Like this:

What will become of the CIO? Is there a future for this position or will it be absorbed by some other CxO position? The question resonates today across many organizations in various industries. Companies struggle to understand the role of the CIO. What does a CIO do to warrant a seat at the executive table? Although many CIO’s receive reasonable recognition with a leadership role at the operating level, few are truly perceived as part of the executive management team. CEOs simply do not see real business value in regular and meaningful interaction with the CIO. Survey after survey shows the number one issue facing the CIO is the lack of credibility they have as business leaders.

The problem rests with the “I”. It is simply impractical to be the Chief “Information” Officer. How can anyone realistically provide executive oversight of information? Information is not something you manage; information is something you use. Information is the analysis of data collected from the transactional systems used to run the business. There is an inherent conflict when any one person suggests that he or she will have executive ownership of information across the enterprise. The CFO will not relinquish control of financial information and the COO cannot be handcuffed without access to operational data and the head of sales needs competitive information instantly without making a written request to the corporate data team. Every functional head in the organization with direct line of sight responsibility demands control of the transactional systems supporting them and will define the information they need to make informed business decisions. More often than not the information cannot be found in pre-defined reports or management dashboards, it requires analysis or even some custom application development.

Let’s not confuse information with presentation. A report or management dashboard is typically not information. Aggregating transactional data in a concise and intuitive graphical format can be extraordinarily valuable, but it is not information. The memo that gets written explaining the data, analyzing results and forecasting future performance is information. For example, the monthly financial statement showing declining margins is not meaningful until it is explained. The explanation can significantly affect decisions resulting from the reported results. If the margin decrease is the result of a unique event having a short-term impact, then you may be inclined to overlook the results as a “blip”. However, if the change in margin is due to supplier price increases then the impact is more fundamental and other changes may be required to defend your profitability. The point here is that data is transactional and the reports or dashboards that present data add value but are not an end – they are a means. Information is contextual which requires the data found in reports and dashboards to be analyzed by people who use their intelligence, experience and intuition to interpret the data.

So the embattled CIO faces a crossroad. If the CIO cannot clearly define the value of their role relative to other CxO positions then they face the risk of being relegated to a pure support role as the head of technology operations or the “chief” technology project manager. This is a very insecure position. Many of these activities are being commoditized and outsourced. This will increasingly reduce the strategic value of the function and eventually lead to a mid-level line operations role at best.

Alternatively, the CIO can look into the “I” of the storm and see that the real strategic value of their position is not the control of systems, development or data and analysis, but the ability to integrate work flow across functional silos. As Chief “Integration” Officer the CIO changes focus from hardware and software to process and work flow. This change is already occurring in many organizations fueled by innovations in technology that enable many different systems to communicate with each other. The strategic value is not delivering the next system upgrade; the strategic value is creating connectivity between transactional systems to streamline business processes. The CIO becomes the primary integrator across the enterprise and assumes responsibility for identifying and removing bottlenecks in business process workflow. The CIO’s new responsibilities must include accountability for four critical areas:

1. Business Process Management – the CIO integrates business processes across the enterprise and guides the change management efforts required;
2. Security & Compliance Management – the CIO ensures that the business processes and systems include the controls to safeguard company assets and meet any and all appropriate regulatory compliance requirements;
3. Technology Strategy & Operations Management – the CIO delivers the technology tools and resources that the enterprise needs to conduct business; and
4. Enterprise Program & Project Management – the CIO provides executive leadership for enterprise-wide program and project management insuring that every project is a benefit to the organization.

Notably missing is the responsibility to use the tools and resources on behalf of the business. This means that analysts, developers and the like do not need to report to the CIO and in fact should not. In this model the responsibility to use technology to meet specific business objectives rests with the functional heads or line of business leadership that must execute against those business objectives.

The CIO has transformed from top techie to strategic integrator; a role that requires executive level leadership skills and defines a unique value proposition among peer CxOs.

Advertisement