role.

In the absence of such breadth what can happen?

With technology-centric CIOs I’ve observed two issues.  The first is a desire to teach the business about the value of IT (and even how things work).  The second is a belief that the maturity of the technology and practices he or she used when employed as a developer or architect have not changed significantly.

Considering the desire to educate his or her peers, it is as if the CIO wants to grow the level of IT knowledge throughout the executive team.  This is inappropriate.  The CIO should be assuring value is achieved through the use of IT assets.  Members of the executive team each have expertise.  It is the expectation that each one leverages that expertise to deliver business value.  Any education should be in business terms and focused on a shared vision of pursuing corporate strategy.

If the CIO pictures technology maturity based on previous experience there is the risk of missing opportunities.  I once worked in an organization led by a CIO who came out of the developer ranks and had gained a mistrust of packaged solutions.  His fond memories of coding programs back in the 1980s were preventing this company from leveraging a variety of powerful enterprise solutions.  This in no way helps the business maximize the value derived from IT investments.

Inefficiencies may also exist when the CIO has a business-centric background.  Without technical understanding I’ve seen confusion and inaccurate communication regarding operational details. In these cases the IT organization finds itself without executive-level representation regarding the limitations and risks of the current IT environment or the challenges related to new projects.

I was once at a company where the CIO suggested using the email system as the CRM solution.  From his point of view the email program presented a list of customers (names and email addresses) so it must be possible to add the additional information and functionality necessary to manage relationships with them.  Such thinking does not instill confidence throughout the IT organization and inappropriately oversimplifies the IT function for the other business executives.

My belief is that businesses must either separate these two realms and put appropriate leaders in place for each or assure that the CIO is properly supported, with an effective background and organization.  I am not convinced that either option is better.

Splitting the role between two people seems to invite a loss of connection between the need to align the infrastructure with the business strategy.  Keeping the roles combined requires a heavy lift for the CIO to be effective across all constituents.

There are those that feel the role itself should be morphed into a new paradigm.  For example in his book, “fruITion”, Chris Potts argues for placing the management of the IT infrastructure under an operations group (purely a service group to keep the systems running and optimizing costs).  The value-add aspect of IT would be owned within the business departments.  Executive governance would be overseen by a Chief Internal Investment Officer (CIIO), who would assure effective use of the IT assets.

I doubt there is a one-size-fits-all approach.  The reasons for variety include company size, maturity, relationship of IT to the business functions, experience of the executive team and many others.  As a company matures in any of these dimensions the optimum IT organization may need to be redesigned as well.

However, regardless of the organizational structure, the existence of formal governance, sized properly for the company, charged with managing shared services and prioritizing projects in a way that advances the company’s goals, will be key to maximizing the value obtained from IT investments. Such structure is required no matter how well versed the CIO is with technology and business strategy.

What organization structure do you use to maximize the benefit derived from IT assets across the business?  Do you leverage formal governance processes?  Do you apply concepts from frameworks such as COBIT or COSO?  I’d like to understand how other organizations confront this challenge.


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