From CIO to CEO: Why it's time to give up on the impossible dream
As the digital transformation continues apace, the central role of IT in modern business practices will only increase - so will we see more CIOs assuming the mantle of CEO?
Research would suggest not. While CIOs often become CEOs at technology firms, Chris Chandler, head of the CIO practice at La Fosse Associates, says there are very few examples of CIOs becoming CEOs at traditional, blue chip organisations.
An analysis of FTSE 350 CEOs in August 2013 found only one was a former CIO, Philip Clarke at Tesco. Clarke's promotion to the top job in 2011 was hailed as a breakthrough moment for IT directors: but in July last year, Clarke was replaced as CEO following the retailer's poor performance.
IT leaders are not just struggling to snare the CEO position. In many cases, Chandler says CIOs do not hold a place on the board. In such circumstances, it is hard to see how an IT leader could make a smooth transition from service manager to business leader.
Former CIO turned digital advisor Ian Cohen also says IT leaders still have a long way to go in terms of their readiness for running big businesses. "We'd like to think there's a good chance of more CIOs becoming CEOs," he says. "But in reality, it's probably not going to happen very often."
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Like Chandler, Cohen recognises that the promotion of CIO to CEO is more than plausible in a technology firm, where the IT leader's 360-degree view of business operations provides a breeding ground for the kind of executive required to lead a successful business in the sector.
Yet Cohen says traditional businesses are looking for a different type of leader: "CEOs need more than just 'a helicopter view' - they tend to have other skills that are recognised by the broader market and by the shareholders. The very best CEOs define the character of companies and get to that position because of their drive, vision, passion and fire."
Discussions with experts suggest that CEOs are by their nature entrepreneurial. While other executives might focus on success in their area of the organisation, CEOs have to be forward thinking, growth-focused, and innovative. And that focus on all-things-new could present a significant challenge for many technology chiefs.
"By and large, CIOs are not entrepreneurial," says one IT leader, who prefers to remain anonymous. "Most CIOs are analysts - and the first four letters of that word pretty much sum up the skills of many CIOs today."
That definition will make painful reading for some IT leaders, yet research suggests many CIOs are characterised by their inability to see the bigger picture.
Research from Joe Peppard at the European School of Management and Technology in Berlin shows the majority (70 per cent) of CIOs are introverts and have a tendency to get bogged down in detail, which can result in them struggling in a leadership role.
While there is nothing inherently wrong with meticulous attention to detail, the business no longer needs an inward-looking IT director who is great at managing tin and telling the business what software and services to use.
The good news, says Stephen Hand, former CIO and independent expert at Consult360, is that mold-breakers do exist. Such IT leaders have managed is to smash the perception associated to technology leadership.
He says a range of businesses are benefitting from the skills of some incredibly capable technology chiefs. These CIOs focus on how information, not technology, can be used to improve business operations and customer services.
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"Successful firms need great vision," says Hand. "The digital transformation has affected, and will continue to affect, all sectors to such an extent that foresight and entrepreneurialism are the stand out requirements for future CIOs."
Forward-thinking IT leaders, therefore, engage with an ecosystem of peers and partners. These engagements help the business meet its objectives, while also proving that the CIO is much more than a practical and pragmatic executive, and is actually an individual - regardless of job title - who must be part of strategic debates.
One potential staging post in that transition is a move from CIO to the established board-level position of chief operating officer (COO). Unlike the move from CIO to CEO, there are many cases of IT leaders either moving to the COO position or assuming many of the responsibilities of an operating chief.
One example is Mark Foulsham, group COO at insurance specialist esure. Foulsham is currently overseeing an IT transformation plan - which involves operating platforms, computing appliance, virtualisation, and cloud - that he hopes will help future-proof the business.
He has spent ten years running IT at esure, during which time he has fulfilled a number of business roles at the fast-growing organisation. The remit of his group-wide role currently covers IT, procurement, and facilities.
There is, then, a broader change taking place, where engaged IT leaders move beyond the confines of the data centre. Some CIOs are becoming internal CEOs for digital transformation, charged by the organisation with running projects that use new, innovative technology to change and improve the business.
In these circumstances, the business is looking for a CIO who is capable of using IT and information to disrupt the existing operating model. An example here includes National Trust CIO Sarah Flannigan, who is running a new three-year, £40m transformation initiative called the Systems Simplification Programme.
Flannigan presented her ideas for change in a white paper to the organisation's director general, Dame Helen Ghosh. She says SSP, which aims to deliver £90m of business benefits across tills, finance, loyalty, and digital, represents the biggest change programme in the Trust's history.
"Technology is now capable of disrupting the status quo of an organisational model," says Chandler, commenting on the great work of transformative CIOs. "If the CIO starts to think about innovation, then they are making a shift towards entrepreneurialism and will develop the kind of edge that puts them in-line with a CEO's mindset."
So while great IT leaders might not necessarily rise to the heights of CEO, they can help change businesses for the better. And it is these CIOs, suggests Cohen, who have a crucial role to play going forwards. "A CEO with a great CIO at their side is an inherently more powerful leader," he says.
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