cfo.com

Print this article | Return to Article | Return to CFO.com

CFOs Will Determine the Future of the CIO

The CIO's role is changing as fast as technology. Now's the time for CFOs to decide how their CIOs can best help their businesses and to begin looking for the right people to play the part.
Martha Heller, CFO.com | US
February 28, 2012

Has any executive position gone under the microscope as often as the CIO's?  Do we read articles on the future of the CFO or COO or the head of HR?  Maybe a few, but the CIO's role has been poked and prodded and manhandled since the early 1980s when the position first came into existence.

Perhaps we scrutinize the CIO position so often because of the rapid pace of technology change.  The basic accounting principles CFOs use today were developed in (something like) 15th century Venice, whereas technology platforms and paradigms shift every 18 months or so.  How can we hope to understand the CIO role when the ground shifts so often? Perhaps we speculate about the technology chief's future because compared with every other function the CFO manages, the CIO's is the toughest to pin down and understand. (OK, you finally get software-as-a-service, but what's platform-as-a-service?) 

Of course, the almost obsessive focus on the CIO could come from the fact that IT is so expensive. You approve a $50 million IT budget and then wait . . . and wait . . . and wait for the return on that investment.  And just what kind of expenditure is cloud, exactly? Part capex (implementing the enduring capability), part opex (paying for the service on a recurring basis), part mystery (and where exactly is my data now?).

But whatever the reason, we love to dig out the crystal ball when it comes to the CIO.  And since building rather than buying brings some serious benefits when it comes to finding future leaders, it behooves CFOs to think about what kind of CIO their company will need to employ down the road.  Better to identify the right kind of leader and groom him or her than to do a rip and replace at the 11th hour.

Chief Improvement Officer
With their program management and change leadership responsibilities, CIOs are ripe for the role of enterprise continuous improvement champion. As more IT functions are outsourced, and business leaders get more comfortable reaching to the cloud for their technology solutions, the CIO will be released from overseeing IT operations and free to make business processes across the company faster, better, and cheaper.  In a number of companies, CIOs are raising their hand to add continuous improvement to their plate. If you don't have an enterprise continuous improvement champion, you really should. And you should consider your CIO for the job.

Chief Intelligence Officer 
In this version of the CIO role, the "I" stands for the transformation of business information into actionable business intelligence.  Wayne Shurts, CIO of SUPERVALU, a $38 billion grocery company, recently developed a solution for improving sales and "freshness" in his stores' produce departments.  He supplied sales data to store managers so that they could allocate shelf space accordingly.  I asked him what technology he had used: RFID? Smartphones? "Sticky tape," he said.

Many CIOs have evolved beyond the "I have a technology hammer, so everything is a technology nail" mind set and now see their role as serving up information to solve business problems. Sometimes the right business-intelligence solution has no technology component at all.

Chief Support Officer
In some companies, where business units are prone to making their own technology investments and doing end runs around the CIO, or where technology, despite advances in cloud and mobility, will continue to be a keep-the-lights-on activity, the CIO role will be reduced to managing a smorgasbord of software providers and making sure all of their products are secure and integrated and cost as little as possible. More than likely, this role is not an "IT" position at all, but belongs to an enterprise vendor management organization.

Chief Innovation Officer
CIOs have been driving productivity for decades. They got on the map, way back when, by making the business more efficient by automating some basic manual processes. Then they began delivering communication systems, like e-mail, which made everyone more productive. With ERP, CIOs moved into the arena of business process change (and began devouring large chunks of enterprise revenue). Along the way, they also made good use of outsourcing for increased productivity and cost savings. 

For each major evolution in the IT arena, CIOs have had to pick up different skills: technology, project management, change leadership, business process knowledge, and managed-services management. So, what now? What's the next frontier for technology-driven productivity? It is in business model innovation.  Right now, insurance-company CIOs are developing pedometer apps for their customers; retail CIOs are letting their customers design their own jeans while they wait in line at the supermarket. CIOs (at least those with the smarts and the drive) are doing more than changing business processes: they're changing the business.

Which CIO will be right for your company in the next five years?  Do you have the talent on board that you can groom for one of the roles we've mentioned?  As I watch as my little daughters put on make-up and try on high heels, I realize that the years go by fast.   Will you be ready?


Martha Heller is president of Heller Search Associatesa CIO and senior IT executive recruiting firm, and a contributing editor to CIO magazine. Follow Martha on twitter: @marthaheller. 




CFO Publishing Corporation 2009. All rights reserved.