Midmarket CIOs: Fundamentally Essential

By Allan Alter  |  Posted 04-04-2008

Midmarket CIOs: Fundamentally Essential

Midmarket companies are just as dependent on information technology as organizations several times their size. That makes today's midtier CIO a crucial member of the executive team.

More than big corporations with large IT staffs, these companies require the CIO to play a hands-on role in designing and running the IT infrastructure. That requires midmarket CIOs to possess critical IT skills, while placing less of a premium on business skills. Most CIOs at big and small companies alike tend to be career IT professionals with a strong project management background.

However, most midmarket CIOs don't have MBAs, and are more likely to have experience as IT architects. This operations- and technology-focused role in smaller companies leaves plenty of room for influence, even if these CIOs are less focused on strategy: Most midmarket CIOs report to the CEO and participate in business decisions as much or more frequently than CIOs at big companies.

What's missing for small-business CIOs? The bigger salaries of their Fortune 1000 counterparts.

CIOs and MBAs

Few Midmarket CIOs Have MBAs
Like their counterparts at large companies, most midtier CIOs are men in their late 40s with strong IT backgrounds and project management experience. But small and midsize businesses tend to hire CIOs who also have IT architecture experience; systems development is not as high a priority. Business skills appear less important: Only a quarter of midtier CIOs have MBAs, and just a third have been business analysts.

CIOs and Pay

Large CIO Pay Gap Lingers
"Unequal Pay for Equal Experience" was the headline of our 2007 midmarket CIO role report, and that statement holds true this year. Midtier CIOs earn more than they did last year, but their salaries are still just two-thirds of CIO salaries at larger organizations.

CIOs and Technology

Midmarket CIOs Remain Focused on Technology
At large companies, strategy is the CIO's No. 1 job, but at small and medium businesses, strategy plays second fiddle to keeping IT running. With fewer management resources, SMBs are more reliant on their CIOs to provide technological direction and oversight. CIOs at smaller companies are most likely to say their prominent role is being the "person who makes sure the technology works," while those at larger organizations say it's being the "enabler/executer of business strategy."

CIOs and Product Decisions

One-Third of SMB CIOs Make Key Product Decisions
Like CIOs at larger companies, midtier CIOs have the most authority over decisions about vendors, spending and process initiatives, and are less involved in other business decisions. However, these CIOs are more likely than their counterparts at larger firms to be involved in decisions about products and services, probably due to SMBs' reliance on the CIO to oversee their business intelligence systems. As part of a smaller team of executives, CIOs at midmarket firms are also more frequently involved in executive hiring decisions.

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