Money makers, not money pits: Five ways the role of CIO is changing for the better

Tech chiefs are happier and more ambitious -- and spending less time managing tech.
Written by Mark Samuels, Contributor
Business discussion meeting

The CIO role is now more about collaboration than control.

Image: iStock

There has never been a better time to be a CIO -- and the opportunities for smart IT executives are only likely to increase, according to research.

The 2016 CIO Survey from recruitment consultant Harvey Nash and advisory firm KPMG shows successful IT leaders as embracing innovation, and taking key positions on the board.

The survey of more than 3,000 executives across 82 countries reveals that top CIOs are happy, engaged, and prepared to deal with the combined challenges of an IT skills crisis and ongoing digital transformation.

So what best practice lessons for IT leaders does the research contain?

1. Successful CIOs are more creative

The traditional IT leader is dead. The survey shows long-standing CIO priorities have seen the biggest drop in importance during the past four years. Increasing operational efficiencies, for example, has dropped 16 per cent, and delivering stable IT performance has dropped 27 per cent.

"The role of the CIO is changing and executives are spending far less time managing fortress IT," says Lisa Heneghan, global head of KPMG's CIO advisory practice, who explains that the role is now more about collaboration than control. Four in ten CIOs now spend at least one day a week outside IT.

"Technology management is no longer just about efficiency and stability," says Heneghan. "CIOs must articulate value from the inception of a project. They have to deliver results to keep the business happy. If they don't deliver great results, the rest of the business will vote with its feet and circumnavigate the CIO."

Such is the rise of decentralised purchasing that ten per cent of CIOs report that more than half of technology spend is controlled outside IT. "If technology chiefs aren't innovative, they will be circumnavigated," says Heneghan.

2. Successful CIOs take strategic roles in the business

The move from operational to innovative technology is reflected at the highest levels of the business. The report shows CEOs are focused on IT projects that can make money (63 per cent), rather than those that save money (37 per cent).

This value-driven approach to technology creates opportunities for IT leaders. Ten years ago, many experts questioned the long-term need for a CIO. Today, the position of IT at the top table is assured. More CIOs report directly to the CEO (34 per cent) than at any time in the past decade, rising 10 per cent year-on-year.

Jonathan Mitchell, non-executive director at Harvey Nash and former CIO at Rolls Royce, says IT leaders are now seen as agents of strategic change. "There's an element of proactivity that we haven't seen before. CEOs are going to the CIO and asking what he or she can do to help the business," he says.

"High profile game changers, like Uber, have shown how technology can change an entire industry. CEOs are starting to worry that their business will be disrupted next. They want CIOs to help shape their business models, not just implement systems."

3. Successful CIOs are happy and ambitious

CIOs with a direct report to the CEO are also the happiest (87 per cent of these executives report job fulfilment). This new strategic role for technology means IT leaders are much more confident about their leadership ambitions.

"CIOs are in a very different place to five years ago," says Heneghan. "It's no longer a case that IT leaders attend the board meeting to be beaten up. Technology is considered key to business growth, rather than simply a cost."

Such is the level of confidence that more than half (55 per cent) of IT leaders believe their career will be outside IT within the next five years. Heneghan says some CIOs could even assume CEO positions.

"IT leaders have more opportunities than ever before," she says. "There's no reason why strategic CIOs shouldn't be able to reach the heights of chief operating officer or CEO. That move might be rare now but it could become more prevalent as IT leaders demonstrate how technology enables business growth."

4. Successful CIOs deal with a significant skills crisis

However, being an IT leader doesn't come without challenges. Almost two-thirds (65 per cent) of CIOs say they believe the skills gap will prevent their organisation from keeping up with the pace of change, a 10 per cent increase in just 12 months. Eighty-nine per cent are concerned by talent retention.

Data analytics is the most in-demand skill for the second year running, at 39 per cent. The biggest jump in skill demand year-over-year is digital, which is up 21 per cent, followed by security, up 17 per cent. Mitchell reflects on these trends and says big data is now a consistent challenge for CIOs.

"The consumerisation of IT means internal and external customers are using devices and apps to interact with businesses in many different ways. Organisations are looking to CIOs to help make sense of the huge amount of information being created," he says.

"CIOs running projects are always striving to get better people with specialist skills. But the big gaps in key areas, like data and security, are tough to fill and it will take time for new, trained specialists to bubble up to the surface."

5. Successful CIOs embrace the rise of the CDO

An increasing number of companies have employed chief digital and data officers during the past few years. The rise of the CDO is often presented as a threat to the CIO. Yet the survey suggests IT leaders need to be open to change.

The research shows firms who once attempted to use other executives to deal with digital are now turning back to the CIO. While one in five organisations employ a CDO, the rate of growth has slowed considerably year-on-year (7 per cent compared to 17 per cent).

Mitchell says many organisations struggled with the pace of digital transformation. "At first, CMOs took control. Then organisations looked to appoint CDOs. Now firms are shifting towards a collaborative executive approach," he says.

"Businesses understand that the more people who are on the pitch, the better the outcome. There's an expectation that CIOs will get involved because IT is ubiquitous. Technology is moving into the mainstream and the one thing we can be sure of is that CIOs face even more interesting challenges in the years ahead."

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