CIOs More Strategic than Ever

By Allen Bernard

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In conjunction with the launch of its Center for CIO Leadership earlier this month, IBM released a study from MIT and Harvard that shows 80% of the 175 CIOs polled now considered valuable members of the executive leadership team.

This is a dramatic shift from a 2006 IBM study that indicated 86% of CIOs were still longing for this opportunity. The huge swing is partly attributed to the survey’s geography—most respondents are CIOs of N. American companies. But, said Harvey Koeppel, the center's executive director, the swing is also indicative of the increasing realization by other members of the c-suite of the importance IT plays in the strategic direction of their businesses.

According to the study, “Senior management increasingly recognizes technology as central to innovation and competitive advantage. As a result, more and more CIOs are gaining a prominent seat at the table in their executive teams and playing an active role in strategic business decisions.”

This said, only about 69% of CIOs are actively involved in strategic decision making. A significant number but one with room to grow.

The survey further reveals that organizations with high levels of IT involvement in strategic decision-making also rate significantly higher on the following measures of IT performance:

  • Company views the IT function as an enabler of business performance;
  • Company has effective IT/business relationships at levels below the CIO;
  • IT employees have the knowledge and skills to communicate effectively in business terms;
  • IT initiatives and plans are well-aligned with the overall organizational strategy; and
  • IT and business managers collaborate systematically Thus, it seems that the CIO’s presence “at the table” may catalyze more effective IT-business conversations across multiple levels of the organization.

    While these results are encouraging, challenges remain, said Koeppel. Globalization and nations such as India and China are putting a strain on the existing talent pool. Many recent surveys indicate the No.1 priority for IT departments today is finding and retaining good help. And, with the looming retirement of many Baby Boomers—the first “official” Baby Boomer applied for Social Security benefits earlier this month—this situation may not let up for some time.

    According to the survey, “’Identifying and developing high potential IT staff’ is considered above average importance by 78% of respondents, while nearly a third of respondents (31%) consider this one of their highest priorities. It is worth noting that IT staff development is significantly more of a concern to U.S.-based CIOs than those in other countries.”

    For many CIOs, another concern is bettering communication with line-of-business managers. According to the study, “Fifty-three percent of respondents consider ‘promoting collaboration between IT and lines of business’ to be a highest priority. Yet only 15% believe they are extremely effective in doing so, while nearly a quarter (23%) rate themselves at or below the average.”

    Yet, for many CIOs, these two areas are the ones they feel the least adept at. It is for this reason, and generating “good will” among leading CIOs, said Koeppel, that IBM launched the Center for CIO Leadership. CIOs need help in surmounting multiple challenges: they are no longer just in charge of bits and bytes, but responsible for innovation, process improvement, leadership, strategic differentiation, tactical execution of process, productivity improvements, compliance, security, etc., etc.

  • It will take a new kind of CIO to juggle all of this and still remain in control of how technology is used and distributed throughout an organization. He or she will have to be part geek, part politician, part leader, and part visionary. This is where IBM, though collaboration with other groups such as MIT and the Harvard Business School, is hoping to make a difference.

    "The new Center for CIO Leadership will enable CIOs to share and learn in a community environment in a way that will enhance the profession," said Linda Sanford, senior vice president, IBM enterprise on demand transformation, in a statement. "Our survey research indicates that CIOs and their teams are looking to break out and create new value and long term growth for their companies, and the education, learning and collaboration provided by the Center for CIO Leadership will help accomplish this."

    Are We There Yet?

    For those CIOs still struggling to make it to the “strategic” level, the survey offers some helpful hints. Strategic CIOs are better at:

  • Promoting collaboration between IT and businesses;
  • Persuading senior management of the importance of IT;
  • Contributing to strategic planning and growth initiatives;
  • Identifying opportunities for business process automation and enhancement; and
  • Improving internal and external user experience and satisfaction.
  • To do this, these CIOs are less technical and more focused on and have better developed “soft skills” that allow them to bridge the communication and leadership gaps that exist in any organization:

    Political savvy: Can effectively understand others at work and can use such knowledge to influence others to act in ways that enhance one’s personal and/or organizational objectives.

    Influence, leadership and power: Can inspire and promote a vision; can persuade and motivate others; is skilled at influencing superiors; and can delegate effectively.

    Relationship management: Can build and maintain working relationships with co-workers and external parties; can negotiate work problems without alienating people; and can understand others and get their cooperation in non-authority relationships.

    Resourcefulness: Can think strategically and make good decisions under pressure; can set up complex work systems and engage in flexible problem-solving behavior; and can work effectively with senior management to deal with the complexities of the management job.

    Strategic planning: Can develop long-term objectives and strategies and translate vision into realistic business strategies.

    Doing what it takes : Perseveres and focuses in the face of obstacles; and can take charge and stand alone, yet be open to learning from others when necessary.

    Leading employees: Can delegate to employees effectively, broaden employee opportunities, act with fairness toward direct reports, and hire talented people.