What do CEOs want from their CIOs, and how can CIOs build on the power gains they’ve built up, even as everything around them is changing?
CIO magazine tackled just that subject during a panel session at the CIO Leadership Conference, recently held in Boston. Michael Friedenberg, CEO of CXO Media (publisher of CIO), discussed the importance of CIOs as strategic business leaders and the changing role of the CIO with Rajinder (Raj) Gupta, executive director and adjunct professor Northwestern University’s Kellogg School of Management; Chris Patrick, partner at executive search firm Egon Zehnder International; Robert P. Badavas, president and CEO, of staffing firm TAC Worldwide; and Steve Merry, CIO of the Sara Lee Corp.
They found five main keys to being a top-notch CIO today-and tomorrow.
“CEOs want people who can connect the technology to their strategic intent.” Chris Patrick, partner at executive search firm Egon Zehnder International
One: Be a Strategic Business Leader
Much of the CIO traditional role is now merely table stakes. Technology itself will not set you apart; you need far more business expertise than CIOs of yesteryear did.
CIO, Michael Friedenberg: What has changed about what CEOs expect from the CIO?
Raj Gupta: I have talked to 15 to 20 CEOs directly, and they are looking for someone who can be a trusted business partner. Of course the CIO has to keep the trains running, but CEOs want the CIO to be a senior leader such that, when you are together with the rest of the executive team, it’s hard to tell you are the CIO.
Chris Patrick: CEOs want people who can connect the technology to their strategic intent. I have clients who are investing billions of dollars in IT. They want a person who can show the team the ROI from this investment.
Bob Badavas: At the end of the day, what CIOs are paid to do is take a full seat at the strategic planning table and be an integral part of the strategic decision making-which means they need to know what business they’re in. Get out of the office and find out why people buy your product or service. IT is a strategic weapon. To find out how to use it, the CIO must engage with clients and the front-line distribution or sales organization.
Steve Merry: Technology is a given; we need to get value from that by removing the clutter and making it easy to use. Then we can sit with our business partners and take the business forward, focusing on things that make a difference-growth, innovation and acquisitions.
Two: Speak the Language of the Business
Everyone’s talking about the “strategic CIO,” but is everyone ready? Maybe not. That’s why you need to sharpen your communication skills-and work for a CEO who supports today’s version of the CIO role.
CIO: I don’t know of any CIO or CEO who would disagree with the need for CIOs to drive business value. But not everyone is succeeding in doing that. Do CEOs really mean what they say about their CIOs?
Patrick: CEOs all read the same Harvard Business Review articles. They all want “strategic CIOs.” But often they are not sure what to do with them and how to best leverage the talent and expertise these individuals can bring.
Gupta: While everyone wants this strategic role, both sides are not quite sure if the CIO is ready. The test I pose to CIOs is, Can they talk to the management committee and outside stakeholders in a language that doesn’t label them as a CIO? That’s the test of credibility.
The CEO isn’t quite ready as well. They are so engaged in keeping the business running that they have trouble finding time to give the CIO the opportunity to be a strategic business driver. They must have commitment and belief and not just talk the talk.
CIO: Bob, as our representative CEO, how do you respond to that?
Badavas: CEOs have the company they deserve. If I say get out of the office and don’t give you a travel budget, who are we kidding? I can’t say IT is important if I’m cutting initiatives that could enhance the value of our infrastructure. I can’t pontificate on how you should transform yourself if I’m not willing to make a personal investment. My responsibility to all my direct reports is to have an environment that allows them to blossom to their full extent, and to allow them to make mistakes. I owe them the opportunity to grow and to be part of my succession plan. I have had conversations with them that start “If you want to be a CEO someday…”
“Get out of the office and find out why people buy your product or service. IT is a strategic weapon.” Robert (Bob) P. Badavas, president and CEO, of staffing firm TAC Worldwide
Three: Get Involved in the Business
As the CIO, you get a bird’s-eye view of the business. Make sure you show that knowledge, no matter who you’re reporting to (and give your staff the chance to gain that knowledge as well). And if you can’t shine where you are, go somewhere that you can.
Patrick: If you can demonstrate that you’re different and bring strong business skills, you will be in demand.
Merry: Who has the broadest perspective across the business? The CIO. We’ve seen everything done several times over and can give that perspective back to the executive team. But we must have the [courage] to challenge the people who see themselves as experts in their function area. Speak up or you don’t have the right to be in the room.
CIO: CEOs say they want the CIO to make this broad, strategic contribution as a business partner, yet they continue to have the CIO report to the CFO.
