Digital transformation has placed CIOs under tremendous pressure. As expectations of IT increase, CIOs must adapt to a business environment where innovation, speed, and solution precision are essential.
Unfortunately, the historical relationship between IT and the business has been fraught with difficulty. With IT failure rates estimated between 30- and 70-percent, CIOs have significant baggage to overcome.
The problem is especially acute when a new CIO takes the reins. For this reason, conventional wisdom describes the importance for CIOs to make a mark during their first several months on a new job. Gartner, McKinsey, recruiters and others all explain why the CIO's initial 100 days are so important.
University professors Tony Gerth and Joe Peppard researched causes of "CIO derailment" by interviewing over "100 CIOs, CDOs, non-IT executives, and board members;" they also surveyed almost 700 CIOs globally. They published results in a paper available as a case study from Harvard Business Review titled, The dynamics of CIO derailment: How CIOs come undone and how to avoid it.
The paper describes five reasons that cause CIOs to fail - they call it "derail." Semantics aside, the point is creating situations where the CIO meets business expectations.
In my experience studying IT failures, success is defined by how well the CIO and IT meet customer and business goals. Regardless of any other measure, if the business perceives IT as achieving its objectives to a sufficient degree, then the CIO is successful by definition.
Here are the causes of CIO derailment presented in the report:
Misunderstanding the transition. CIOs must be clear about why the organization has hired them. Is it to jumpstart innovation, save a failing project, or get a new IT program underway? To succeed in the role, the CIO must understand the goals.
Ambiguity in defining IT success. Many CIOs operate in an environment where business leaders define IT success as delivering projects on-time and within budget. However, such metrics leave out the all-important concepts of outcomes and value.
To achieve success, the CIO must establish rules of engagement, or:
face a conundrum: [being] held accountable for benefits but hav[ing] little authority over what needs to happen in the organization for benefits to be achieved.
Ambiguity in role expectations. Organizations may want the CIO to play different roles. For example, some companies expect the CIO to provide technology services and infrastructure while others recognize the CIO as a full strategic partner. To meet these expectations, the CIO must identify what the organization wants and meet those goals.
Some non-IT business executives:
view the role as encompassing strategy and innovation but still treat the CIO as a service provider only. Failing to see the contradiction, they want their CIO to be a miracle worker and achieve major impact without having to trouble them.
Poor relationship management with peers. As technologists, many CIOs do not place sufficient emphasis on the need to collaborate with business leaders in their organization.
In my own research into the issue of CIO relationships in higher education, we offered this advice:
Although the top decision-maker and other senior executives shape an institution's organizational culture, IT can take a variety of steps to facilitate opening the culture to improvement and innovation. However, IT's historical reputation for being insular and unwelcoming may create negative perceptions that require significant effort to overcome. By establishing processes and workflows for listening to, and engaging, stakeholders, IT can build the relationships needed to support institutional change.
Pushing change at the wrong pace. Although transformation and innovation are synonymous with change, they are among the most difficult challenges facing any organization. Therefore, every CIO must determine the right pace of change for her or his company and situation. However, it is also true that figuring this out is not easy:
Clearly, new CIOs must make an impact, but at what pace? While creating change too slowly can cause derailment, so can implementing change too quickly.
As with all organizational issues, there is no silver bullet for addressing the points raised here. However, the authors suggest:
- Clearly understanding the CEO's vision for IT
- Recognizing the ambiguity of the CIO role
- Delivering on service and solution commitments
- Building a relationship strategy
- Proactively defining IT success
- Managing the pace of change
- Speaking the language of the business
For many CIOs, these issues may seem obvious and hardly worth research or thorough evaluation. However, in my discussions with many CIOs on the CXOTALK platform and in advisory situations, it is precisely these organizational issues that deserve the greatest attention.
Buying technology products and capabilities is easy; developing strategic clarity and the political savvy to execute an innovation agenda requires far greater subtlety and skill.