by Martin Veitch

After Philip Clarke at Tesco, is the fabled ‘CIO to CEO’ switch about to become reality?

Jun 09, 2010
IT LeadershipRetail Industry

A couple of you have written to suggest that my recent blog about Philip Clarke’s appointment as Tesco CEO was unnecessarily downbeat, a cynical croak when a joyous hymn might have been more appropriate. So allow me to clarify a little.

For anybody who believes that CIOs should be able to continue their career path onwards and upwards Clarke’s rise is, of course, a totemic event. The old joke that CIO stands for Career Is Over is persistent because it all too often is literally true. Experts in information management often hit the summit of their careers with the CIO role and for others drafted into the role it can be effectively a demotion, a sign that your relevance is on the wane or you are seen as a junior partner. Like being made Minister for Wales, say, in the government, nobody can say it is not an important role but it is a niche rather than springboard for subsequent elevation to the top job.

What’s different in the case of Clarke?

The first thing to say is that Tesco is a very remarkable company that quite quickly has transformed its image from cheap-and-cheerless groceries box-shifter of Blighty to international innovator, all-round retailer and growth phenomenon.

Second, Clarke is a former IT leader (indeed, and unusually, he retained IT control even while running international markets for Tesco) and he is an example of the CIO as innovator and person able to create a backbone for business improvement. The loyalty card and Tesco’s supply-chain excellence had IT in their conception and execution, for example. So he had big, public hits when many IT successes are barely acknowledged.

Finally, in part, I suppose, because of his and Tesco’s successes in IT, Clarke had the opportunity to get out of the niche and show that he could contribute more. Not many CIOs get that chance, or if they do it is in remits where stakes are relatively low: change projects that are all too often SAP re-paint jobs, for example.

Most of the CIOs I have met fall into one of two categories, or have a high degree of one or other of the following characteristics. They are the steady-as-she-goes operators of IT departments making incremental tweaks along the way and ‘supporting the business’. Or they are the transformers who set out to dismantle information management and reassemble it into something new and dynamic. Very often, the latter types move on after a few years. See, for example (before he leaves for Alcatel Lucent) Robin Dargue at Royal Mail.

What’s still unusual, however, is that despite their famous remit to work across business departments, very few CIOs get to be CEOs. Why? I think predominantly it’s a cultural thing. The boards of large companies don’t see an ability (or more likely don’t even consider a potential ability) for the guy who has ‘run IT’ to run the business. But this might change for a number of reasons.

First, these people on the boards will often be in their 50s and older and will often have no working knowledge of what IT has done for businesses. They see IT as two or three per cent of revenue and therefore a small cog, rather than thinking about what technology enables and underpins. As the generations change, most new board members will have decent knowledge of IT capabilities and therefore fewer prejudices.

Second, directors (and especially non-executives on fat stipends) are unlikely to rock the boat by suggesting something as radical as substituting CIO for CEO. But as more businesses and business sectors realise they are in crisis, this may change and radical solutions will be considered.

Third, CIOs themselves, or at least a fair-sized minority, have the appetite for the change. They are ambitious and confident individuals with the gumption and impressive cojones to grasp the opportunity.

In sectors such as the media, for example, I can very easily see CIOs receiving Clarke-style elevations, and in 10 years’ time CIO to CEO it might very well be as common a shift as CFO to CEO.