News Feature

Dotted Lines Do Little for IT Organization

May 27, 2005 — CIO — By N. Dean Meyer

I’ve met so many corporate CIOs who have “dotted-line” responsibility for decentralized IT groups. Business-unit IT groups report (solid line) to their business units, and also report (dotted line) to the corporate CIO.

One CIO with such dotted-line relationships thought it meant that he was ultimately accountable for results of the corporatewide IT function, including the work of IT groups in the business units. As such, he tried to determine which things were done at the corporate versus business-unit levels. He sponsored corporatewide applications. And he established standards and practices.

Not surprisingly, business-unit IT leaders saw him as the enemy—micromanaging, controlling and dictatorial. They fought him and undermined his initiatives at every opportunity. It wasn’t long before they, with the help of their business-unit presidents, forced him out.

What do “dotted lines” really mean, and what can (and should) CIOs do with these quasi-supervisory responsibilities?

The Real Meaning of the Term
Some think that a dotted line implies some sort of supervisory responsibility. They grant that the business units can decide what is to be done, but corporate IT tries to decide how things are done (professional practices). Some even go so far as to influence career paths and contribute to performance appraisals.

Others think that a dotted line gives them some sort of power over people who don’t report to them. They feel they have the right to approve, or even command, activities done by (and funded by) business units.

Consider the “Golden Rule” of organizational design:Authority and accountability must always match.

Those with authority but without concomitant accountability are tyrants without checks and balances. Those with accountability but without concomitant authority are helpless scapegoats. A dotted line can be interpreted as either. It may mislead you to believe you can tell people how to do their jobs without accountability for their results; this naturally leads to open warfare. And it may imply accountability for the behavior of people you don’t control; this sets you up to fail.

Neither dynamic can work.

The truth is, dotted lines are meaningless. Business unit CIOs get their funding from the business unit, answer to the business unit president, and are quite willing to “defend” their business units against corporate meddling. A dotted line gives corporate staff no real authority over business-unit activities. And a corporate executive certainly must not accept accountability for others’ behaviors without any real authority.

So why are dotted lines drawn?

From a cynical perspective, it’s an attempt by corporate leaders (like the CEO) to make the corporate CIO accountable for things he or she cannot control. Said another way, it’s setting the corporate CIO up as a scapegoat to take the heat when business units misbehave. A CEO must direct staff through legitimate lines of authority—through business-unit presidents—not send the corporate CIO out to do his or her dirty work.