No longer are people sitting obediently in front of a television screen, reading full-age advertisements in newspapers, magazines or
brochures, or being seduced by expensive in-store displays. Customers
are flickering from one blog or social networking site to another,
sharing information about products and, worst of all, comparing
When Starbucks and Dell want customer guidance on how to transform
their products and services, they build customised portals for
discussion and deploy them globally in a matter of weeks. The portals
are becoming vital pieces of the marketing puzzle and the
A growing number of companies are tracking what's being said about
their brands on social networking sites, using software scanning tools
to monitor comments and to intercept live uploads over Wi-Fi networks.
But are chief information officers at the front line, helping to drive
the business forward? Are they working to ensure the business is not
blindsided by a more nimble competitor?
Few CIOs engaged
Most CIOs certainly want to, but few are truly engaged, according to
discussions we held with Australian CIOs. The enterprise often sees
CIOs are technology-enablers rather than strategic thinkers.
One CIO confided: "Many companies have Baby Boomer directors on the
board who do not understand how technology, process and business value
go together. They have that attitude that the information technology
department is there to make sure the PCs work and that costs are
Companies which run their businesses in silos are also finding it
difficult to integrate the ever-splintering channels and segments now
being traversed by their customers. Some marketing executives still
use the Web presence as a brochure or single-mindedly try to
'monetise' their site rather than noticing how customers are using
Sale in the mind
If marketing executives are expecting a customer to walk into the
store seeking to be persuaded and marketed to, they have missed the
point. For nearly half of them, the sale has already taken place in
the customer's mind.
From an executive search perspective, it appears that IT departments
have the power, but often not the business acumen and understanding.
And if they do possess good strategic knowledge of the business, they
often don't get mindshare at leadership team level.
Morris Lieberman, global process director of the liquor giant
Foster's, was fortunate to have a career path which included
accounting, finance, marketing and sales before moving into IT. He is
a strong advocate of technology executives knowing, and talking
business rather than technology. "I think many IT executives believe
that if they have the technology under control, they can enter the
boardroom and start talking about value-adding things without really
understanding what value-adding means from a business perspective."
Lieberman advises that in order to expand their value, CIOs firstly
need to deeply understand the real customer-the one who buys the
While on the Asia Pacific leadership team as CIO at the confectionary
company Cadburys, Lieberman was involved by the CEO in strategic
issues such as the entry of the company into the Vietnamese market.
"While technology was a minor part of the process, I was involved in
the detail of the marketing approach and the competitive outlook as
well as the whole route to market," he says. "As the CIO, I was
treated as an equal in those discussions. I gained respect through my
business understanding, not because of my IT knowledge."
Lieberman says that truly transformational change will occur only when
the "Boomers in the boardrooms and management teams" are replaced by
younger, more tech-savvy directors and executives.
Phil Thorpe, former enterprise systems architecture lead and business
improvement expert at BHP Billiton and now working on a change
programme with the National Australia Bank, agrees.
Thorpe says change is working its way through other industry sectors,
where learnings from supply chain and traditional back office
functions are being used to reinvent the way companies do business.
He cites Virgin Airlines, which has moved its former intranet-based
pre-flight bag check function to the Web to save both airline and
customers time and money.
At the NAB, business executives are regularly being involved in
technology immersion trips to the United States and India where they
can take time out of their day-to-day business functions to explore
possibilities offered by new advances.
Technology executive Tam Vu has seen the challenge from both sides of
the fence, firstly as CIO in an Internet business, the online jobs
company Seek, and also as CIO within a more traditional business.
"At sat at the executive table at Seek, so setting the technology
direction was easier," he says. "The role then turned more to solving
business challenges and how to facilitate a conversation rather than
to present a technology solution. The challenge was to ensure the
business felt as if it was part of the solution development."
In the more traditional business, Tam Vu found that he did not have 'a
seat at the table' when it came to helping the business with customer
acquisition and retention.
Coalition of the willing
He advises CIOs to 'build a coalition of the willing', getting the
passionate business people on board in terms of the customer agenda
and how technology can help achieve their goals.
At Heidrick & Struggles, we believe that today's CIO needs to have a
deeper understanding of business than has previously been a
requirement of the role. They also need to understand the power of
digital marketing and how customers can be found and retained.
Role attributes include a broad understanding of technology, but
additional experience in other facets of business. Often we are
finding such people in unlikely places-sectors other than the classic
IT stream. It is no longer enough to have had a career path through
the IT development ranks.
The successful CIO in the 21st century needs to earn a seat at the
decision-making table by dint of a personality imbued with knowledge
and clarity of business purpose, with powers of persuasion and with
the humility to 'take the team along with them'.
Tim Brewin is a principal in the Melbourne office of Heidrick & Struggles. Ian Smith is a partner of Heidrick & Struggles, based in Sydney.
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