Opening the door to the C-Suite: CIOs are in a unique position, often holding a helicopter view of what's going on in the business
- The CIO is still perceived as the organisational “watchdog” and leader of a support function
- 38% of CIOs report a lack of support from executive management team
- 60% of CIOs think they add strong value to fact-based decision-making when setting corporate strategy, yet just 35% of C-suite peers agree
As the business world evolves, CIOs can, and must, refresh the outdated perspectives that other executives still hold about their role in order to succeed, according to Ernst & Young’s DNA of the CIO report released today. The report, based on a survey of over 300 senior IT professionals globally, also draws on in-depth interviews with a further 25 CIOs and 40 respondents from across the rest of the C-suite, to capture business views about the CIO role today. Just less than half of surveyed CIOs were headquartered in emerging markets.
The DNA of the CIO in emerging-market economies
With the world’s eyes on developing countries as the engines propelling the global economy, what are the typical characteristics of CIOs in these countries?
- The term CIO is replaced with “IT director” which is commensurate with the smaller firm size albeit very fast growing
- IT leaders have slightly shorter tenures and tend to be younger: 39 years as opposed to 47 in developed countries
- They are more ambitious: 35% want a bigger CIO role, and 18% want the top CEO job, compared with just 27% and 4% among CIOs in mature markets
- While they identify the same target skills, they generally see a greater need to sharpen their skill set
- They appear to be better networkers, with closer ties, on average, to both the front office and stakeholders outside the business. Nevertheless, they’re rather less likely to be involved in their companies’ strategic business decisions
- Rapid-growth market CIOs are far more likely to hold an IT qualification: 60% hold a bachelor’s or master’s level degree in IT, compared with 40% of mature market CIOs
General Insights from the DNA of the CIO
The central role that technology has played in every industry and sector of business over the last two decades emphasises just how big an opportunity CIOs have already missed. CEOs are in clear need of “co-drivers” who combine technology expertise with business skills; however, too few CIOs are currently regarded as true members of the executive management team. While they have technological expertise, they are not perceived to have the right level of business skill – limiting their potential for change.
Ashwin Goolab, Africa Advisory Director at Ernst & Young comments, “The clear message from many CIOs, is that the status quo will need to change. In order to stay relevant in a rapidly evolving technological landscape, CIOs will need to break out of their comfort zones within the data centre. Those who don’t, will run the risk of being further relegated down the corporate hierarchy, or sidelined altogether.”
Securing a place in the C-suite
If CIOs are truly going to deliver on the potential remit of their role, and the potential of IT, they will need to work harder to secure their position at the top table. Less than half (48%) of the C-suite executives think the standing of CIOs has improved in recent years on a range of issues, from product innovation through to helping deliver on the operational agility of the company. While 60% of CIOs think they add strong value to fact-based decision-making when setting corporate strategy, just 35% of their C-suite peers agree, resulting in just 43% of CIOs reporting that they are deeply involved in strategic decision-making.
This low level of involvement is reflected in nearly four in ten (38%) respondents reporting a lack of support from the executive management team as a major issue, particularly within larger companies with revenues of over US$1b (46%). Most leaders aim to keep any discussions with the CIO centred on IT budgets, ignoring the chance to engage in a wider discussion about the value of technology. CIOs acknowledge that it will be difficult to change such perceptions of being a purely cost control function, but doing so will be a prerequisite for recasting the role of the CIO, and IT, within the wider business in the future.
More than IT budgets
Previously, IT leaders have not done enough to reach out to the rest of the business to develop long-lasting relationships that can support their wider change efforts. As befits IT’s long-running history as a cost control function, CIOs hold the closest relationship with the CFO, but CIOs recognise that by expanding discussions to encompass the CEO and other leaders, CIOs can move the conversation onto matters about IT value and its role within the business, rather than getting tied up in budgets alone.
Ashwin concludes, “Future CIOs will need to be able to show proactively how IT can be used as a source of innovation within the business, rather than merely a support function. Naturally, a part of this will be securing the chance to support a major business project of some kind, which can, in turn, make a specific impact on how the rest of the business operates. The value of this is clear: once business leaders start to recognise an IT leader as someone who can transform the way they operate their business, perceptions can quickly start to shift.”
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