Should CIOs Report to CEOs or CFOs? - ' The Path to Success '

When should a CIO report to the COO?

Reporting to the COO is typically seen when a company is interested in having IT play a supporting role, ensuring that operations are conducted efficiently. But we've only seen a few examples, far fewer than reporting to the CEO or CFO.

Do these different reporting structures create different kinds of CIOs?

There are two very different types of CIOs: the ones very connected to technology and R&D, and the kind you want in a firm pursuing a differentiation strategy, where the CIO has more of a financial background.

What it underscores is the need to recognize that, when you talk about the CIO, it doesn't always mean the same thing. It depends on the type of business. That means you have to weigh the needs of the company.

We see this to be a lot more confusing and complex, or even challenging, but we try to extend both these types of characteristics in the same persons in the same organizations. That's not quite the case: There are two different tracks.

Do you find that one kind of CIO tends to last longer or fare better than the other?

That was a bit of a surprise. People tend to be of the general belief that CIOs are better off in a company with [an overall] differentiation strategy, because they get to be more creative, apply their specialized technology experience, and have a greater role in strategic planning.

We find that it's not the case. It's true for companies with a product differentiation strategy, but not true for companies getting a competitive advantage through their cost structure.