Is the CIO Obsolete? - Page 1

It is painfully evident in many of the ads for “so-called” CIO’s we see advertised in most of the on-line job boards or regional newspapers. Requiring “in-depth” knowledge of specific applications or technologies, mean it’s obvious these roles have been defined by someone with no clue of the true nature of the CIO. They see the role as “technical” as opposed to a true business leader and change agent.

It’s not that what they are seeking is wrong, it may be that they really need a technical leader to keep things under control, but don’t call it a CIO.

I used to have a simple metric as to whether the role called “CIO” was in fact strategic, it was a simple question which defined the nature of the role. Tell me where the role reported, and I’ll tell you where it’s focused. If it reported to the CFO, then it was not (in general) strategic, it was a financially focused role, viewed as a “cost of doing business” within the organization.

I have had CFO’s ask me why the head of IT was more important than the head of the Facilities department, explaining: “We can’t operate without computers, but we also can’t operate without the right buildings either.”

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I’ve been increasingly pessimistic about the growth of the role over the past decade, evidenced by a relatively flat percentage of CIO’s who report at the highest level being stuck at around 40% and showing no movement for years. This means the bulk (60%) of CIO’s are CIOs in title only.

I recently saw some corroboration around my thinking by none other than the famous Jack Welch, former chairman of General Electric in a recent Business Week column titled 'A Twisted Chain of Command,' which I strongly suggest you not only read, but print out and save in a binder

Complaining about the “Rasputin-like dominance of the CFO” in the organization, Welch says “… it’s not going too far to say that chief financial officers, and very often do, wield too much influence within companies. And if it’s not the CFO, it’s the so-called chief administrative officer, who has excessive power, overseeing finance itself, human resources and any number of other staff departments.”

Welch continues, “So why does it happen? With IT, the explanation is easy: It’s an historical hangover. Initially, IT was mainly seen as good for lowering costs and increasing efficiency. In those days, decades ago, there was some logic to having IT report to the CFO. Most good companies, however, took IT out of finance when its broad strategic utility became obvious.”