Taking the Temperature of the CEO-CIO Relationship

Organizations still have plenty of work to do in building a strong business and IT coalition, according to new research by Diamond Management & Technology Consultants. Here's a look at the state of the CEO-CIO union, from the front lines.

While they are not Felix Unger and Oscar Madison, a company's CEO and CIO can at times make a fairly odd couple. Differing agendas create significant challenges from the outset. At the same time, we all understand it is critical for the CIO to engage the CEO and senior business leaders in discussions of IT investments. Considering those somewhat contradictory points, what exactly is the state of the union between business and IT leaders?

[For more data on today's CIOs and their relationship with the business, see CIO's 2010 State of the CIO results]

A few years ago, Diamond Management & Technology Consultants launched a broad annual study of various business leaders' "Digital IQ." Through the Diamond Digital IQ research, we seek insights into the challenges companies face associated with connecting the enterprise's strategic objectives with the actual business value—which is often reached several years after the big ideas are hatched.

The 592 survey respondents this year comprise equal parts business leaders and IT leaders for purposes of balance. The survey covers an array of issues, ranging from attitudes about IT's contribution to corporate competitiveness, to business/IT alignment, to IT management practices. The industries included in the survey are large or very large companies in banking, financial services, insurance, and consumer products, among others. Some of the most instructive responses in Digital IQ 2010 relate to the senior business executive support for IT.

Our CEO or senior-most business leader is an active champion in the use of information technology to improve our business.

The promise of a fully integrated organization in which there are no formal "business" and "IT" distinctions must begin at the top. IT's capability must be viewed by all business leadership as both a driver of growth and a tool to improve efficiency. While 64 percent of respondents agree with this statement, I find it incredible that the figure is not in the 80 percent to 90 percent range. I was reminded by the CIO of an oil & gas company that "IT's role is not always strategic, and that's ok." In this case, I would expect the CEO to still be an active champion of IT to improve the business operations and efficiency (and the CIO to work hard to develop a broader perspective of IT's potential).

Our CIO is very involved in the business strategy development process.

Participants' responses here provide further insight into how much senior management teams buy into the importance of IT. Only 54 percent of respondents agree with this statement, which make you wonder what the other 46 percent are doing. An insurance executive told me a story of a claims initiative that some colleagues in "the business" presented to him, and which was later approved. The initiative involved the use of images, video, and audio to better understand the claims and so that experts could do more of the reviews and QA remotely. Late in the project, one of the managers came back to him and admitted a big mistake that would cost them several million dollars. Apparently, they forgot to estimate any storage for all of the digital media.

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