When Times Change, Leaders Obtain New Skills

Over the last 20 years, as the CIO role has changed, the competencies required to succeed have changed, as has the level of performance expected for CIOs to be successful. And it’s getting harder for CIOs to distinguish themselves as outstanding.

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How the CIO role has evolved

Be a strategic CIO

As noted by Carl Wilson, 20 years ago the focus of IT was on technology only, and that technology was fragmented. The key priority for IT managers was keeping all those wonderful mainframes, minicomputers and PCs happily running in their own little worlds. Even within IBM’s world, 3081s did not talk to AS/400s and definitely did not talk to PC-XTs. Thus, a limited number of relatively low-level competencies were all that was required to succeed: functional technology expertise with a dose of results orientation, a dash of team leadership and a sprinkling of people development expertise.

Ten years ago, as devices began to communicate over networks and the Web became a business tool, CIOs began to be recognized as potentially key players in the C suite. Additional competencies, such as their ability to influence decisions across the organization (the competency of collaboration and influence) and to align groups (the competency of change leadership) became increasingly important to their success.

The variety of competencies required for the CIO job and the level of performance expected of IT executives continued to increase as IT systems grew from a support function to become entwined with the business itself. In the late 1980s, Bob Crandall, then chairman and CEO of AMR, stirred controversy when he said he would rather sell the airline than the Sabre reservation system. In this new world, strategic orientation, commercial orientation, external customer focus and market knowledge became important in ways never before imagined.

In 1999, Compaq chose its former CIO, Michael Capellas, to be the CEO, awaking people to the possibility that CIOs could run major companies. But although the CEO job may be attainable for the best CIOs, the rest may actually be falling behind the performance curve. As business becomes more global and the line blurs between IT that supports the business and IT that drives the business, the expectations of the CIO are increasing both in breadth and depth. This trend is widening the gap between the best and the rest.

The number of competencies C-suite officers must perform at the outstanding level (the top 15th percentile in our scoring range) has risen. At the same time, the gap between good and outstanding performance by CIOs is double that of other C-level executives. This means the good performers are lagging or falling behind in meeting the demands of the role.

The CIO of 20 years from now will need to be a technology-savvy, global strategic visionary who can empower and inspire people, transform a business, understand corporate financials and deal with Wall Street. Any takers?

C-Suite Leadership Competencies

Based on decades of research on business executives, talent search and measurement firm Egon Zehnder International has boiled down nine competencies that separate great C-level leaders from good ones.

1. Strategic orientation: The ability to think long-term, leveraging business awareness, critical analysis and integration of information to develop an action-oriented plan.
2. Results orientation: A focus on improvement of business results.
3. Commercial orientation: Identifying and seizing opportunities to increase profit and revenue.
4. Market knowledge: Understanding the market, including competition, suppliers, customer base and regulatory environment.
5. External customer focus: Serving and building value-added relationships with customers or clients.
6. Collaboration and influence: Working effectively with others, including internal customers who do not work for you, to have a positive impact on business performance.
7. People and organizational development: Developing long-term capabilities of others and the organization as a whole.
8. Change leadership: Transforming and aligning an organization through its people to drive for improvement in a new and challenging direction.
9. Team leadership: Focusing, aligning and building effective groups in one’s immediate organization.

Reynold Lewke is North American CIO practice leader with Egon Zehnder International. Steve Kelner is global knowledge leader of Egon Zehnder’s Talent Management and Management Appraisal Practice Group.