IT Employment

Gartner CEO survey: Something's wrong with this picture

The latest Gartner CEO survey reveals that CEOs don't really consider CIOs a strategic partner.

Gartner's latest CEO survey seems to reveal nothing out of the ordinary. That is, 85 percent of CEOs surveyed said they believe their enterprises will be impacted by an economic downturn in 2012. However, by a ratio of more than two to one, the CEOs said they'll be increasing their tech investments in 2012, despite the less-than-rosy outlook.

But that's not the weird part. CEOs know that if they want their companies to grow at all, they're going to have to invest in newer technologies like mobile and cloud. And it looks like they depend on their CIOs to make these things happen in a structured and strategic way.

Now for the weird: When the CEOs were asked who leads innovation in their firms, about one-third of the respondents said themselves, followed by the CFOs and various other senior management leaders. But guess who was rarely mentioned? The CIO.

So what's happening here? Is the disconnect the fault of CIOs who are not developing a stronger strategic relationship with CEOs? Or is there a misperception on the part of CEOs about their CIOs?

My guess is that it's a little of both. But also, I think that more CEOs are clued into tech innovations that are happening because they are so mainstream. In other words, good CEOs are going to be knowledgeable about emerging tech that can move their businesses forward. You can't click on a mainstream publication without reading about mobile tech and the cloud and security.

So the CEOs work with the CFOs to determine the costs and cost savings, then they pass the task on to the CIO to just make it happen.

Have you all seen this in your companies?

About

Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.

21 comments
Deadly Ernest
Deadly Ernest

and then tell the CIO to make it happen despite the advice from the CIO that it needs more money for new gear or it violates existing contracts or just won't work with their gear. In one company I saw them throw away a few million trying to make a piece of hardware the CEO was sure would be great for the company, yet it did NOT work with the existing system and violated the security requirements of the contract with one of our major clients. No decision should be made until well after they've talked to the CIO and given the CIO a chance to research it.

glebovitz
glebovitz

I think the bigger questions are where are the businesses going and who is driving the changes. Technology used to be the cost of doing business. Paper systems gave way to batch processing which was replaced by on line services. The big change of the 1990s was making corporate data available to more employees, and being able to close the books at the end of each day. Then came the dashboard and a bit of decision support. Now in many cases, technology is the product. AIG found this out the hard way when progressive and GEICO started eating their lunch in the consumer insurance business. Social networking and on line services become a key advantage if not a new product line. Business and product managers drive the opportunities and the CIOs are there to either ensure that the technologies fit together. Regulations, privacy, security, and metrics are all important parts of the puzzle. CEOs of public companies have to worry about market perception. It doesn't auger well to say that your CIO is driving your business. None of what you present is surprising. I don't now why you find it so. The bigger questions to me are the CIOs roles in delivery on product vision. If they are supplying the infrastructure from which products can easily grow, then their vision of easily meeting the new markets is important. The big focus now is on data mine "big data". This is clearly an area for value add that belongs in It. What about new customer web services and mobile applications. Is that IT, or a separate business group? None of this is address in your survey, but I think those are the key questions.

jim-griffin
jim-griffin

There are many reasons the CIO role is struggling. In fact it is much bigger than the CIO role, it is also the connection between what is viewed as the "rest of the business" and then there is IT. If we rely on the CIO to "fix" all the problems it is like thinking that if we elected the right president he would fix all of our social and economical messes. It takes more than the CIO or the relationship with the CEO. All of the dysfunctionality that has existed between technology and the rest of the business is beginning to become a critical situation that must be resolved. Those that figure it out will have less trouble succeeding in the near future, and those that don't will continue to resolve thier messes with "process" and new staff, but it will be painful and unsuccessful because the issue is a people problem, not a technology or process problem. Almost 75% of the CEO's view successful technology delivery as "critical" to the success of their organizations. Yet only 11% of the CEO's have confidence in their technology organizations. Take also into account that 68% of technology workers are considered to be disengaged at some level from their work. Most view their paychecks as a trade for their time. In an industry that is constantly changing and facing enormous challenges to being a legitimate strategic partner, do you want disengaged employees? I would think not. I have done a substantial amount of research on this and there is a lot of talk about the symptoms, but little talke about the manifold of root issues that are creating the symptoms.

gevander
gevander

Maybe you need to read some blogs other than your own. The CEO doesn't know anything about "cloud" or "mobile solutions" except that they are current tech buzzwords. So he must use them. The CFO doesn't CARE about the buzzwords OR about the technical aspects of what the CEO is talking about. He cares about the COST. The CIO knows about the tech behind the buzzzwords and DOESN'T CARE about the cost. He only wants to implement the best solution for his company regardless of the cost. And that is why the CFOs have worked so hard to freeze the CIOs out of the decision process. TechRepublic or another tech blog published another story recently about this same thing - how CFOs are taking precedent over CIOs in deciding WHEN and HOW money gets spent on tech. Instead of being a member of the board, involved in making a decision, the CIO has become a "Senior VP" in charge of implementing the CFO's IT plan.

