Stefano Maifreni is Founder & Director of Eggcelerate, the business expansion advisors.
Companies rely more than ever on IT — but CIOs are losing their seats on the board in surprising numbers. So, what’s happening? How can tech chiefs survive at the top level?
Today, fewer Chief Information Officers sit in boardrooms – reducing from 71% to 58% in just two years, according to research from Harvey Nash/KPMG . Moreover, that’s at a time when Gartner predicts global spending on IT services is growing by 3.2% to a jaw-dropping $3.8 trillion .
So, what’s happening?
It seems ironic that in the age of digital transformation, the CIO’s role is diminishing.
At first glance, it looks like as if other parts of the business are cannibalising the traditional CIO role. For example, Marketing, Sales and Finance can bypass IT altogether and make important tech purchasing decisions for themselves.
These departments still need IT to provision their phones and laptops, as well as providing a fast connection and corporate security. However, they often purchase what they need from cloud-based services in a way that’s fast and scalable. Their ‘shadow IT’ is towering over traditional IT.
So, it would seem as if CIOs are merely a casualty of new realities: Once they lose their executive status, life will carry on as usual for everyone else? However, something bigger is going on.
The whole deck is shuffling
While CIOs face changing times, so do others. In fact, around the boardroom, every CxO who wants to survive will have to focus increasingly on the value they add to the customer experience.
Take the Chief Marketing Officer (CMO), for example. Back in the day, the CMO might have been on the fringes of boardroom discussions, but getting involved around branding, product launches and campaign ideas to energise sales.
Over time though, the CMO is becoming more like a Chief Customer Officer, in charge of all customer interactions and experience. The worlds of account management, customer service and social media are blurring — so the CMO’s role is having to do the same.
Increasingly, many CMOs will act as “Product Managers”, where the product/service they’re developing aim at expanding the Customer base, improve their Customer experience, increase engagement and drive growth. They’ll need to take ‘intrapreneurial’ responsibility for transforming an idea into RoI using innovation.
However, they’ll have to execute through others. So, they’ll be needing the CIO and the COO for this — teaming up in a new kind of relationship
How CIOs can thrive
Increasingly, companies will be looking for differentiation. It won’t just be about “How can I purchase a similar cloud service to all my competitors?”, it’ll be about “How can we get the edge — so our customers get a superior experience?”
As a result, new doors are opening for the CIO. They can switch from being an internal IT function to being viewed as an expert advisor to the business, with a clear vision, strategy and understanding of the impact on customers from every technology decision.
Marketing, Sales and Finance would struggle to enlighten the boardroom about using data in creative new ways, improving algorithms, or the latest machine learning techniques to predict churn. However, tomorrow’s CIO will focus on the fine detail that makes the difference.
On the one hand, they’ll be IT scientists with deep subject expertise. On the other, they’ll be delivering and managing innovation. As technology races ahead, they’ll be the ones ensuring the boardroom can keep up.
Also, watch out for a rising star — the Chief Operating Officer (COO). They’ll work closely with the CIO and CMO, making sure the whole technology stack works smoothly, end-to-end, with the customer in mind. Increasingly, they’ll be known as the Chief Customer Experience Officer.
A challenge for every boardroom
The fact that 42% of companies no longer have a CIO at the top table isn’t a sign of progress — it could signify a costly miscalculation. It’s a symptom that boards may have missed something critical, possibly viewing IT as an overhead rather than realising its true potential as a differentiator.
be customer-focused, the roles of each CxO around the boardroom and the
relationships between them will need to adapt continually. The CIO happens to
be the first in line. When roles shift with the times, companies become more
agile and focused on delivering what the market wants.