White Papers

March 2005

CIO’s at the Crossroads

By Gartner Vice President, Tim Ogden

According to Ellen Kitzis and Marianne Broadbent, VPs at Gartner, CIO’s today stand at a crossroads. The role of CIO is changing due to two perspectives on IT. On the one hand there is the lingering disaffection with IT from the Internet bust and the technology capital spending overhang. On the other hand, business executives are desperate for innovation, the regulatory environment has put far more emphasis on the completeness and accuracy of corporate information, and technology is playing a foundational role in virtually every product and service.

Broadbent says standing still is not an option for CIO’s. “Every CIO will follow one of two paths based on these perspectives. The path influenced by the view that IT is a commodity lays the foundation for a role that might be called ‘chief technology mechanic.’ The other path, influenced by the view that sees IT as the heart of every significant business process leads to a role we call the new CIO leader; it’s a role with all the respect and responsibility of other senior executive positions. It’s up to CIO’s to help construct that path.”

Broadbent’s and Kitzis’s perspective is laid out in their new book from Harvard Business School Press, The New CIO Leader: Setting the Agenda and Delivering Results. Kitzis notes that the difference between the two paths, between Chief Technology Mechanics and New CIO Leaders is very simple. “It’s all about leadership. Most CIO’s today are excellent managers, but relatively few have stepped up to become true enterprise leaders.”

“Leadership is about change, doing new and different things. Management is about executing well on the things you’re already doing. And if ever there was a time for IS organizations and CIO’s to think about doing new and different things, it’s now.”

Broadbent and Kitzis say that CIO’s need to become enterprise leaders both on the demand-side and supply-side of IT. Broadbent explains, “There are really two aspects of leading when you’re a CIO. First you have to lead with your business colleagues to determine what are the appropriate uses and applications of technology in the enterprise. It’s what we call the demand-side of IT. The supply-side involves leading the IS group to deliver on the expectations of the business.”

Broadbent goes on to note that leadership in both of these areas is crucial for enterprise success and crucial for the career prospects of any current CIO. “Enterprises desperately need this leadership from CIO’s now. And they will find it, if not from their current CIO then from whomever they hire as a replacement.”

What are the changes in approach and priorities that CIO’s need to become new CIO leaders? In their book Broadbent and Kitzis introduce ten critical points of focus that will distinguish new CIO leaders. They note that these ten are not the only things a CIO must pay attention to, they are the ten that differentiate CIOs who will be enterprise leaders from those who won’t.

The first is their injunction to, “ Lead, don’t just manage.” According to Broadbent and Kitzis this is the foundation the rest of the changes a CIO must make are built on. On the demand-side of CIO leadership there are five points of focus:

• Understand the fundamentals of your environment.
• Create a vision for how IT will build your organization’s success.
• Collaborate with enterprise executives to form expectations for an IT-enabled enterprise.
• Create clear and appropriate IT governance.
• Connect IT strategies and actions to business outcomes.

On the supply-side of the equation, Broadbent and Kitzis lay out four additional areas of focus for CIO’s:

• Build a lean and focused IS organization with priority on adding value not adding work.
• Build and nurture a high performing IS management team.
• Manage the new enterprise and IT Risks.
• Communicate IS performance in business-relevant language.

Kitzis notes that the CIO’s priorities among these top ten will vary by their current situation. “Enterprises that are rapidly growing want their CIO’s to focus on having a compelling vision for how IT can help continue to grow and succeed. Enterprises that are struggling need CIOs to focus on building a better and leaner IS team.”

Broadbent and Kitzis are very hopeful that CIO’s will rise to the challenge of enterprise leadership. Broadbent states, “CIO’s must be prepared to take action on each of these ten items – these are the new priorities dictated by today’s business world. We are seeing among the hundreds we work with that some are stepping-up already.