CTO: A Dangerous Title

CIO — The chief technology officer (CTO) job title has been floating around the IT industry for at least a decade now, so it's had enough time to settle in. And the places that it's settled are rather unsettling.

The title originated in technology vendors where the CTO was responsible for product research and development. It was quite popular in the dotcom companies of the 1990s, and from there spread to internal IT departments. And that's where the trouble began.

Of course, the exact meaning of the title is as diverse as the organizations that use it. But the four most common definitions all violate fundamental organizational principles and are unhealthy for the broader IT function.

IT's Chief Operating Officer
In some IT departments, the CTO runs the whole show. Virtually the entire IT staff report through the CTO (except perhaps for some support functions like the IT business office and the chief security officer). I've seen a number of IT shared services organizations where the CIO had only two direct reports: the CTO, and the head of the IT finance and planning group.

This manifestation generally indicates a CIO who's turned over his or her job to a subordinate. Perhaps the CIO is busy with corporate politics, with public relations (aka "golf"), or with meddling in (sorry, I should be diplomatic and say "coordinating") business-unit IT decisions via policies, IT staff career plans and "strategies." Or perhaps he or she is just retired on the job.

Whatever the CIO is doing, he is not delivering much value to the business. The CTO is.

A typical and proper span of control for a C-level executive is eight to 12 direct reports (presuming a capable leadership team at the next level). A span of two or three raises the question, do we need the CIO at all?

Even if the CIO's job is reasonably secure, her ability to contribute to strategic issues is diminished when people realize that she is effete. If you want to get something done in this company, you'll quickly figure out that you have to go to the CTO, not the CIO.

If the CTO title means running the entire IT shared-services organization, then a chief technology officer obviates the need for a CIO. Why not combine the two jobs and stick with the CIO title?

Engineering Czar
Another use of the CTO title is to describe a technology "czar" who makes all technology decisions for the entire IT organization. In these organizations, the CTO manages all the IT engineers—generally, although not always, including applications engineers as well as desktop platforms, end-user computing and infrastructure engineers.

To make a case for such a concentration of power, people cite the need for an integrated vision of future technologies, one that overcomes an existing mess of fragmented systems.

So let's say you're the IT operations executive in this organization. Your job is delivering infrastructure-based services reliably and efficiently. But you have no say over what goes on your raised floor. The CTO decides for you. How would you feel?

Disempowered, to be sure. You probably realize that you're set up to fail. Look at the incentives built into the organization.

Engineers love innovation and are rewarded for their technology designs, but they aren't held accountable for cost-effective, stable operations. In pursuit of the "right" technologies, you'll be given the latest and greatest... at any cost. And when the engineers in the CTO group decide to try out some bleeding-edge product, you'll take the fall when it proves unreliable.

This structure is like allowing Hewlett-Packard to decide what computing platforms are used at America Online. How can we hold IT operations accountable for the performance of the infrastructure when they have no say over what that infrastructure looks like!?

The answer is, we can't. Authority must match accountability, in every part of the organization, all the time. This is the "golden rule" of organizational design.

When the CTO title is interpreted as a technology czar, the operations group becomes a passive dumping ground and cannot deliver or be held accountable for the cost or quality of its services. This is absolutely counter to my vision of a healthy organization where everybody is an internal entrepreneur empowered to run a business within the business.

The Lone Genius

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