Transforming Banks for a Digital Future: The Winners, The Losers, and the Strategies to Beat the Odds
CIOs were once the consummate corporate insiders, focused on internal systems, internal customers and internal IT staff. But today's CIOs are out in the wider world, doing work that has more in common with a secretary of state than a systems developer. Just ask David Shea. As the CIO of Imerys SA, a global mining and manufacturing company, Shea recently spent two weeks in Frankfurt, Germany, meeting with the IT staff of a local operating unit. His job today he says, requires not only his technical expertise, but his people and leadership skills as well. "We not only encountered cultural issuesthings like language and vacation practices that differ country by countrybut we had to work with local operations that are accustomed to being autonomous," Shea says.
CIOs are being asked to confront a much wider range of issues today, many that extend past the technical and into the economic, political and even social areas of business. At times, the job can resemble that of a political office, with constituencies that are often far-flung.
The shift to a more global approach to IT management is evident, and Shea is not the only CIO whose passport is seeing action. More than half of CIOs in large companies have held international responsibilities. Jack Cooper, now a consultant, traveled abroad often as CIO at Bristol-Myers Squibb Co. for seven years and prior to that at Joseph E. Seagram & Sons Inc. for six years. "There are cultural differences, country by country," he says. "And there are cultural differences in the U.S., state by state. There are cultural differences within an enterprise, from sales to manufacturing to research. A good CIO can adapt to those differences. The key is to be able to put yourself in the shoes of the other person and to look at the problem from his perspective."
With overseas units and a host of other constituencies to keep happymanagement, IT staff, customers and othersthe CIO of 2002 resembles a gladiator now vying in a much more complex political arena. In school, Gregory Coan, vice president and CIO at Textainer Equipment Management (U.S.) Ltd., majored in political science and history, and every day, he says, he uses the skills he learned in those disciplines. "The number-one skill is the ability to communicate, but also how to think critically and write well. We could stand to have fewer computer science majors and more social science majors as CIOs, because of the people skills, the ability to use rhetoric, to establish positions and sell them. Part of your job is being a salesperson. The success of any endeavor is ultimately perception. You have to win the hearts and minds of end-users and make them believe it was their idea."
Of all the attributes a CIO needs, our respondents rated leadership and communication among the most critical. "A lot of the CIOs out there are trying to improve these skills," says Anton Hios, who runs a Giga Information Group Inc. program for CIOs. Interest in this among his members has been growing steadily for several years, he says, because their nontechnical advice is increasingly sought at the executive level in such matters as how the company can be more innovative, build better strategic alliances, even make decisions about facilities. "CIOs probably deal with more people across the whole organization than other executives," he says.
Our respondents rated business understanding as the most important attribute, technical acumen the least. "We find lots of CIOs who don't come from technical backgrounds," says Ellen Kitzis, group vice president for executive programs at Gartner Inc. "They're transferred from business units where they've proved their skills as business executives. The role of communication and financial management is as important as technology management. We assume a good business leader can find the right technical talent and put it in the right place."
Given the increasing complexity of their roles, it's not surprising that six in 10 of our respondents think their jobs are more difficult than a year ago. "Yes, it's gotten harder," says Mark Endry, senior vice president and CIO at J.D. Edwards & Co. in Denver. "As companies use more technology just to run the company, technology becomes a must-have and not a nice-to-have24x7 is required, it's not an option. You could come in under budget this afternoon and something somewhere goes down tonight and erases all your brownie points. You never get a break. Cost and budget pressures are always there."
Few respondents ranked cost-cutting as a top priority. This, Coan says, may reflect the fact that CIOs see cost-containment as a given, "as the price of admissioncost control is always an issue."
"I'm surprised costs don't get more attention from the CIOs. Don't they get it?" says Dudley Cooke, CEO of Ardmore, Pa.-based consulting firm Liberty Business Strategies Ltd. Cooke is a former CIO and now heads up The Conference Board's Council of CIO Executives. "The big pressure I see today is that the CEO is concerned with costs."
Perhaps, Kitzis says, they see costs as only half the equation. "Simply being a cost reducer isn't being seen as an effective executive. You have to deliver valuefor example, introducing a new business process to support a marketing initiative, while holding costs down."
One thing that seems to have eased is the recruitment and retention problem. "Things have settled down and become a lot more reasonable," Coan says.
"Recruiting talent right now isn't a top priority," Kitzis says, "although they continue to have the problem of finding the right skills." And, she says, CIOs are increasingly looking for untraditional people, from marketing and communications, for example, who can work with the business units and market IT within the company.
Given all the issues before them, however, our respondents seem to relish their work; only a tiny percentage see themselves in a future role away from technology.
"I'll always be staying close to technology," Endry says. Shea agrees: "I'm having so much fun I don't know that I want to shake it."
They're on to something, Cooper says. The next big thing is bridging information systems across the enterprise, from supplier to customer. "This is going to take a lot of infrastructure and IT systems, but it has enormous payoffs," he says. "It's going to be big. This is a very exciting time to be a CIO."
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