Do You Need a CTO?

Oct 12, 2004

Allen Bernard

CIOs today are faced with many decisions and fewer and fewer of those decision have much to do with technology per se and much more to do with how technology affects the operations and long-term prospects of the businesses they are in.

Because of this, today's CIOs often come from non-technical disciplines. Obviously, they have to understand technology but they also have to be good managers with a solid set of business skills that a CIO of even five years ago may have lacked.

And, as companies lean more and more on technology for productivity gains and business process streamlining, vendor partnering and other B2B network integrations, ecommerce activities, etc. the need for someone to decide exactly which technologies are the right ones to accomplish the business' goals could become increasingly crucial and common, said Jan Sibley, vice president of ThoughtWorks, a systems integrator, and a former CIO at Washington Mutual Home Loans

"It could be an emerging trend based on the factors of the world we live in today," she said. "The amount of data trafficked now was incomprehensible 10 years ago. The security issues, the vendor complexities, the things introduced by homeland security, for example, are daunting in a way that I don't think were daunting before."

Today, CTOs are more commonly found in either start-up companies too small for a traditional CIO and technology companies whose main focus is looking into the future in anticipation of the next great product trend, said Ryan Jones, a venture capitalist with Commonwealth Capital in Boston.

"The CTO is most valuable when there is a great deal of change in the development of the product and the market into which the product is launched," he said.

But, because the IT landscape changes so rapidly for users as well, expanding this idea to include the enterprise reveals a CTO can perform the same function but in an internal-facing role, said Sibley. In this role, the CTO (often reporting to the CIO) takes a strategic blueprint of the company's goals and figures out where and how technology can help accomplish those goals.

While many companies have people on staff to fill this role, the CTO's position is different than one in which a non C-level manager must make technology purchases based on other's recommendations or a corporate wish list. Having a C-level decision maker changes the nature of the role adding weight and authority to the person's opinions, said Jeffrey Neal, group president - West for the IT staffing firm Kforce.

"I don't think its just a title," he said, "because, typically CIOs aren't necessarily hands-on technologists. So the more technology that's being leveraged within a firm" the more often a company will need a person who knows what technology is going to be appropriate -- per the vision of the CIO -- to integrate with the company's corporate vision and goals.

There are no steadfast rules when to hire such a person, said Sibley. But as CIOs increasingly find themselves under pressure to take on more and more responsibility for their company's success, there will come a point where many realize they can no longer function effectively on both sides of the job.

In short, they will need someone to take over the purely technical aspects of their jobs while they concentrate on more strategic things like IT/business alignment.

"If this continues, this trend, there could be a point where (CIOs) say it's just to big, it's too big a role" for one person to handle, she said.


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