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Published: July 17, 2002

 
 

CEO vs. CIO: Can This Marriage Be Saved?

Improving organization and communication will help chief executives and chief technologists form a more perfect — and profitable — union.

Illustration by Jack Unruh
A chief executive officer of a major industrial company in the U.S. heartland was speaking to an audience of chief information officers a year ago, discussing the role of the chief information officer in the modern corporation. In the middle of his speech, straight-faced as can be, he observed, “My CIO is probably my most essential manager. Without him, I don’t know where our company would be.”

The audience laughed. In fact, their laughter was more spontaneous and contagious than it was at any other time during that daylong seminar. The irony, of course, was that the attendees were completely unaware that the CEO was dead serious. For this assembly of CIOs, the idea that a CEO would call one of their number “essential” was, well, laughable.

The unfunny truth is that CEOs and CIOs too often act as though they are partners in an enormously uncomfortable marriage. That’s not to say that there hasn’t been some improvement, even significant improvement, in this relationship in recent years. In fact, at an increasing number of companies, there has been a growing emphasis on integrating IT operations into the most vital aspects of the business and on ensuring that technology plays a key role in future success. In a Booz Allen Hamilton survey of CEOs conducted in August 2000, 70 percent of respondents said that leveraging e-business is the most important or a very important issue on their agenda. And 89 percent of CIOs questioned at the same time indicated that there had been a clear, bona fide expansion of their responsibilities in the previous 24 months.

Still, in our experience, this progress is occurring generally only in large and established companies with enlightened management. In most organizations, there still is a long way to go before the CEO and CIO find common ground. It’s not that chief executives are Luddites who are ignorant about the potential impact of technology on their companies. That charge could perhaps have been leveled a decade ago. But most CEOs are now well aware that improved productivity (even if it can’t be easily measured) from advances in technology was the underpinning of the nation’s longest economic expansion. And many have accepted the conclusion that the Internet is forcing a reinvention of the way their companies do business with consumers, suppliers, and partners, and is fundamentally altering how their employees communicate with one another.

The problem is that most CEOs are interested in technology only to the extent that it adds value to the organization. To them, CIOs are experts only in technology and service delivery. Some other executive — the CFO, a business unit head, a sales manager, for example — has to point the CEO in the right direction before computers, networks, BlackBerrys, PDAs, mobile databases, and any other technology become integrated with the strategic direction of the corporation.

CIOs, of course, are not blameless in allowing this perception — this breakdown in the marriage, so to speak — to take hold. Although they often say that they aspire to more strategic involvement, few technology chiefs are skilled enough to align their agenda with their company’s agenda, and, just as importantly, with the business landscape in which their company must operate. CIOs should be defining technological initiatives in terms the business understands — speeding products to market, enabling growth, and reading costs and risks. If CIOs adopted that kind of approach, top management might be inspired to take them more seriously as partners in developing the company’s strategic direction.

Rather than embrace this opportunity, however, most CIOs tend to view themselves as corporate victims, shut out of the executive suite and seat of power through no fault of their own. This perception, which inevitably feeds a vicious circle, has a clear impact on CIOs’ careers: CIO longevity in the job averages less than two years, and the reason almost half of all CIOs wind up fired is that they fail to establish good working relationships with their CEOs and the rest of the management team. No wonder many in the industry believe that “CIO” stands for “career is over.”

 
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Resources

  1. David M. Katz, “It’s Good to Be King,” CFO.com, June 5, 2002; Click here.
  2. Terry A. Kirkpatrick, “Research: The CIO’s Role,” CIO Insight, April 1, 2002; Click here.
  3. Esther Schein, “Judging Tech? It Ain’t Easy,” CFO.com, March 5, 2002; Click here.