Badavas: The CIO has to report to a C-level person who believes that people should not just be focused on their functional silo. It’s fine if the CIO reports to a CFO who is tracking to be a CEO. But if it’s a functional-oriented CFO, then that flows down hill, meaning the CIO will probably be expected to focus on the IT function only. How can the CIO communicate the value of IT if the CFO has IT sitting in a corner just like the maintenance function of the company?
“Technology is a given; we need to get value from that by removing the clutter and making it easy to use.” Steve Merry, CIO of the Sara Lee Corp.
Patrick: One of the first questions I get from CIOs when I’m conducting a search is “tell me about the reporting structure.” In general, the reporting structure is a good proxy for how strategic the role ultimately will be. It’s not an absolute-I meet some highly effective and strategic CIOs who report to CFOs. But it is a good indicator. More important is how the company is structured. Is it in a way that truly leverages the CIO position? It’s clear that Steve [Merry] plays a strategic role because he’s meeting with the business leaders regardless of who he reports to. It’s not black and white.
Gupta: The reporting relationship is just one indicator. Is the CIO involved in the informal dialogue that happens within senior leadership circles? If you are only involved when presenting the IT plan, then the opportunity is missed. I think CIOs do have the broadest possible perspective of the business. But why doesn’t the rest of the organization understand that? The answer lies in communication; the ability of the CIO, and just as importantly, his IT team, to speak the language of the business.
Merry: It has to extend to the next level down. If my direct reports can’t get out and mingle with the business and speak up and be respected, then I have failed too. So when selecting the next level down, you need to find business-savvy people who can converse with all of the businesses at the level where things actually get done.
Badavas: The layer below the CIO, and the CEO for that matter, is the enabler of how high we can fly in our own positions. If my executives can’t push me up higher, that will impair the growth of my company. We generally don’t spend enough time thinking about and clearly communicating on succession planning. But it’s a key to success. A philosophy I adopted long ago was that to get to the next level you have to behave and think as if you are on that level. If you don’t, you won’t get there. The same goes for your direct reports.
Gupta: Your management team must get the CEO’s agenda. It’s not technology. It’s growth, innovation, risk mitigation, alliances. The CIO and the management team have to figure out how to feed into that agenda.
Four: Be a Skilled Marketer of IT
Other executives and employees won’t know the about all the great things IT is doing-unless you tell them.
Gupta: Many CIOs see marketing as a dirty word.
Merry: We branded our IT group. We gave them a logo and played the marketing guys at their own game. Sell yourself because you have something to sell.
Badavas: Don’t market “stuff.” Market the value-the result-you caused. That will have people sit up and take notice. CEOs would love to cut through the preamble before the answer. Start with the answer and then you’ve got my attention.
Patrick: But be careful what you ask for. If you ask for that seat, you’d better be able to deliver value. If you can only talk about speed and feeds, you’ll find yourself quickly out of there.
Badavas: [CIOs and IT leaders] are much better than they think at talking about using information as a growth driver.
Five: Prepare for the Future
The CIO role will continue to change as more tech-savvy folks enter the workforce and sit on boards. Make sure you’re prepared to collaborate with them and adapt to company’s changing needs.
CIO: Look into your crystal ball: What does the role of the CIO look like 10 years out?
“Since many more people in the organization will understand the strategic use of technology, the person with the CIO title will no longer have a monopoly on that. ” Rajinder (Raj) Gupta, executive director and adjunct professor Northwestern University’s Kellogg School of Management.
Gupta: Boards of directors are going to get younger, and they will have more appreciation of technology. So there will be a better chance for that connection with the CIO to happen naturally. But since many more people in the organization will understand the strategic use of technology, the person with the CIO title will no longer have a monopoly on that. Expectations will be different and higher as both sides get more sophisticated.
Merry: It won’t be like today. We won’t have the typical roles. There will be more collaboration and partnerships with noncompeting companies in the use of technology and sharing of resources. You won’t need a CTO in the organization- HP will do that and you’ll manage the relationship. There will be a much smaller senior IT team working with the business and managing relationships. And there will be a lot of Indians and Chinese in our organizations.
CIO: What advice would you give the audience that they could take away and use to get better prepared to meet the new CEO expectations?
Patrick: Get exposure beyond your function area of expertise, and get international experience-live overseas. I look for that with every person I place. And though it seems basic, work for good companies. People want to hire talented, innovative change drivers.
Merry: Be brave in front of the business and make sure you get the relationships and governance right.
Gupta: Learn the CEO’s agenda and get yourself and your team on that agenda. Make sure the CEO knows you understand that agenda while you also keep the trains running.
Badavas: Make something happen from a business perspective. Influence your peers, articulate future possibilities and just be bold.
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