We have a situation where CIOs want to understand business badly and the rest of the organization wants to master technology—equally badly
In the sidelines of the recently concluded CIO&Leader Conference in Goa, we interviewed quite a few CIOs individually to have a better peek into their thinking—their roles as they see them, their priorities, their challenges and their ideas. Apart from latest buzzwords, technologies and specific challenges within their industries, we asked each of them what they think are the essential qualities of a good CIO.
The answer most certainly will not surprise you. What may is how unanimous they are about the answer. Few talked about technology—that was not surprising—but we expected to listen about soft skills or leadership qualities. But what we overwhelmingly heard was: “understanding of business”.
Yet, when we analyzed the data on the background of CIOs, almost all of them have spent their entire careers handling technology. Interestingly, a few come with non-tech educational backgrounds, such as CA but most have stuck to handling technology.
Now, there is nothing that says a technology person cannot understand business. He/she is as competent to understand technology as anyone else.
However, ‘understanding’ as an outsider and ‘doing’ as an insider are two different propositions. Increasingly, a few CIOs in the developed markets are beginning to come from direct business backgrounds—those who have handled business SBUs to those who have handled data analysis for the company. In India, it is rare to find that.
Now, take a look at the issue from the other side. With technology becoming all pervasive, most functional departments are realizing that technology is too interwoven with their day-to-day work to go running to an external tech department every time. So, they are increasingly looking at hiring in-department technologists. Marketing which Gartner said would buy more business technology than the CIO, have their chief marketing technology officers—well, that may not be their designation but that is what their role is. In corporate finance, that option is being actively discussed. With IoT, many of the ops teams are realizing the need of technologists in their own teams. And finally, of course, the big buzzword of our times—big data—is driving many companies to have dedicated data science teams. Despite all the discussion in the enterprise IT about big data, few companies have placed their data science teams with the IT department. And that is understandable.
So, we have a situation where CIOs want to understand business badly and the rest of the organization wants to master technology—equally badly.
While all this time, this was an undercurrent, the strategic ‘digital transformation’ journey that many companies are undertaking has only acted as a great leveler and is catalyzing the trend.
What is a possible solution? Rather than IT managers continuing to have an ‘outsider’ perspective and business functions trying to create their own, small (and hence inefficient, unsustainable) technology teams, what if we have a few technology guys who move between enterprise IT (needed so that they keep up with technology trends and technology management) and business teams while a few functional guys become part of enterprise tech teams. Not only will they get a better understanding of technology, they will also get a better perspective of how IT works. That may help them in thinking of newer possibilities using technology while being more realistic in their expectations from IT.
In short, organizations will gain immensely by facilitating lateral movement between IT and functional business teams. This will create organizations that are better poised to take full advantages of the tech-enabled business.
I see strong undercurrents that will lead to such a scenario, starting with start-ups and very large diversified groups, as these companies would value multi-functional skills in their people more than in older, single business companies. In addition, there are some industries, such as banking that are completely tech-driven, which may see this trend. But they may just be ahead of others. It is a trend that may well become mainstream.
What makes me say that is the way companies are appointing their chief digital officers. In a recent study we did, we found half of these executives coming from core business backgrounds. Organizations have begun to understand that strong understanding of both external business scenario and internal organizational dynamics are needed to lead this transformation. Those who have a good understanding of both business and technology would be best suited for these roles.
It does not stop CIOs from leading the charge, but nothing like if they have deep insider’s perspective of business, i.e. if they have actually 'been there, done that'.