by Edward Qualtrough

CIO 100 shows CFO losing power to strategy directors

Apr 23, 20154 mins
CareersIT Leadership

While nearly half of CIOs in the 2015 CIO 100 report directly to their organisation’s chief executive, fewer technology leaders are being managed by the Chief Finance Officer and are instead reporting to a head of strategy, more senior global CIO, or as part of a matrix system involving the CEO and another strategy or operations leadership role.

Some 49% answer to their chief exec, a small increase from 48% in 2014 – with just 19% reporting to the CFO, 8% to the COO and 24% to another role in the latest CIO 100, which recognised Anna Barsby at Halfords as the leading technology executive in the UK.

The CFO reporting line represents a significant drop from the 30% of 2014 – when 10% of CIOs reported to their operations chief and 12% to other positions.

Strategy reporting lines are well demonstrated at Channel 4 and rail project HS2, with CIOs Kevin Gallagher and James Findley both reporting to a strategy director.

The CIO 100 judging panel agreed that while it was generally desirous to have a direct reporting line to the CEO, being able to influence the business transcended reporting lines, while the increase of those managed by a strategy role confirms that technology is being seen less as a cost centre.

Catherine Stagg-Macey said: “A shift from reporting into the CFO to a head of strategy is perhaps reflective of a recovering economy, with an increasing focus on IT making a contribution to expansive business strategies.”

Fellow CIO UK columnist and CIO 100 judge Ian Cox said: “There does seem to be a general trend across all the statistics that indicates the CIO role is becoming more strategic in organisations that are looking to transform and invest in digital initiatives.

“And, not surprisingly, this is particularly notable in the top 20 which are of course the most transformational CIOs.”

Even without a direct reporting line, the CIO 100 shows most senior technology executives enjoy a high degree of proximity to their chief executive, with 44% telling us they meet with their CEO at least once a week to discuss business strategy.

While this is lower than the 49% we reported in 2014, we asked expressly this year about meeting to discuss overall business strategy.

Board level representation among the CIO 100 was down from 50% in 2014 to 37% – although an overwhelming 93% told us they sit on some kind of management or leadership board. In 2013 78% of CIOs told us they held a position “sitting on a leadership board driving business decisions”.

The panel again noted the ability to influence the business was perhaps more praiseworthy if they did not formally have the same CEO and board proximity.

Matt Ballantine commented: “A great business leader will have influence and be able to achieve what they need to do irrespective of reporting lines; ultimately they need to be able to win the trust and minds of just about everyone at board level.”

Former CIO 100 high-flyer Ian Cohen added: “Certainly if you report to the CEO you have a formal route but equally there are CIOs who report functionally and have developed a great relationship with the CEO and other leadership executives.

“You could argue, in this regard, they exhibit greater influencing skills and transformational qualities as a result.”

However, Ade McCormack warned against complacency and suggested IT leaders needed to evolve to stay relevant and guide the business in the digital age.

“I think the radical shift in respect of the CIO’s relationship with other CxOs is in line with digital disruption,” McCormack said.

“This is uplifting, but may only be temporary given that many CIOs signed up to manage the technology rather than leading digital. The extended remit may either not appeal, or even be a competence too far.”