CIOs must focus on business not technology

business people under magnifying glassMy last article for The CIO Leader, CIOs should not be technical, prompted quite a lot of reaction across this site, LinkedIn and Twitter. The basic premise was that CIOs who were predominantly technical, or who at least were perceived to be technical were at a disadvantage to those that demonstrated a good understanding of the wider business. This was supported by a secondary point that CIOs that had spent part of their careers outside of IT were better placed to take on additional responsibilities or progress beyond the CIO role.

It’s worth noting that most of the feedback to my article was positive and in agreement with these points. In fact, the few negative comments about the piece were largely based on a misunderstanding of the central point; these people thought that I was saying that CIOs did not need to understand technology or that they should not have any technical background. This is not the case.

I recently took part in an Industry Leaders Panel at the Ovum Industry Congress and one of the subjects discussed was the skills that a successful CIO will need in the future. I reiterated that technical skills were of less importance than they once were and that wider business experience gave the CIO both the knowledge and credibility to be successful. Again the feedback after the session and on Twitter showed that there was broad agreement with this view.

However, there was again one or two comments that, whilst not directly disagreeing with my view about CIOs needing good business knowledge, were still making the case for CIOs needing to be ‘technologists” or at least having a technical background. One of the reasons given was so that the CIO could check whether what they are being told by their staff or vendors is correct.

With any CxO role a good understanding of the area for which one is responsible is a prerequisite. The same is true for the CIO role. However, does this really need to be deep technical knowledge acquired through time-served in the IT department? Or can it be experience gained through exposure to IT being applied in the real world, to solve business problems and enable new capabilities? And any good leader should know how to build a team they can trust, with the necessary specialist skills and experience. And they should also know how to ask the right questions to validate or test what they are being told, without being a subject matter expert, and when to seek a second or even third opinion.

One of the more frequent responses from people who don’t agree with my view is whether this also means that CFOs do not need to have a financial background. I have two answers to this point: firstly my main premise still applies; CFOs who are too financially focused (and hence not able to contribute beyond the role and remit of the finance function) are at a disadvantage compared to those that demonstrate a good understanding of the wider business in addition to a financial background.

The second and more in depth answer, is that it’s not a like-for-like comparison. The CFO role has existed for much longer than the CIO role, which is still relatively new. The fundamental role and processes of the finance function are fairly stable and are not evolving at such a pace. Hence the skills and experience required to be a CFO are also well-defined and understood; they have not changed significantly for many years and are unlikely to change much in the future.

The IT function on the other hand, has experienced significant change and will continue to do so for the foreseeable future. Disruptive trends such as consumerisation, cloud, mobile and social together with much better awareness and understanding of technology across all business functions are having a major impact on the role of IT and the CIO.

The maturity of the IT outsourcing market coupled with the availability of platform-, infrastructure- and software-as-a-service are gradually removing the need for IT departments to have large numbers of highly technical in-house resources. As a result the focus is shifting to how technology can be applied; identifying required capabilities, designing solutions and sourcing and integrating the required components is how IT departments will add value in the future. This requires different skills in business-facing roles.

And with technology increasingly becoming a source of competitive advantage and, for many businesses, a direct source of revenue, this change in the role of IT and the need for business-facing and business-focused skills accelerates further.

Leading this shift is the CIO, or it should be. If the CIO role does not evolve to reflect this change in the role of IT; if CIOs continue to be technically focused then they will gradually become less relevant, sidelined in favour of other CxOs who focus on the application and business value of technology.

And if there is some validity in the argument that CIOs still need to be technical then it’s only a matter of time before this argument does not hold up. The trend is clear; the CIO role is becoming less technical. This trend will continue as technology increasingly becomes both a utility and a source of differentiation for most organisations. CIOs who ignore this do so at their own risk. CIOs who embrace the utility model by focusing on the use of technology to enable and drive change and assume the role as their organisation’s broker of technology products and services will not only survive but prosper.

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  1. […] can read the rest of this post on The CIO Leader, my site for business-focused technology […]

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