cykes
cykes

I see this often, partly because of IT consumerization and the air time of business models such as the cloud in the mainstream press. C level execs for example see the use of tablets as something they pushed and cloud services as their recommendation. However in ICT we can't simply go to the CEO or CFO and say "lets do this." We need to provide the business case in terms of dollars and sense while listing the business risks by doing or not doing. C level execs simply say, "this tech is great lets do this," and they can run an idea straight to implementation. In some cases it even turns out to cost more and/or fails completely due to the lack of analysis. Virtualization is one such tech that many organizations slowly adopted by identifying the cost benefits. This was usually an ICT project originated by ICT as a strategic project to enable business continuity, reduce datacenter foot print and improve hardware efficiencies to name a few advantages. Despite obvious benefits, for many ICT departments this was an uphill battle. Perhaps this is a popularity issue. With the release of the ipad CEOs wanted ipads and brought them into the organization. No one denies the benefits of tablets and their functionality but unless a large part of your organization is mobile, use handhelds or mobile services many ICT departments will simply not spend the time to justify tech that has little benefit to the organization outside of the executive branch. After all we're not here to kiss ass, we're here to provide a competitive advantage and benefit to the organization. To summarize, this is a common perception by CEOs. ICT departments however also use it to their advantage especially when the tech being pushed has been identified as having tangible benefits to the operations of the business. I'm certain that many ITIL aware ICT departments were only too happy when the CEO said they should use Servicedesk technology. Some were already using such solutions without the knowledge or understanding of the CEO but having "approval" simplifies the quest for greater governance in organizations.

NightLife6
NightLife6

A systemic problem that was recognized by the Fed-CIO council many ??? many years ago. The demise of the CIO was set in motion from the start by the shortcomings within the Clinger-Cohen Act ant the failure of our Academic institutions to fully integrate the position into their MBA studies. Most Grad students are clueless as to where the CIO fits into an organizational structure and what role they will have, other than being the senior techie. Over the years, this has led to the CIO not being considered a serious player at the executive table or even have a seat at the table. This is due to the perception that they have no knowledge about the Business or its strategic needs. Business processes are owned by the Business unit, not the CIO. However. The CIO is responsible and accountable for automating those processes. Most Business units/cost centers are structured in the old manner of position level equating to scope of responsibility (read as number of subordinates) and serious automation is seen as a threat that will lower ones position within the Org/structure. This has resulted in the current fiasco where no one really knows where the CIO really fits in and just what level of accountability, responsibility, or authority for strategic business processesthey should have, if any.

ikchennai
ikchennai

CIO is only providing strategic for IT operation, not all operations in the organization.

WiWildcat
WiWildcat

It has been this way for ever, and that's too bad. Companies these days rely on their technology more and more, and having bad or broken systems, or systems that are not adequate can KILL a companies productivity; yet, it's the CIO who gets the blame even though they rarely get the budget. Sometimes it's the CIO not selling the need, but oft-times it's because Sales is the "darling" as they literally bring in the money. Yet, if not for the IT, they wouldn't be able to find a customer in a convention. One must have a thick hide and be into self-flagellation to be in IT management, and it has always been that way. If some day we all pulled the plugs on the servers, you'd be able to watch while the rest of the executives run around like chickens with their heads cut off.

Richard.Miranda
Richard.Miranda

My perception of what a CIO should be is the key innovator in a company. The very reason for having a CIO (that usually makes six figures) is to provide strategic direction in information technology. Otherwise IT operations is placed under another executive like the general manager or CFO. Unfortunately in those positions information technology departments are often viewed as cost centers and supportive roles to everyone else rather than innovators.

blarman
blarman

The CEO says to the strategic team - I think we could improve our business by doing X. What do you think? The CIO says "give me a week to give you some technology options." The CFO says "great, then I can do a cost/benefit analysis" The CEO says "Awesome. I'll start working on what I want, then we can reconvene in a week to discuss which way we want to go. After a week... The CIO comes back and says: So we limited things down to three options: A, B, and C. We feel B more closely aligns to the goals as outlined. The CFO comes back and says: We looked at the options and felt that while A had the best price tag initially, B does have a long-term value in productivity gains that could even out this cost. The CEO says: Okay. During my research, I determined that this is the kind of process we need to follow to improve. Which options allow for that? We can dream, can't we?

MyopicOne
MyopicOne

...the CIO cannot be the key innovator because they do not have the power to allocate funds and resources - CEO's and CFO's [i]can[/i] allocate the dollars. It's that simple.

InfoStack
InfoStack

Look at a company, any company from the outside. If it looks analog, it's because the CIO is not selling properly to, or not be used properly by, the rest of the management team. If it looks digital like Apple or Amazon the CIO is doing his job. The top 3 questions the CIO should be asking in Socratic fashion of his fellow management: 1) how can we enhance the customer experience?; 2) how can we empower our employees?; 3) do you know what platforms get us there? Of course the good CIO has all the answers to begin with. Revenue growth, productivity and cost savings will all result from those 3 questions asked every morning and continuously being answered.

