CIO influence waning?

Friend and fellow Irregular Sadagopan recently penned a thought-provoking article at Sandhill.com discussing the changing role of the CIO:

Meet the New CIO

...Historically speaking, the CIO role was created to signify an increasing sense of awareness that information had to be managed similar to other important resources such as people, finance and materials. This required managers to plan, budget, evaluate and use information efficiently and effectively.

This new function of managing centered around information called for a different breed of manager – one capable of understanding the management of information and IT in the context of the business’s priorities and challenges. Today, across industries, leading-edge enterprises are completely dependent on IT as their internal engine. When the business model needs to be adapted, changed or shifted to changing economic or market circumstances, it turns to the IT engine to make it happen.

Paradoxically, in this information age, corporate data is increasingly becoming a company asset. While data and information may not manifest on the balance sheet, these are critical business enablers and differentiators not unlike Google's brand or 3M's innovation culture. Gartner recently did a survey with Forbes magazine that found fewer than 50% of CEOs surveyed hold the CIO responsible for the strategic exploitation of information today, but expected that that the CIO would wrest back this responsibility in the coming years...

I encourage you to read the article in its entirety. Sadagopan is an executive with Satyam (recently re-located to the U.S.) and works directly with CIOs of some of the world's largest companies. He goes on to discuss the challenges traditional CIOs face in establishing themselves as strategic decision-makers within the enterprise.

Coincidentally, InformationWeek recently published its own analysis of the changing role of the CIO. It noted that the Society for Information Management recently found that just 31% of CIOs report directly to the CEO. M.S. Krishman, who chairs the BIT program at the University of Michigan said:

"It's IT that runs every business process today," Krishnan says. "And while the IT department takes the responsibility for running those processes--the applications are doing fine, transactions are going great--they don't take ownership."

But somebody will take ownership, he predicts, and soon. "As companies become global, this will become a critical position," Krishnan says. The overseer might be called one of several things: chief operating officer, chief process officer--or chief information officer. But if the CIO doesn't step up, he predicts, "the CIO will be subsumed."

His comments take me full circle. One of the first conversations I ever had with Niel Robertson revolved around the need for Chief Process Officers to emerge. At the time, I was skeptical about adding another layer of CxO complexity in an IT constrained environment. But he countered that the strategic demands of IT would make this an inevitability. I'm still not sure a CPO is the answer, but I do think that the evidence is mounting against CIOs who don't have line of business experience and understanding.

What do you think?

sadagopan cio sandhill.com informationweek woodrow enterprise irregulars

Comments

[Jason Wood]

I think with all things, there are no absolutes. At the best run organizations, the transition is already underway (or has happened) whereby the role of the CIO has changed with the times and the men/women in place have adapted successfully. I think the more interesting question is whether BROADLY there is a seachange occurring and, if so, where the CIOs of tomorrow are going to come from. The days when an MIS director could move into a CTO role and then CIO or some such thing seem far gone.

[vinnie mirchandani]

actually Randy Mott at HP is a showcase CIO with his backrgound at Dell, and Wal0Mart prior, both known an innovators in IT.

And Mark Hurd talks so proudly of his IT ...like few corporate CEOs do

so at least at HP, not a sign of CIO influence waning...

[Thomas Otter]

Jason,
I find myself meeting CFO's who are very tech savvy, who have the respect of the CEO, and have a broader vision for the CFO's role.

The CIO in many organisations reports to the CFO.

I have seen a couple of cases recently where a CFO in waiting has been made CIO for a couple of years before moving up to the CFO role.