How the CIO came to be
- 23 January, 2013 22:00
Ever wondered when the first CIOs graced the halls of Australian corporations? Some arrived in the early 1990s with the birth of open systems hardware and the arrival of the first enterprise resource planning (ERP) applications.
"The term CIO came into existence in America in the late 1980s, early 1990s," says Graeme Philipson, an IT industry veteran and analyst. Philipson was previously co-founder of MIS magazine (which merged with CIO in New Zealand), which was acquired in late 1999 by Fairfax and eventually closed by the publisher in early 2012.
"The idea was that it [CIO] was a C-level position, the same as the CFOs or COOs, and was meant to reflect the fact that the CIO or senior IT person should be on the board with the same level of influence and seniority as other C-level executives."
According to Philipson, the new CIO title in the early 1990s didn't really reflect the change of role and was seen to be a "trendy title" to have. And depending on the organisation, the CIO was often at the same level as the IT manager or MIS manager.
In fact, only 10 per cent of the 4000 IT departments listed in MIS magazine's database in mid-1990s used the CIO title, Philipson says.
"IT manager was also used quite a bit; in some large organisations, you would have an IT manager reporting into a more senior person who was often called CIO," says Philipson.
"In practice, the titles were interchangeable -- the guy who might be called a CIO in one company, might be called an IT manager elsewhere. The term CIO did not reflect that they were C-level operatives in many cases."
It seems that in many organisations, nothing has really changed. Even today, many CIOs are still fighting for a seat at the boardroom table as they make the transition from being viewed as a technology boffin to business leader and strategist.
Way back then
Perhaps the best way to examine how the modern CIO role has truly evolved is to take a look at who was responsible for driving IT strategy in the early days of computing, before open systems and the Internet.
During the mainframe era of the late 1960s, '70s and '80s, organisations typically employed electronic data processing (EDP) managers and data processing (DP) managers. In government, the term was often automatic data processing (ADP) manager, says Philipson.
"Way back, the IT leader was called the manager of electronic data processing," says Philipson, adding that in the late '60s, mainframes were "basically super calculators", and were run by the CFO who was doing most of the number crunching.
"The term ADP was the idea that data processing was automated; you have visions of abacuses and adding machines rather than computers. So ADP preceded EDP, so if you wanted to do a timeline you would go ADP, EDP, DP," he says.
"It [ADP] held on in government for a bit longer. I remember in the '80s, some government IT managers still being called ADP managers."
Philipson was selling PCs in the early 1980s and joined Yankee Group as an analyst in 1984 when the concept of end users in an organisation was becoming popular.
"At the beginning of the '80s, no-one had a computer on their desk; by the end of the '80s everyone did, every white collar worker," he says. "And that's not an exaggeration; we went from zero penetration to total penetration in business and government, in knowledge and white collar workers within that decade."
He says that by the early '90s, the term MIS manager was still more common than the relatively new role of CIO.
"The role of MIS was being defined in terms of providing information systems to management. It really did not take into account the concept of the end user," he says.
John Roberts, research vice-president at Gartner's CIO and executive leadership research team, says during the early 1980s organisations recognised "IT people were not just providing calculator systems but really delivering information." This was despite the fact that enterprises were still generally building bespoke applications.
He recalls working in the distribution department of Mobil Oil Australia in 1980 using customised code to build an order taking and truck delivery optimisation system.
"I remember one of our great concerns moving from a system where customers would ring up their individual depot and place an order to an Australia-wide system, was [whether] the 1800 numbers would work." Roberts went on to become general manager of information systems at the company.
The mainframe is dead; long live the CIO
Gartner's Roberts recalls newspaper headlines from the mid-1990s stating that mainframe computing was dead, giving way to a new breed of open systems and integrated enterprise resource planning (ERP) applications.
"It was probably around that timeframe when the CIO was no longer delivering [technology] to individual managers [but] had a broader information delivery responsibility across the organisation."
"I think that once you have an enterprise-grade application, then it's no longer the IT manager delivering to the requests of individual line managers, for example, a purchasing manager saying built me a purchasing or order taking system or whatever it might be," Roberts says.
"The CIO no longer had an individual brief but rather started to operate as a member of the C-level suite because enterprise information was clearly critical right across the organisation."
Philipson believes that although the CIO role has become more common since the mid-1990s, there is still a "real mishmash" of job titles, depending on the size and type of organisation.
In fact, he believes that often there is no real distinction between the CIO, IT manager and MIS manager.
"There's always one person in an organisation who is the senior IT guy and their role is always reasonably similar," he says. How they differ is more a product of the size of the company. Any company large enough to have an IT department by definition has to have an IT manager. "The title doesn't make that big a difference to what their role is," he says.
Philipson continues: "You get guys working for 30-man organisations who run a dozen PCs who are called CIOs. [There's a] misconception that if you are a CIO and you are not an IT manager or MIS manager, you somehow have a more senior or more strategic role.
"That shouldn't be the case, but it sometimes is; in a large organisation you might have a CIO and half a dozen IT managers under you. There is no point at which you suddenly morph from being an MIS manager to a CIO."
He agrees that a CIO should be driving business strategy because they are at board level, they are a C-level executive. But in practice, that didn't happen, he says.
"Very few senior IT managers ever got beyond being IT managers and that's still the case now," he says. "With very few exceptions, senior management of an organisation always regarded the senior IT guy, whether he was called CIO or not, as [the IT guy].
He recalls conversations with CIOs in the mid-'90s where they felt they weren't getting the credit they deserved.
"Very few organisations had true CIOs in the way that they were true board members and part of the senior management team."
In most cases, this is still the situation today.
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