Ultimately, Forrester's Symons suggests, CFO oversight should result in greater IT accountability. "IT has been run as this opaque black box for years, and it shouldn't be," he says. "CFOs should realize that IT can be held to the same standards as any other organization in the business."
David McCann is senior editor for technology at CFO.
Who's the Boss?
New thinking on a perpetual conundrum
IT often reports to the CFO, but should it? Conventional wisdom holds that the CIO should report to the CEO at companies where IT is deemed "strategic," or the company regards itself as an "IT-intensive" business.
But new research by professors at Temple University, Stevens Institute of Technology, and Singapore Management University comes to a different conclusion. The reporting relationship should be governed, they argue, not by how IT is regarded but by how the business defines itself. Companies that emphasize product differentiation are well served by a CEO-CIO reporting relationship, while cost leaders are better served by a CFO-CIO relationship, even if IT is an essential component of maintaining a low-cost edge.
One academic paper won't settle a debate that has raged for three decades, but it might remind executives that the quest for IT-business "alignment" should be determined by the company's core strategy, not the perceived value of, or politics surrounding, its IT department.
To former CFO and CIO Susan Cramm, however, it doesn't matter who the CIO reports to, as long as it is someone who cares. "It should be someone who has an emotional connection with technology — whether the person is mad, happy, excited, depressed, or whatever," she says. "That connection can be channeled into some kind of leadership conversation or partnership with the CIO." — D.M.
How to Hire a CIO
Whether the CIO reports to you or works with you, if you play a role in hiring here's a short list of questions to ask, supplied by CIO recruiter Martha Heller.
Problem: The IT organization is not aligned with the business mission.
Question: "How have you changed the culture of your current IT organization?" Look for an emphasis on client focus, business focus, and accountability.
Problem: Users are dissatisfied with the company's IT services.
Question: "How would your current users rate your IT organization? How do you know?" A good answer will cite a rigorous, methodical customer-satisfaction survey process.
Problem: The IT department is overwhelmed with projects at the expense of building relationships.
Question: "What are your most important business relationships and how do you maintain them?" If the answer is "my vendors," that's a bad sign.
Problem: IT champions the latest technologies without addressing ROI.
Question: "What is the most exciting technology advancement you've been responsible for?" A good answer is not IT-focused ("blade computing") but business-focused ("increased market share in a key demographic").
Problem: A love of arcane terminology and acronyms.
Question: "What do I need to know about services-oriented architecture?" Can the candidate discuss a complicated subject in straightforward business language? — D.M.
Reader Comments» Post a comment