The IT department isn’t what it used to be. Its role and its function within the organisation have been transformed, as the scope of IT’s application has grown. And the job at the top of the department has changed accordingly.
A decade or so ago, the role of chief information officer began to emerge in corporations, reflecting the perception of the IT department as the custodian of the company’s information resources.
But it is moving on again. Information is now so profligate and mobile, and the tools to create and edit information so widespread, that the custodian model has become outmoded.
The IT department can no longer settle for being a glorified filing cabinet for the enterprise – instead it must provide the business with the tools it needs to be the master of its own information.
And that requires a whole new understanding of business. To use an analogy, it is no longer sufficient to store the ingredients; the IT department is increasingly expected to come up with the recipe.
That poses a challenge to today’s CIOs, who more often than not have come up through the ranks of the IT department. Having spent their careers at a distance from the business, they are now expected to show initiative, implicit understanding and innovation around it.
The challenge is intensified by the presence of younger, more business-focused personnel to whom technology is second nature and deeply entwined with both their professional and personal lives. The race to become the new CIO is on.
“I was with a group of 15 CIOs the other day,” says Tony Eccleston, who has just joined Ernst & Young’s IT advisory from courier company DHL where, as group CIO, he was in charge of a half-billion dollar IT budget. “I asked how many were actually in charge of information. The answer was: not many.”
He points out that the scope has broadened, explaining that one CIO who described their remit as “cross-functional business process organisation” is typical of the new breed.
Those comments are echoed by Julian Ashley, a consultant for IBM Global Business Services, who was formerly in the office of the CIO at supermarket chain Safeway.
Ashley and colleagues are currently researching the evolving role of the CIO, having noted something of a change in duties among the CIOs with whom they work.
“The three traditional roles of the CIO were keeping the lights on, implementing IT-centric business change and aligning IT with business strategy,” he explains.
“Our hypothesis is that those roles are changing into keeping the business running, implementing business transformation and enabling business innovation.”
As the terminology suggests, these roles demand a much greater familiarity with the business than many CIOs can currently boast.
But this business experience is generally lacking, says Ernst & Young’s Eccleston. “For many IT directors and CIOs, the first time that they get to work alongside the business is when they reach the top job,” he declares.
It is certainly unfair to say that today’s CIO could be viewed as a mere technologist. In many organisations, the role often involves managing a string of third-party suppliers – a crucial skill for modern business. And that has a positive impact on their outlook.
“In some of the larger organisations, outsourcing has released the time of the CIO, so they can get involved in areas outside pure technology management,” explains John Whiting, managing director of the UK IT business at recruitment consultant Harvey Nash. “That means they have had to develop relationship management skills.”
But for today’s CIOs, as well as the IT managers who are looking to fill that role in the near future, the increasing importance of relationship management skills and business nous to IT leadership in the department could pose a threat.
Coming up through the ranks of the business is a generation of executives from both IT and the business who understand both and, as far as the CEO and CFO are concerned, might prove more suitable for the CIO position than veterans of IT.
“There is a very interesting breed of technology-business people in mid-level positions who have the skills that the business is looking for in a CIO,” explains Harvey Nash’s Whiting.
As he observes: “There is a wave of people now coming through into senior positions. Then there are the dinosaurs who are going to get leapfrogged. In fact, it is happening already.”
Adam Thilthorpe, manager of the British Computing Society’s professionalism in IT programme, says that IT is now seen as another route to the top of the business, and is attracting a new kind of candidate.
“Previous generations looking to get to the top would have probably gone down the route of law or finance,” he says. “But the ‘Y generations’ are looking at technology as a possible route because they understand that it drives business change and innovation. In the future, IT leadership will be completely synonymous with business leadership.”
So how can an IT professional avoid becoming one of Whiting’s dinosaurs? Tomorrow’s CIOs will be expected to have a greater affinity for business than at present. But their affinity for technology will still be their most valuable characteristic.
And one way to stay ahead of the curve is to promote and enable the changing role of information technology within the business, rather than resist it.
Of particular significance in this is collaboration technology, as it impacts the way an organisation communicates with itself, the way that it innovates and the way it interacts with its partners – all key success factors in modern business.
“The business imperative is to squeeze every ounce of competitive advantage out of what you have,” explains Whiting. “If that means changing the way we interact and collaborate with our partners, then that’s what we need to be doing.
“That’s why Web 2.0 is more than just a flashy buzzword,” he adds. BCS’s Thilthorpe agrees that this category of technology project can help foster an image of IT as a business enabler, not a drag on innovation. “Collaboration technology is one area where real technology innovation can drive the business forward,” he says.
Such projects are still well within the comfort zone of the IT professional. Thus, the transition to the ‘new CIO’ will require something altogether more soul-searching.
Also, she insists, the stereotypes are even more applicable for the rank and file of today’s IT department than the current generation of IT leadership. “Today’s IT directors got into the industry when it was brand spanking new,” she says.
“I think that it attracted a different, more intuitive kind of person that was more entrepreneurial than in IT today.”
Room for improvement
“Using the right brain is something you can learn but it’s a bit like learning to drive a car,” she says. “Anyone can learn the skills to a certain level of proficiency but they will never be as good as someone with a natural gift.”
That is not to say that the CIO cannot become a useful business leader, however (see The rare leap from CIO to CEO). And naturally there is always room for improvement.
Indeed, according to Alistair Russell, development director at CIO Connect, it is those IT managers that have taken care to augment their skills throughout their career that are being plucked for the CIO position.
“I am seeing CIOs coming from both IT and the business side,” he says. “The thing that it is differentiating between the IT people is whether or not they have been developing their skills throughout their career.”
Ernst & Young’s Eccleston also places high value on professional development. For good measure, he thinks that relationship management is “one of the key development areas for people from IT to make the transition to best-in-class CIOs.”
And like learning a language, Eccleston believes that the best way to develop business fluency is to immerse oneself in it. “I would always encourage people to seize any opportunity to get cross-functional exposure,” he says. “Simple things come out of that, such as speaking the same language.”
Indeed, the aspiring CIO should be looking to develop business skills just as much as technical know-how. “People who are aspiring to the role of CIO should be heading for tomorrow’s CIO role, [not today’s],” says IBM’s Ashley.
“I think it’s a great opportunity if they are prepared to grasp it.”
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