The pressure on businesses in the financial services industry continues to be intense – the need to re-establish profitability post the 2008 crisis, to adjust to new cultural and regulatory demands, and to absorb new technology paradigms.
CIOs need to demonstrate they can play a leading role in these exciting, but challenging, times. They also need to recall Arnold Glasgow's observation: "the trouble with the future is that it usually arrives before we are ready for it".
The first thing the CIO needs is a framework within which to think about the plethora of opportunities and threats that comprise his or her in-tray.
These range from the strategic (how will cloud computing change IT provision for companies?) to the more tactical (can agile methods significantly reduce project delivery risk?).
I have found in my career (including three global CIO roles, in addition to working at two leading consultancies and in three start up businesses) that grouping the trends and issues into three categories can help:
- How is the fundamental business model changing (for example the impact of regulation, outsourcing, M&A)
- Where new technology is impacting the company (digitisation, cloud, mobile, cyber-crime, etc.)
- What other advances are doing to evolve normal business practice (social media, consumerisation and device proliferation, for example)
In addition to looking outwards to our customers and stakeholders, I also look inward to the IT function to make sure we are building our own capability and value for money. In my view, that means four major aspects:
- Constant improvement to the cost of delivery (of both operational services and projects)
- Building pace and responsiveness to everything we do: this ranges from agile methods for projects, more automated testing or better business understanding among developers through to more rapid response to service interruptions
- Managing risk, and understanding where we have potential exposure
- Providing opportunities for staff development and growth (even when downsizing the overall IT function) so staff have reasons to stay rather than leave
Given this context and mindset, I see the role of the CIO as having six dimensions, which need to be progressed simultaneously, and in relation to each other:
- Set the strategic context and direction for the IT function and help shape the overall direction of the company as a whole. This needs both clear understanding of the impact of emerging technologies and excellent senior stakeholder relationships so that the impact on their business units can be debated and plans developed in a candid and collaborative manner.
- Effective project prioritisation and reliable project delivery. These are the change initiatives that shape the new landscape for the business. The CIO should feel accountable for this agenda but it also needs very close relationships with business stakeholders. Here it's vital to remember that there is no such thing as an IT project – only business projects with a large technology or information component.
- Deliver operational stability and cost efficiency. This is the fundamental part of the job: the CIO needs to ensure that their credibility when contributing to the business agenda is not compromised by basic failings. This needs to be through empowering great people, not through personal direct management. Most of the CIO's mindspace needs to be on items #1 and 2
- Manage third parties and internal staff. This is a vital part of the role, often under-estimated. Spending time and focus on people is hard to do when there are 101 other calls on your time. But it is fundamental to getting good service from external partners that you help them understand the context of your firm and you find time for them as people. The same stands true for the internal people, who can, with suitable empowerment and encouragement, often do far more than you (or they!) think they can
- Provide formal oversight of governance, cost control and risk management. This varies hugely, depending on the scale and culture of the firm, but is an increasingly visible part of the role, especially to regulators and auditors
- Undertake other tasks as required by circumstance. These can include acquisition planning and execution, post-merger integration, focus on information quality and the like.
Above all, CIOs need to be role models. They need to exemplify a wide range of positive traits, from change leadership, business acumen and technical understanding and execution to delivery, cost control, care for people and the like.
No-one can be all these things all of the time but, as
Michelangelo said almost half a millennium ago, in 1526, "The greater
danger for most of us lies not in
setting our aim too high and falling short, but in setting our aim too low, and
only achieving our mark".
Until June this year, Mike Wright was Head of Technology at Man Group plc, a world-leading alternative investment manager. Previously he headed IT at Fidelity International and at the Willis Group Ltd. In addition to these CIO roles, Mike has seen the financial services industry and IT function from a number of other vantage points. Between 1984 and 1997, he worked as a consultant at both Accenture and McKinsey on various IT and general business assignments; he founded and ran a software products company for four years, and was also a non executive director of another software start up specialising in digital rights management.