Chapter 4

1. Chapter 4 The Role of the CIO

2. CIO • Title came about in the 1980 • Influences • Executive attitudes • Applications portfolio • Dominant suppliers

3. History • Mainframe era • Primarily operational manager • Distributed era • Need for more specialized knowledge workers • However – over-commitment by IT led to declining reliability • Outsourcing emerged

4. History continued • Four major roles of CIO • Organizational designer • Strategic partner • Technology architect • Informed buyer • Web-based (pervasive) era • Current era – more external interfaces with suppliers and customers

5. Skills • Visionary leader • Relationship manager • Marketer • Open systems-oriented • 20 years in management jobs • French, German, Japanese • Master’s, Harvard Business

6. Turnover • Nearly 2/3s of organizations have had a CIO turnover in the last 2 years • Under extraordinary pressure to perform, and to perform quickly

7. Concerns of CIO (top 8) • 94% enhancing customer satisfaction • 92% security • 89% technology evaluation • 87% budgeting • 83% staffing • 66% ROI analysis (return on investment) • 64% building new applications • 45% outsourcing hosting

8. Education & Career Plan background • 64% come from IT based background & education • 36% from non IT backgrounds & education • 64% come from IT careers • 14% come from Sales & marketing careers • 22% come from operations careers

9. CEO attributes • General management and/or marketing • Change-oriented leadership • Attended IT “awareness” seminars • Experience IT project success • Perceives IT as critical to business • Positions IT as agent of business transformation

10. CIO attributes • Analyst background and orientation • Promotes IT as agent of business transformation • Contributes beyond IT function • Accurate perception of CEO views on business & IT • Integrates IT with business planning • Profile stresses consultative leadership & creativity

11. Asset or Liability • Are we getting value for the money • How important is IT • How do we plan for IT • Is the IS function doing a god job • What is the IT strategy • What is the CEO’s vision for the role of IT • What do we expect of the CIO

12. Strategic Alignment • The primary responsibility for IT management does not have to be performed by the CIO personally – oversight • CIO should manage use of technology and not the technology itself

13. Structure • Reporting structure • 55% of CIOs report to CFO • 21% of CIOs report to CEO • 11% of CIOs report to COO • 13% of CIOs report to other managers • Internal boards • 49% sit on the board • 51% do not sit on the board

14. CEO and IT • CEO’s role is to believe in the importance of IT to the business • Creating context – CEO must create a context of change in the organization that supports the need for successful exploitation of technology • Setting priorities – CEO needs to establish a core group of business priorities that drive the need for continuous enhancement of the technology infrastruction

15. CEO and IT continued • Signaling continuously and positively – the CEO’s belief in IT must be a public matter – need to send this information to the organization • Spending quality time – “Believer” CEOs spend time focusing on IT issues in a proactive manner – well read in IT issues • Relating with the CIO – have a two-way relationship with CEO and CIO

16. Additional behaviors for CEO • Scanning & understanding new technologies • Working on a vision of the future • Sponsoring internal & external architectures • Embedding information management processes • Challenging Its supply side

17. Effective CIO attributes • Delegation of operational tasks • Seize expenditure authority • Avoid adversarial positions • Initiate contacts outside the information technology unit • Use language carefully

18. Effective CIO characteristics • Honesty, integrity, sincerity, openness • Business perspective, motivation, language • Communicator, educator, motivator, leader, politician, relationship builder • Continuously informed on developments in IT, able to interpret their significance to the business • Change-oriented team player, catalyst

19. Requirements of CIO position • Leadership • Expertise in aligning & leveraging technology for the advantage of the enterprise • Business savvy • Relationship skills • Management skills • Communication skills

20. Requirements continued • Ability to create and manage change • knowledge of, and experience in, a specific industry • International or global experience • Ability to hire, develop, and retain high quality IT professionals

21. Some nontechnical skills • Financial skills • Human resource skills • Relationship management skills • Legal skills • Governance skills • Marketing skills • Negotiating skills • Leadership skills

22. Leadership vs Management • 10 basic roles for a Manager • Information processing roles • Disseminator • Monitor • Spokesperson • Decision-making roles • Entrepreneur • Disturbance handler • Resource allocator

23. Decision-making continued • Negotiator • Interpersonal roles • Liaison • Figurehead • leader

24. Leadership characteristics • Broad business & organizational knowledge • Broad set of relationships in the firm & industry • Excellent reputation and strong track record in a broad set of activities • Keen mind and strong interpersonal skills • High integrity & personal values • High level of motivation (energy & drive)

25. “Laws” of leadership • A leader has willing followers • Leadership is a field of interaction-relationship between leaders and followers • Leadership occurs as an event • Leaders use influence beyond formal authority • Leaders operate outside the boundaries of organizationally defined procedures

26. “Laws” continued • Leadership involves risks and uncertainty • Not everyone will follow a leader’s initiative • Consciousness (information processing capacity) creates leadership • Leadership is a self-referral process

27. More on leadership • Leadership is concerned with direction, goal setting, support, and encouragement • Focus is for “getting things done”, NOT with “doing things”

28. Leaders & Managers comparison • Leaders define “WHAT” • Vision – sensible and appealing picture of the future • Strategies – a logic for how the vision can be achieved • Managers define “HOW” • Plans – specific steps & timetables to implement the strategies • Budgets – plans converted into financial projections and goals

29. Responsibilities • Danger is allocating too much responsibility to line managers • Have some loss of overall strategy • Technical knowledge is still needed by CIO

30. Management apportionment • Extent of the organization’s need for networking resources to exchange information among business units or external organizations • The firm-specific requirements to share date elements among business units or with external firms

31. Apportionment continued • The extent wo which applying common application systems across the firms is desirable • The requirements for specialized human resources related to IT

32. 5 Critical Management processes • Setting strategic direction • Establishing infrastructure systems • Scanning technology • Transferring technology • Developing business systems

33. CIO Tips • Get a seat at the table • Regular one-to-one communications with the CEO • Create a partnership with peers • Study the corporate culture • Understand the business model • Define current commitments • Establish credibility first through small things

34. Tips continued • Build a personal board of directors • Listen and talk • Be accessible and responsive • Set realistic goals • Take inventory (people, appl, technology) • Assess your people • Understand the value & threat of outsourcing