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Published: July 17, 2002

 
 

CEO vs. CIO: Can This Marriage Be Saved?

Defining a company as technologically savvy can pay big dividends for a CEO. It attracts investors and analysts because it paints an image of a company discarding old business models to create a modern organization taking the kinds of intelligent risks needed to succeed and add value to the company in today’s complex business environment. And that’s where the CIO’s communication responsibilities come in. If the chief executive is a technology champion — someone willing to bridge the gap that separates the executive suite from the technologists’ bullpen at many companies — then the CIO must become the CEO’s very visible partner in this effort. CIOs may not have had the chance to develop internal managerial skills, but they must acquire them in order to present business rationales and carefully calculated return-on-investment scenarios. Similarly, CIOs must develop the ability to articulate to the press, industry leaders, Wall Street, and nontechnical employees the company’s core technology vision and how what flows from this vision will impact the organization’s financial and operating performance.

At most companies, CIOs are not public faces and usually aren’t complaining about it. They may eagerly speak at a technical conference arguing an engineering point relating to a wireless network they’re installing, but we can’t recall the last time a CIO appeared on a quarterly earnings analyst call to describe how the just-completed customer relations telecommunications system will impact revenue and profits in the coming year. That just exacerbates the suspicion among CEOs that their chief technologists are not business leadership material because such a large part of the job of any corporate executive is publicly advocating the company’s vision and strategic priorities. Kinko’s Chief Technology Officer Allen Dickason calls it being a translator and readily admits that it is a critical part of his job and, equally important, an essential skill if the relationship between him and the CEO is to be productive and respectful. “I have to be able to explain in plain English the details of the technology strategy that the CEO is alluding to,” he says. “If I can’t translate the excitement and the innovation in plain words — not techno-babble — that anyone can understand, whether they’re a business unit head or an investor at a road show, then I’m failing in the communication aspect of my job.”

Process Management
Process is the most difficult part of the CEO–CIO relationship to navigate. Even with the best intentions, it can take a long time to truly integrate the CIO into the core activities of the company’s business units — in other words, to make certain that the CIO is involved in day-to-day supervision of the numerous processes driving the company that are linked to technology, whether customer relations management, factory floor automation, sales and marketing database development, or something else.

Most CEOs are too “hands-off” to recognize whether this level of coordination between the CIO and the business units is occurring. The relationship can be crucial to the company’s success, however. It’s certainly necessary to ensure that technology expenditures — often among the costliest budget items — are not wasted and, in fact, are leveraged throughout the organization. But most CIOs are too unskilled in company politics and too uncomfortable with nontechnical performance benchmarks to deftly insert themselves into strategic corporate processes, those that go beyond simple networking. And that’s where the CEO–CIO relationship breaks down. The CEO neglects how technology is being implemented at the company — no matter how supportive of technology that CEO is. And the CIO often is unable to be an aggressive tactical manager.

One of the few examples of a company that has successfully bridged this gap is a Midwestern industrial giant, whose CEO has demanded that when the CIO heads an initiative, he is responsible not only for developing and installing the system itself, but also for managing (or comanaging with the business unit chief) the value that the system brings to the company. For instance, the CIO tackled this dual role when redesigning the company’s customer-service system through the first few stages of its launch by having customer-service staffers report directly to him as well as to the head of the business unit. This way, the CIO had supervisory-level access to the employees’ frontline input about the technology, and he could continually assess without interference or bureaucratic struggles which areas of customer service improved or failed under the new system. Based on these results, the CIO was able to fine-tune the technology to meet certain company performance and value benchmarks that he measured himself, not just technical specifications.

 
 
 
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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.
 
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