What do leading CIOs think tomorrow’s IT leader will look like?

Joel Dobbs.GIFGuest post by Joel H. Dobbs

Joel H. Dobbs is the CEO and President of The Compass Talent Management Group LLC (CTMG), a consulting firm that assists organizations with the identification and development of key talent and with designing organizational strategies and structures to maximize their ability to compete in the business worlds of today and tomorrow. He is also an executive coach and serves as Executive in Residence at the University of Alabama at Birmingham School of Business.  Joel is also a popular and frequent contributor to the Executive CIO Forum where a version of this article was first published.

  

“The future ain’t what it used to be”—Yogi Berra

 

I read an interesting piece by Dan Woods recently on the Forbes website that, among other things, speculated on the “New role of the CIO.” Mr. Woods summarized the observations of several individuals including Michael Dell, Vivek Kundra, Marc Benioff, and Paul Maritz. Here is his summary of what these IT leaders think collectively about what the future CIO will look like:

 

  • Too much IT money and time are spent on infrastructure tasks such as building data centers, constructing servers, and performance tuning that are better accomplished by outsourcers.

 

  • The IT monopoly is over and it does not make sense to ignore that fact. CIOs cannot lead by saying no and exerting control. Rather CIOs must earn a leadership role based on their superior ability to manage complexity and their understanding of how technology can support the business.

 

  • CIOs are now, in effect, service brokers. They should act as portfolio managers assembling a coherent set of offerings from a variety of sources.

 

  • To be effective service brokers, CIOs must build skills in product management, product marketing, and customer satisfaction.

 

  • In order to bring focus to their efforts, CIOs must pay attention to identifying the core value-creating business processes.

 

  • Social media should not be confined to marketing but should be used by the entire company to create “big ears.” The CIO must embrace social media in internal and external communication.

 

I think these observations are right on target. For some time I have believed that the CIO role will bifurcate in the future into one of two roles. In fact, in many companies this is already happening.

 

The first path is the technology manager. This represents a failure of the CIO experiment and will likely be most prevalent in low margin/low tech industries and in companies who have suffered a series of IT disasters and failed to learn from them. It may also exist in some companies who have chosen to outsource all but the most basic of IT capabilities. In this scenario, which I believe will be the minority, the CIO role and title disappears to be replaced by a heavily operationally-focused manager who is charged with keeping costs low and availability high. In short, a reversion to the early days of “data processing.”

 

The second, and I believe (at least I hope!), the most common, will be the continued evolution of the CIO into what is essentially a divisional president where his or her role involves operating a line of business complete with P&L responsibilities. We are already seeing this in some industries. Perhaps the earliest example was American Airlines Sabre reservation system which eventually became a profitable line of business. For these CIOs the focus shifts from the cost to the revenue side of the business. Their primary focus will be on generating new sources of revenue and finding and exploiting new lines of business. We began seeing this in several industries, especially banking and financial services, several years ago. This is very different from the roles performed by most CIOs today. In fact, I seriously doubt that these folks will have any direct responsibility for the bread and butter of most CIOs today which consists or operations, data centers, networking, etc. All of these will be outsourced or disappear into the cloud.

 

To succeed in this new role I believe that the CIO will need to possess competencies in three core areas: business savvy, leadership, and application of technology. I have summarized these on the diagram here.

 

essential CIO capabilities.PNG

 

The ideal CIO will be someone who can function consistently at the intersection of these three circles. Now, granted, CIOs have always needed these competencies but frankly few possess competence in all three areas. In tomorrow’s world, these will be the price of admission.

 

One important point: Notice that when talking about technology the focus is on the application of technology. There is a big difference. Understanding how technology works is important, but understanding how to apply it to generate new lines of business or sources of revenue will be essential.

 

All of this begs the question, “Where will these new CIOs come from?” Some will no doubt still come from within the IT ranks but I believe that a growing number will be people who are essentially internal entrepreneurs. They probably will have had experiences in various business and technology functions, probably in multiple companies and industries. Many will have formal business training in the form of MBAs or other advanced degrees. All will be creative risk-takers who are at their core are creative, smart and confident. In short, they will be more generalist than specialist, more visionary than operational, more executive than engineer.

 

This will not be an overnight transition but it is already happening in some companies and will be commonplace sooner that most of us think. The important thing is to begin preparing now. Current CIOs need to carefully assess their current roles and, if you are still a few years from retirement, begin looking at how to get the experience, coaching and training you may need to evolve. All organizations should look carefully at their succession planning for the CIO role and make sure that they are grooming people for the future, not for today.

 

Related links:

White Paper: "Hardball: The State of CIO personal effectiveness and what can be done to boost it." (HP and IDG)

 

Other guest posts by Joel Dobbs:

Labels: CIO of future
Comments
JoshuaBrusse | ‎06-01-2012 10:15 PM

Hi Joel

 

Thanks for again a very good blog. I was wondering for years already why the split between Demand and Supply was not done in IT...it seems indeed that the time has come that we will have COO type of roles (covering the supply) and that the CIO role will focus more on demand. That would be very sensible and good for the IT<>Business integration (or even better IT embedded in the business) where I was waiting for many years already.

 

I agree that it will not be an overnight transformation but at the other hand it can also not take too long. The market is changing very rapidly, workforces and work habits are changing very fast andI believe that the future customers of IT delivered services have other demands much earlier than we anticipate now…so agility is required for IT organizations to changes the way they do business and thus change their leadership…

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