CIO Tenure Worries: Are Competing Roles Dragging You Down?

With the men’s and women’s NCAA basketball tournaments wrapped up and the seasons officially over, the coaching carousel can earnestly shift into high gear. In the corporate world, while there may not be a uniform season for executive turnover, many recent headlines have been linked to the topic of “CIO tenure.”

Why Is the CFO Still Boss of IT?

There is some troubling new data related to the role of the CIO which, in turn, could point toward a direct relationship with CIO tenure. Half of the respondents in Diamond Management & Technology Consultants’ soon-to-be-released Digital IQ 2010 survey report that more than 30 percent of the dollars spent on IT is done outside of IT. Power in any organization usually follows those who can create new revenue and value, but our survey shows that 75 percent of the CIO’s innovation role is internally facing.

We surveyed 592 executives for this year’s study, with respondents comprising equal parts business leaders and IT leaders for purposes of balance. Questions cover an array of issues, ranging from attitudes about IT’s contribution to corporate competitiveness, to business/IT alignment, to IT management practices.

The Digital IQ results indicate that CIOs who are involved in the strategic planning of the organization are more likely to drive business success. At a time when technology is reinventing marketing and competition, and information is often the product, the CIO is the only member of the executive team who fills both “staff” and “line” roles. Moving forward, the trick will involve successfully managing these dual roles.

While this will keep many a CIO up at night, it begs the question, “How can CIOs be losing power and influence at the very time that they should be gaining it?” Apps for the iPhone are changing our expectations of mobile capability; Facebook has 400 million users; Coke and Pepsi have embraced social media as a new means to get their message out; the giant Siemens is using YouTube to tell its message to doctors and technicians alike; massive data mining is creating new insight, and data visualizations making these insights more usable—and the pace of change is increasing each day.

Forty-six percent of both business and IT executives surveyed for the Digital IQ say the CIO is not an active participant in their companies’ business strategy development. With developments in areas such as cloud computing and pay-as-you-go IT, business leaders will raise more questions about the role CIOs and their IT departments should play. With such uncertainty surrounding the CIO, it’s easy to see why a quarter of them are fired based on performance, and their average tenure still hovers between four and five years—with “burnout” and “poor fit” as the lead factors in many cases.

Integrating to Innovate

The top-performing companies in this year’s survey differentiated themselves by more closely integrating business and IT. However, based on the survey data, roughly half of respondents—both business and IT—are neutral or agree with the statement that the CIO does not have a positive working relationship with the company’s business leaders. Does that sound like a key ingredient for a lengthy CIO tenure?

Providing support for all internal functions of the company while also helping to provide information-based products and services, the CIO has become a sort of “Jekyll and Hyde” of the organization. Most firms are seeing a whole new wave of technology affecting marketing, service, sales, and brand. From iPhone apps to the incredible power of social media and everything in between, logic dictates that the CIO should have even more influence than ever—because technology is more important than ever to the creation of revenues and profits.

If a CIO cannot clearly define both roles, the two could be split up. “Administrative” tasks could be given to an executive who is not a C-level player, someone who likely reports to the CFO or the chief administrative officer. The line responsibilities could migrate to other line executives who have profit and loss responsibility.

CIOs who are involved in creating outside-facing innovation and demand, are the ones who will continue to earn the “C” in their titles. In our sample, only 25 percent of CIOs were involved in the creation of market-facing innovations. We also find those CIOs who are involved in the strategic planning of the organization are more likely to drive business success. So, now is the time to see how much you are contributing to growing the top line, and expanding the bottom line—unless you’re prepared to lose your “C.”

Chris Curran is Diamond Management & Technology Consultants’ Chief Technology Officer and managing partner of the firm’s technology practice. He writes the CIO Dashboard blog at www.ciodashboard.com, and can be reached at Chris.Curran@diamondconsultants.com or @cbcurran on Twitter.

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