CIOs, Meet Your New Boss - ' CIO as Referee '

The way companies make IT decisions is changing. "The business is driving new projects these days," Campbell says. "It's the head of sales saying, 'We need CRM.' Instead of a business analyst within IT translating that into specifications, the business leader makes a short list of preferences, and makes the case to the CFO, who makes a decision based on ROI, and mandates to the IT department."

The risk in business-driven projects, Player says, is the rise of "little IT," stand-alone projects that are not optimized or integrated into the rest of the company's infrastructure. Coordination across the enterprise is critical to success. "The CIO or CTO needs to be a referee," Moultrup says. At Abercrombie & Fitch, an IT oversight committee that includes representatives from merchandising, stores and other areas is working to define the technology needs for a chainwide revamping of core systems. Abercrombie CFO Mike Kramer came to the company from Apple's retail arm; he brought in another Apple vet, Kristin Bloom, as CIO. "If you just let CIOs run off on their own and create a solution, it can cause a lot of problems with the integration into the rest of the organization," says finance VP Nuzzo, who reports to Kramer. "It creates bureaucratic infighting and budget overruns."

One example of a CIO who has moved successfully into the business is David Furnas, CIO at Gila Regional Medical Center, a county-owned hospital in Silver City, N.M. Furnas used to report to the CEO. But about six months after he took the job, he was moved under the chief medical officer. "We wanted to demonstrate our commitment to health and the role of IT in improving the quality of outcomes and care," Furnas says. The results of the shift have been dramatic. Furnas says he has gotten much closer to the medical staff and now understands the physician workflows intimiately. Physicians call him directly for help, and they discuss IT issues directly related to care. In a hospital, it doesn't get much more strategic than that.

Furnas also is involved in a major effort to make Gila Regional Medical Center paperless by 2012. The project requires working closely with all the physicians practicing at the hospital, many of whom have outside offices as well, to convert their patient records to digital forms. "As long as I am still fully engaged as a member of the strategic team and the board views me as a strategic executive, I have no issue with not reporting to the CEO," Furnas says. "To be honest, it keeps me out of a lot of board meetings I don't need to be in." —with Dan Briody