Why CEOs shouldn’t ‘outsource’ IT decisions to CIOs

If you’re not an early adopter, maybe you’re a fast follower. And if you’re neither, Scott Klososky believes it’s time to hurry up.

The founder of Webcasts.com, Paragraph Inc. and Alkami Technology, Klososky has just published a book, The Velocity Manifesto: How to Harness Technology, Vision and Culture to Future Proof Your Organization. Though it sounds like the kind of tome explicitly written for chief information officers, Klososky is actually aiming higher – at the CEOs who often fail to support technology adoption until it’s too late to prevent falling behind the rest of the industry. That said, he says senior IT executives should resonate with his key messages.

“The CIOs will probably buy into the concept of some of the book. CIOs are in an interesting situation,” he says. “They have to interface with the CFO or CEO, guys who are typically 50-60 years old, and who don’t understand technology very well. If those people have no idea how tech can be used as a tool, they’re not going to be helpful at all in making good decisions.”

In fact, Klososky suggests that some CEOs are so bad at thinking for themselves in relation to technology decisions that they let people like CIOs make the call on adopting technologies like cloud computing. This is a mistake, he says.

“I get very frustrated because this is a perfect example of where a CEO needs to understand what technology can do,” he says. “Instead you see them outsourcing (the decision) to IT people who have a vested interest in not moving to the cloud. If you’re a CEO, you should be asking ‘What’s our cloud transition strategy?’ ‘Are we going private (cloud) or public?’ Most CEOs would never know to ask for that. They can’t even define public or private cloud. Instead they look to their CIO or vice-president of technology and ask them. Those people will say, ‘We’re really worried about security.’ Which in a lot of cases can be translated into, ‘I don’t want to cut staff.’”

Klososky, who still serves as chairman of online banking software provider Alkami, realizes that heedlessly investing in every emerging technology trend isn’t feasible for most organization. The Velocity Manifesto, he insists, is not an argument for buying into the hype.

“I’m not naive. It isn’t like I don’t understand the danger if you’re on the bleeding edge,” he says. “But my point is, either you’re teaching your competitors what to do or they’re teaching you. In this day in age when the economy is moving faster, when innovation is moving faster, there is a gap that I see. In that gap you win market share.”

Of course, most CEOs are probably worried about taking the kind of risks around IT that lead to embarrassing failures, getting them into trouble with customers or shareholders. Klososky says he is well aware of the IT industry’s many cautionary tales, but that shouldn’t stop CEOs from learning some of the skills they need to assess potential opportunities available to them through IT.  

“I think you see what you want to see. If you see a story about how Nike tried to put in a new inventory system right before the holidays and it didn’t work for them, and if you want to see that technology can be dangerous, you will hang on to that story,” he says. “If you blow up an implementation, that is not the fault of the tool. It doesn’t mean the tool is bad, it means you blew up the implementation.

While CIOs may feel they’re hitting their heads against a brick wall when they talk to today’s senior managers, however, Klososky says future leaders may prove more sophisticated around IT, and better able to judge what will work and what won’t.  

“I think it’s more generational. When people who get into power when they’re 30 years old and down, these are people who understand technology, who know it in their soul, who have no fear of learning about it and applying it as a tool,” he says. “That is simply not the case of a lot of 50, 60 year olds. They don’t wield it as a weapon.”

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