2013 State of the CIO

Things are looking up for CIOs in corporate America. Our 12th annual survey shows that CIOs are raising the IT organization’s strategic profile. CIO tenure is up a little. Compensation is up a little. More CIOs are meeting with customers. And fewer IT departments are viewed as dreaded “cost centers.” Check out our exclusive research — based on a survey of 563 IT chiefs — for a snapshot of how CIOs are faring in their quest to become business strategists.

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

To generate goodwill with their peers, CIOs are completing quick-win IT projects for business colleagues and meeting more often with those stakeholders to find out what they need from IT. (Here are more strategies for “building bridges” with those business stakeholders.) Meanwhile, CIOs are delegating more tactical IT matters to high-performing direct reports, so the CIO can gain time to focus on strategic issues.

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

Fewer CIOs this year say their company’s business stakeholders perceive their IT organization as a cost center (15 percent, versus 21 percent last year), while a higher percentage are viewed as business peers engaged in developing business strategy (20 percent, versus 15 percent last year). Meanwhile, the number of CIOs who act primarily as “business game-changers” has more than doubled since 2010. A report analyzing these trends is available at the CIO Executive Council: council.cio.com/programs/fs2013.

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

CIOs who get out of the office and talk face-to-face with customers can come up with ideas for new products and fixes for systems that don’t quite work the way customers expect. CIOs with experience on the front lines of the business may even be able to help shore up relations with customers being courted by competitors or spot new business opportunities. To be most valuable, collecting customer intelligence must be a sustained and focused effort (not just an occasional thing).

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

On average, CIOs are hanging onto their jobs a little longer. But it’s a tough job: They have to keep the email flowing and the data center cranking, while also trying to help the company boost innovation and revenue. Why do some CIOs stick around longer than others? They’ve avoided classic blunders (like IT projects with huge cost overruns). And they’ve developed a great relationship with business peers and, especially, the CEO. (Many CIOs don’t survive a CEO regime change.)

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

Conventional wisdom says that the CIO must report to the CEO or risk losing stature, authority and access to the power center of the company. Reporting to the CFO is bad, the theory goes, because IT is then viewed as a nonstrategic operations group where the governing principle is saving money. But that’s not always true. “What’s more important is whether or not the CIO is able to fully engage with the senior team,” says Tom Nealon, a member of the CIO Hall of Fame.

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

Average annual compensation for IT leaders hasn’t returned to the levels seen in 2008 and 2009, but at least it’s headed in the right direction. Compensation includes salaries, bonuses and stock options. Many CIOs are rewarded solely on IT achievements, such as projects finished on time and on budget. But now upper- tier CIOs have the added pressure of trying to hit a list of accounting targets that were once the burden of the CEO and CFO only.

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists

Most IT executives have their career roots in the technology organization. But for the minority who came from some other part of the business, operations (46 percent), administration (34 percent), customer service (33 percent) and shared services (25 percent) are the most commonly cited areas in which CIOs have career experience.

CIO.com Feature: More CIOs Are Gaining Stature As Business Strategists