How can we support the introduction of new services while avoiding the disruption of existing services? How can I reduce costs while improving services? How will I balance the need to influence business strategy with the need to provide top-notch IT support? In January to April this year, IBM interviewed more than 2500 CIOs across the globe on the daily demands they face. And from the hour-long interviews, the above questions emerged as those that CIOs are asking themselves on an ongoing basis.
The results of the survey, which IBM says is the biggest of its kind, paint a picture of three distinct roles that successful CIOs have to take on simultaneously if they are to answer these challenging questions.
For the first challenge, they take on the role of an insightful visionary and an able pragmatist. For the second, they become a savvy value creator and a relentless cost cutter. For the third, they have to be a collaborative business leader and an inspiring IT manager.
And while these roles seem contradictory, they are actually complementary, IBM says in the report “The New Voice of the CIO”.
IBM says when CIOs combine these roles, they make three things happen in the enterprise: they make innovation real, raise the ROI of IT and expand the impact of the business.
In making innovation real, the report says when the CIO is acting as an insightful visionary they push for a broad technology strategy to help business profit from leading edge initiatives. On the flipside, they take on the able pragmatist role that facilitates the productivity of current IT systems to free more time and budget for innovation.
On raising the ROI of IT, the CIO as a savvy value creator uses IT to produce greater business value, and combines this with a focus on lower costs and greater efficiency. Combining this with its counterpart, the relentless cost cutter, the CIO manages budgets and processes to eliminate or cut costs.
On expanding business impact, the CIO provides expertise in business and technology. The CIO works as a collaborative business leader, working on new business initiatives and cultural changes with other C-suite executives. At the same time, the CIO takes on the role of an inspiring IT manager, motivating the team to deliver superior performance.
Juggling multiple roles
It is a tricky role, a balancing act in fact, says Ross Pearce, managing consultant, IBM Global business services in New Zealand, on being a CIO today.
In regards to the graph illustrating the interaction of the three dual roles, Pearce points to the roles at the bottom of the CIO helix (above) – the able pragmatist, relentless cost cutter and inspiring IT manager.
In these, he says, CIOs have to balance day to day issues of keeping costs under control and running an efficient department, while delivering what the organisation needs.
He then points to “top level things” they need to do, referring to the three roles above the graphic — insightful visionary, savvy creator and collaborative business leader — providing the vision of what technology can bring and continually demonstrating how IT can add value.
The report quotes the CIO of an electronics firm who sums up the challenges CIOs face: “In IT, we are not magicians, but we are certainly jugglers”.
For Pearce, however, it is another circus performer that presents a good picture. “The guy on a roller and a seesaw, where the seesaw goes on top of the roller would be a great analogy” for the CIO role, he says.
The able pragmatist in action
Pearce, the New Zealand leader for the study, says there were 129 respondents from New Zealand and Australia. The report points out that while ANZ respondents, of which one-third came from New Zealand, share characteristics with their global peers, there are distinctive regional challenges and dynamics which drive behaviour.
The result is a local CIO profile of an “able pragmatist”.
“This is not to say they did not focus on the future, but they are probably more generalist in their approach,” says Pearce. At the same time, he says it is interesting that the ANZ CIO comes out as a savvy value creator rather than a relentless cost cutter. “There was much more focus on how can we create value, getting the business to understand what value IT adds as opposed to continuously cutting costs.” He says it could be because the latter has been a focus of ICT departments in ANZ for at least two years now.
The third arrow on the right of the graphic indicates ANZ CIOs as collaborative business leaders. It is about “taking your IT hat off momentarily and acting as a senior leader for your business and your organisation, therefore fully contributing to strategic conversations about where this organisation is going and how we are going to get there.”
He says New Zealand CIOs are seen as a key member of the senior management team, and this is supported by the fact most of the CIOs in this part of the world report directly to the CEO. The CIO survey supports this, reporting that 77 percent of ANZ CIOs hold a seat on the senior management team, while only 54 per cent have this kind of influence elsewhere.
Elaine Mead, managing consultant, IBM Global Business Services and local coordinator of the study, says the respondents were grouped into high-growth and low-growth CIOs, based on the profit growth of the company over three years.
The report points out the ANZ market is dominated by medium sized distribution and industry sector businesses, with 60 per cent of CIOs working in organisations with 1000 to 10,000 employees. The report says CIOs in these businesses tend to enjoy a closer relationship with the CEO due to smaller organisational size and fewer layers of management complexity. “These CIOs tend towards pragmatism in their approach, yet still continue to be savvy in the selection and application of technology, deserving of the title ‘able pragmatist’,” says Pearce.
Mead says it was interesting that in New Zealand or Australia, there were a number of smaller size organisations under the high growth category. These CIOs were seen to be quite focused on innovation, or thinking of new and smarter ways of doing things.
Whatever the challenges today’s CIOs face, the survey respondents show they are working on the ‘I’ in their titles — which stand for both information and innovation.
The report says CIOs spend an “impressive” 55 percent (45 percent in ANZ) of their time on activities that spur innovation. These include generating buy-in for innovative plans, implementing new technologies and managing non-technology business issues. The rest (55 percent in ANZ) is spent on the essential, more traditional task of managing the ICT environment — reducing cost, mitigating enterprises risks and using automation to reduce costs elsewhere.
IBM says all CIO respondents point out they can only give more attention to new technologies after addressing current IT needs.
CIOs across the globe think alike when it comes to priorities for plans to enhance competitiveness, the report states. But when ANZ CIOs were asked about the technology needed to drive this competitive advantage, they nominated all aspects of technology. The report links this to the generalist nature of their responsibilities, as against the more specialised CIO roles in other parts of the world.
Recurring issues for NZ CIOs
An issue which came up in conversations with local CIOs is around building capability within their teams. Says Pearce, “How do they build capable people at the next tier below, so that would give the CIO more time to focus on the more visionary or strategic things?”
Being generalist CIOs means having to deal with more issues, says Pearce. “The business would see them as the fountain of all knowledge when it comes to how IT can enable the business.”
This has its advantages and will potentially make them better candidates for higher roles, including chief executives. They also have skills that are exportable to other industries.
Pearce says it is interesting that a lot of private sector CIOs are taking on key roles in the public sector. “They see that as a new challenge and making a big impact as well, so having those transportable skills is an advantage,” says Pearce. “You don’t see too many CIOs who become CEOs but there are a few examples around and I bet you they have quite a breadth of previous business experiences.”
There is, however, a flipside to being a generalist CIO. “You run the risk of becoming a bottleneck for the business filtering everything to you,” says Pearce. “That is why a lot of CIOs are addressing this issue; how do we find people who are part of the IT team but could speak the business language?”
Pearce says some of the bigger ICT organisations in New Zealand have created a “relationship manager role” that reports directly to the CIO. These managers, also called account managers, engage with different parts of the business and find out in detail what their needs are and come up with an ICT solution to help them. Pearce says the rise of these roles is important for ANZ CIOs who have less specialised roles than their counterparts in other countries.
Pearce says an issue facing some CIOs is around conveying in lay person’s language the value that they can add to the organisation. This is particularly true for CIOs who came up through the ranks as an IT specialist and their exposure to the business has not been that extensive, says Pearce.
The way they present ICT programmes to the executive team is important, he says. “I don’t think there is such a thing as an IT project, it is a business project enabled by IT. That is the key thing that CIOs have to get across to the business.”
Even then, the report says experienced CIOs admit to being strong in just one or two of the six roles and need to work on each of these roles.
To be a successful CIO, concludes Pearce, “You have to take the whole lot, and the balance may vary depending on the circumstances you find yourself in.”
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