In my more than twenty years in the industry and over a decade in consulting, I have spent time in about a thousand IT departments across a diverse range of organizations. Too often, it wasn’t pretty.
As a consultant, I am often responsible for assessing IT departments. In addition to the standard measures of basic IT performance, I started asking business line leaders for simple letter grades (A – F) in response to a two-part question: “How good is IT at getting your team information that both enables performance improvement and drives new opportunities?” Alas, responses above “C” have been rare.
The tenure of a CIO is infamously brief, shorter than an NFL running back’s career. In the last few years, it has become harder than ever to be an effective CIO, and increasingly difficult for companies to find a successful, lasting IT leader. What’s going on?
1. The role is uniquely diverse
The list of responsibilities for a CIO spans a much broader range than those of other C-level positions. For example, a CFO is responsible for accounts receivable and payable, financial planning and analysis, budgeting, accounting, and perhaps payroll and sourcing. By the time someone takes on the CFO role, most have worked closely with many of these functions during their careers. The unique characteristics of each are not profoundly different. Also, because these areas constantly interact with most or all business lines, future CFOs get a de facto education about other organizational functions.
Let’s compare this with a CIO, who is typically responsible for application implementation and support, help desk, IT security, programming/coding, data management, business intelligence, voice and data networks, purchasing, project management and more. Each of these arguably distinct fields has undergone seismic change in just a few years. Examples include moving from production data centers to the cloud, the explosion of security and privacy problems, the transition from retrospective reporting to “Big Data” with real-time prescriptive analytics, programming languages coming and going, mobile devices and moving to a flexible, liquid or global workforce.
2. The path to the CIO position can be problematic
Usually someone gets to be a CIO through exceptional performance in one of the above “silos;” by being a marvelous developer, a successful project manager, terrific business systems analyst, etc. Unfortunately, excelling in an IT silo can require a near-complete focus within that specialty – so terrific programmers often are unfamiliar with hardware or networking technology, and great database and Business Intelligence folks often are in the dark regarding the use of cloud services. Additionally, too many IT departments lack structural, continuous integration with business lines, so many IT career professionals are not schooled in marketing, sales, finance, production, care delivery, logistics, supply chain, transportation, etc. Ironically, the path to becoming a CIO can be a handicap in being an effective executive.
3. Organizations may not know what “good” looks like
To make matters worse, many organizations – boards, CEOs, other executives – do not know what a CIO can or should do, what an industry-leading IT function can contribute. Some basics—keeping systems available, operating and capital budgets under control, hackers at bay, projects delivered on time and budget — are universally understood. But how many companies can answer questions such as:
• How good is your IT department at delivering actionable information?
• Are you getting exceptional value for your IT investment? (ROI on IT spend, anyone?)
• Can IT deliver information that can improve performance across the organization? Make our sales force more effective? Improve patient care? Reduce receivable days? Extract better contracting terms? Improve the recruiting and retention of employees? Make acquisitions, integrations and carve-outs more successful?
There are few or no “business value” measures for IT, but asking these questions is a great place to start.
Stay tuned for future posts which will address solutions. A preview: how to structurally integrate IT with business lines, fuse processes with overall business objectives, develop meaningful performance indicators, build great teams and learn the business. I’m interested in hearing about your experience and your thoughts.
Execrank
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