There has never been a stronger need for a solid relationship between the CEO and CIO. Rapid technology advances are causing changes in societal behavior which in turn are having a profound effect on business. Social and mobile technologies have given new power to the customer to compare products, solicit/discover third-party product recommendations, publicly voice their support or displeasure, and buy from anywhere. This has ushered in the ‘Age of the Customer’ which Forrester defines as a “20-year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers” (Technology Management in the Age of the Customer).
Technology is also enabling disruption of entire industries. Think about the effect, for example, that Amazon has had on retail brick & mortar booksellers. In fact, an IBM study found that 41% of CEOs expect increased competition from companies outside their industry in the near future (The Customer Activated Enterprise). They also recognize that companies within their industry are using big data/analytics to improve their decision-making and more precisely target customers. CEOs are placing a priority on shaking up the status quo in their organization. There is a sense of urgency and a push for innovation, and technology is obviously a major part of the solution.
But in too many companies, there is a disconnect between the CEO and the CIO. Jim Stikeleather writes in a Harvard Business Review blog about a research study on the changing role of the CIO and IT (The IT Conversation We Should Be Having). In short, the study found that CEOs believe that CIOs are not in sync with the new issues CEOs are facing. In addition, CEOs feel that CIOs do not understand where the business needs to go and do not have a strategy truly supportive of the business. More specifically, almost half of CEOs feel IT should be a commodity service purchased as needed and do not feel that their CIO understands the business nor how to apply IT in new ways to the business. Moreover, a KPMG survey found that only 5% of executives feel that their business and IT strategies are 100% aligned (Executives See Disconnect Between Strategy and Technology Within Their Organizations). Given this, is there any wonder at the call for the elimination of the Chief Information Officer position and/or the addition of other C-level positions like the Chief Innovation Officer, Chief Data Officer, or Chief Digital Officer? (Will CDO Steal CIO’s Leadership Role?) Yet I can’t help but feel that the major issue here is that too many CIOs have not truly gotten involved in the business and have not worked to develop a solid relationship with the CEO and other C-suite executives.
Tom Willis writes that CEO interest in disruptive enterprise IT is at an all-time high. He has found that CEOs want “strong CIO leaders who can articulate a compelling vision for how they will fundamentally change IT’s role, let go of today to embrace tomorrow, and rally the organization behind them. With the mounting tidal wave of change in technology on the horizon, great leaders will either emerge to lead the company through this change, or the organization is very likely to go the way of Kodak, a tragic victim of the inevitable breaking wave” (Why the CIO’s Time to Lead is Now).
Here are some practical suggestions to help the CIO begin to move in this direction:
- Make the time. A recent Logicalis study found that CIOs felt that they should spend 70% of their time on strategic initiatives but instead day-to-day activities consume 70% of their time. When asked how they planned to free up the time to allot to strategies, CIOs responded that they first planned to streamline and optimize existing infrastructure (Embracing a new IT Reality?). Might I offer a different suggestion? Empower your managers and ensure that they empower their staff. This will necessitate that you communicate direction and expectations. Ensure the necessary guardrails are in place (for example, “do not exceed $50,000 for this effort”). Establish meaningful metrics and service level agreements. Then give them the responsibility and authority, get out of the way, hold them accountable for results, and provide the coaching they need. Drastically reduce your attendance at meetings that do not have a strategic focus. For many CIOs, this approach would free much more time for strategic activities.
- Change the game. Successful organizations of the future must be quick and agile. IT departments must be able to operate at the speed of business and provide the flexibility necessary. Remember that the time for action is now. Don’t drag it out. You have to figure out how to accomplish (and afford) such a radical change while ensuring that current business is not adversely affected. This will likely require IT to become more integrator than builder, more consultative and influencing than controlling. Take a hard look at the skillset of your staff. What needs to be done to prepare them for this brave new world? What can you do to restructure your current IT budget to allow more money to make the necessary changes? Cast a discerning eye on all the services currently offered by IT. Are there any that do not provide your company a competitive advantage? Could those possibly be furnished cheaper/better from an outside provider? How will you manage those outsourced services to ensure their effectiveness and long-term viability for the company? What else can be done inside and outside IT to reduce the costs of keeping the lights on thus providing more investment toward the company’s future? Be sure to garner support by collaborating with your executive peers on this. Then put together a plan for your CEO to approve.
- Get strategic. Research the future of your industry. Gain the insight of various ‘authorities’. Consider discussing this with your vendors as well. Where does your competition appear to be headed? What are your company’s strengths/weaknesses as compared to each of your competitors? Where could you possibly gain additional competitive advantage? How could technology play a role in generating additional revenue? What potential disruptors could be on the horizon? Spend time discussing this with your CEO. How does it fit with his vision for the industry and for your company? Ensure you understand his agenda. Then work with the executive team to envision how technology will impact the future of your company. Ensure you are focusing on the company’s end customer by looking from outside in. Consider defining customer profiles and developing journey maps to describe each potential customer interaction. Use this information to develop and articulate a technology strategy completely aligned with the business strategy.
- Excel at leading change. Change is hard. Habits are difficult to break. Inertia tends to keep one going in the same direction. Many organizations struggle with change. As a result, great strategies can go unachieved; new systems can fail; companies can even go out of business. Become a student of leadership, influence and change. Regularly evaluate what you can do to improve in this regard and let others see you making necessary changes. Make this a routine point of discussion with the executive team and your staff.
So…what do you think? What else does a CEO need from his CIO?