Are CIOs at Risk?
The New Reality for Customer Engagement
CIOs suffer from shorter tenures than many other senior executives. In today's business and IT environment, achieving career stability is no easy task.
By Samuel Greengard
There's perhaps no executive position in today's enterprise fraught with as many challenges as chief information officer. As organizations look to go digital and meld mobility, cloud computing, social collaboration, big data and a spate of other initiatives with legacy systems, the pressure to perform is extreme. "CIOs are under a tremendous amount of scrutiny," says Daniel Benton, global managing director at Accenture. "It's an extraordinarily difficult time to be a CIO."
Various surveys, including a recent Janco Associates report, peg average CIO tenure at four to five years, though many CIOs wind up leaving organizations in less than three years. Although some CIOs face unreasonable demands and are hamstrung by tight budgets and unrealistic expectations about digital transformation, a growing number of them aren't equipped to address the growing challenges of today's business and IT environment. Many are mired in legacy systems and outmoded processes that make it difficult to drive performance, Benton points out.
How can CIOs break free of these challenges? According to Accenture, there are takeaways from high-performing organizations, where 84 percent of global CIOs have been in their role for more than three years. Benton says that success spins a tight orbit around three areas: an ability to deliver reliable IT at a reasonable price; a high level of agility ("The CIO can't be seen as getting in the way of what the business wants," Benton notes), particularly amid rapidly changing conditions and technology; and fostering a culture of innovation with the necessary IT to support the initiative.
The best CIOs, Benton says, successfully meld the emerging digital enterprise with legacy systems and processes. "There's a need to marry old and new technologies and create an environment that's somewhat like an R&D incubator," he explains. "It's almost as if the CIO must manage two different IT organizations that have to work in concert with each other."
There's also a need to generate business value from information technology. This means speaking the language of business and leading the discussion about business and IT strategy, Benton says. Part of the task revolves around hiring employees with different and sometimes non-traditional IT skills. There's also a need to recognize a changing power dynamic that incorporates CMOs, COOs, finance executives and other leaders, who increasingly drive buying decisions and procure cloud-based services on their own.
A 2013 CIO Survey conducted by executive search firm Harvey Nash USA found that the proportion of IT departments where 10 percent or more of IT spend is controlled outside the IT department increased from 23 percent in 2011 to about 40 percent in 2013. "There is a strong shift toward a more collaborative and multi-skilled CIO," notes Bob Miano, president and CEO of Harvey Nash USA. Moreover, Harvey Nash reports that CEOs increasingly expect CIOs to prioritize projects that "make" money over "saving" money by a 62 percent to 38 percent margin.
To be sure, the job requirements for CIO are changing. "It's not only long-term technologists who hold these positions, it's increasingly people who have worked on the business or non-technology backgrounds that are assuming the role of CIO," Benton explains. This trend points to a need for a broader understanding of IT, including the behavioral and cultural components of using technology. In addition, BYOD, app development, social media and other areas represent a new and critical frontier.
"The best CIOs drive the innovation discussion and debate," concludes Benton. "They understand the components of being a digital business and develop the agility to operate successfully in today's business climate."
About the Author
Samuel Greengard is a contributing writer for CIO Insight. To read his previous CIO Insight article, "Software-Defined Networking Takes Shape," click here.
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