Screaming_Chicken
Screaming_Chicken

Reading the OP and comments here... LMAO! "CEOs know that if they want their companies to grow at all, they???re going to have to invest in newer technologies like mobile and cloud." Seriously? Those "technologies" at best may reduce some future expenditures (i.e. moving to the "cloud") and except for a very few niche areas, any new developments in mobile commuting are all but irrelevant. . Technology is just a tool and IT workers are just mechanics. CEO's have no respect for CIO's and technology fan boys for that reason.

Odipides
Odipides

"When the CEOs were asked who leads innovation in their firms, about one-third of the respondents said themselves, followed by the CFOs and various other senior management leaders. But guess who was rarely mentioned? The CIO." If the chief administrator of a hospital announced that he'd be taking part in decisions about brain surgery he'd be laughed out of the room. Why, then, do CEOs feel able to make significant technical decisions based largely on their ability to send an email unaided? I have a situation right now where the CEO has made a number of decisions which, in the not too distant future, will end in disaster. But, he's made up his mind (I use the term loosely) and refuses to listen to any dissent. I can GUARANTEE, were I at liberty to relate the facts of the issues, not ONE technical person on this forum would disagree with my views (which relate to testing and the need to do it before unleashing a financial application on the general public) and most would regard them as "the bleeding obvious"! However, when all the queer stuff hits the fan, as it assuredly will, guess which department is going to carry the can?

Tony Hopkinson
Tony Hopkinson

I'm not. Innovative and technical aren't synonyms. How many CIOs get their jobs for their technical ability compared to their ability to do top table politics? Most of which is to agree wiv da boss! The CIO position might have been created to align technical and business thinking, in how many places has that actually happened? If they got the position through their business thinking then the CEO is probably better at it. If they got it through their technical ability ( I have a bridge for sale if you believe that), then they are the last person a CEO would go to for a strategic business decision.

VU-doo
VU-doo

I think the CEO/CFO interest in "innovation" is driven by the realization that several tsumai-sized technology waves are simultaneously hitting the beach: All Things Cloud, Big Data, and Mobile Computing. These three technology "megatrends" are all potential game-changers and have been getting huge business press, and rightly so. It's unusual to have three such transformative movements going on at the same time, each with the potential to turn existing business models upside down and create massive new opportunities at the same time. Unlike lesser tech trends, these are not incremental shifts that impact mainly IT, these are fundamental changes in the playbook. I believe CEOs/CFOs are scared and excited, and therefore engaged. The CIO has been nudged aside while the guys responsible for P/L determine their strategies. Certainly the CIO will be a prominent partner in all this, but for once the CIO doesn't have to ring the alarm bell, they are already loud and clear.

ryan101
ryan101

I tend to agree with this picture, while the intensity of decision making should be proportional to the investment being made and risk involved, CEO's do have ready and easy access to information and packaged solutions on which to base their decisions on. CIO's are only there to execute and implement what the CEO needs, it does not matter what the CIO or IT department thinks, in fact there is very little time to think too much anyway. Complex challenges and time strapped CEO's may still require their CIO's, but as technology becomes more of a commodity, there will be a lessening need for technologist in main stream business environments.

HypnoToad72
HypnoToad72

I mean, profits don't come from laborers who spend their money, or less of it as wages stagnate or drop or disappear? ...

mwclarke1
mwclarke1

CEO comes to CIO and says "I read in this magazine that we need to be doing this, Make it happen !" If your IT department reports up to your CFO/COO, etc, then there is not business alignment and are in an outdated business and financial operational model that stifles innovation and productivity,. In the past a company made a widget, this was done via labor, It was just an adjunct technology to improve financial reporting, payroll, slowly invoking into more resources but never affecting production directly. Ina short time frame It has evolved into being the production environment, all web e commerce to back end digital processing and in some manufacturing IT drive automation replacing humans. But IT still is seen as a black hole for money, regarded as the black sheep of the family and many of its staff like homeless low life that should be grateful to even have a desk in that very small corner of the closet somewhere. But when a server or network fails and all production comes to a halt, people can not place orders online, the company can not get invoices sent out to customers, process those credit transactions for payment, etc, the IT becomes very important, but need the end then is blade for the problem that had happened, not the penny pinching Idiots that think they are running a company properly by not providing the resources to have a proper reliable and redundant infrastructure that is then required to run 24x7x365 at 99.999999999999999999 percent up time !!!! ARRRRRGGGGGGGGG Only the people in the trenches know how to run the company. Can take all the C Executives out of the picture, and the company would never miss a beat.

Richard.Miranda
Richard.Miranda

As an IT Manager I've never been one to advocate technology for technology's sake. But a good CIO is the head of an IT staff that includes systems analysts (and should likely be one as well) whose purpose isn't just to keep up with the technological "Joneses". They should be, by charter, constantly reviewing business processes for improvement in a number of different ways including, effectiveness, efficiency, and security. In fact, if they're really doing their job right, those changes should come more in a gradual evolution so as to avoid culture shock and make the transitions just part of an overall progressive strategy and business philosophy. Viewing technology as simply a tool rather than an opportunity suggests that the business environment is being reactive rather than proactive. Not a great way to get ahead of the competition.

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