CIOs approaching a fork in the road

Can a good IT chief be both business change agent and manager of IT operations?

A new study from Forrester Research has highlighted the evolution of the role of chief information officer and sparked debate about the qualities that good IT leaders must possess. The research points to a “fork in the road” for IT chiefs in 2008 as they must choose whether to become a business change agent, thus gaining greater influence with the board, or remain as general manager of IT operations.

Only the top 15 to 20 per cent of IT leaders will ultimately take the risk and aim to integrate more with the business by developing peer relationships at a business level, and achieving greater insight into product and service innovation and how it can affect change, said Forrester vice president Alex Cullen.

The remainder are likely to continue ensuring IT runs well within the organisation and meets business expectations, although this type of IT chief is still vital to firms as IT expectations grow, Cullen added.

Following the former path, however, may lead to greater rewards as these change agent IT leaders are promoted as internal board members and ultimately could reach the position of chief executive, said Cullen.

“The path to chief executive used to be via CFO but this changed many years ago,” Cullen added. “Now, it is based on success in running a line of business and knowledge of how the business works, and CIOs have key [strengths in these areas].”

However, the job of head of IT is more complex than that, according to other experts. Carl Bate, UK chief technology officer at consultancy Capgemini, argued that business change agents must first gain experience of “running IT as a reliable business”, although they must also be prepared to innovate for business change.

“We’re using a planning tool with some of our CIOs to help understand and plan this mixed portfolio of cost and value, and business and technology,” Bate explained. “I suppose in the end perhaps there isn’t a single choice of direction for all CIOs, and managing this ambiguity is often where the value is to be delivered.”

Tim Murfet, head of technology consulting at Accenture, agreed that rather than bifurcating into two different roles, the IT leader should have both qualities of general manager and change agent.

Murfet added that increasingly IT chiefs come from the business rather than the IT side, as this role allows them “to get a good overall view of the business and the way IT enables the business”.

Andy Mulholland, global chief technology officer of Capgemini, argued that there is a “huge opportunity” for career development for IT professionals who rise to the challenge and take a lead on business change and innovation. “If you look at what the CIO is doing in the organisation, it is keeping a cohesive use of everything ­ the role was originally brought in to get cohesion back into the business,” he argued. “The key [to success] is how they can change their role to one of front-office value creation.”

However, Seamus Reilly, head of information security at consultancy Ernst & Young, argued that the most successful IT chiefs are able to recognise what the organisation wants from them ­ be it a general manager of IT or a dynamic change agent ­ and deliver the skills accordingly. “A business might want stability one year and to get into different markets the next,” he said. “Organisations want different CIOs at different times, and the smart CIOs recognise this and can sell themselves.”