From CIO to CEO: Beat the Odds and Make the Jump

By Elizabeth Harrin (London)

If I don’t have my BlackBerry I don’t feel properly dressed. Given that technology has such a big role to play in our business and personal lives, you would have thought that the Chief Information Officer (CIO) is a crucial lynchpin in any organisation. For the most part, CIO’s are seen as important people – but they are just not quite CEO material. The rest of the C-suite see them as slightly geeky and lacking the range of skills required to cut it at the very top. It’s rare for CIOs to make it out of the server room and into the chair at the head of the table.

Of course, there are some exceptions. Philip Clarke, CIO of Tesco, is taking over from Sir Terry Leahy when he retires next year. Of course, Clarke runs the international wing of the UK retailer as well as steering the technology division. It doesn’t look as if his new job title will start a sea change in CIOs becoming top dog. Will CIOs still sadly joke that the acronym stands for Career Is Over?

So why have so few CIOs made the leap to running a company – and how can they get there?

What’s holding CIOs back?

“One challenge that CIO’s aspiring to the top seat may face is the singular dimensionality phenomenon,” says Dr. Karen A. Hebert-Maccaro, Visiting Assistant Professor of Management at Babson College. “While their technical expertise may be unquestioned and perhaps is the reason they made it to CIO, it can be limiting if they are perceived only as technical experts as a CEO needs to have a firm handle on all the core functions of an organisation. Second and related, CIOs run an inward focused function in most organisations; their customers are the organisation’s employees. It may mean that IT is seen as a non-core function and the CIO someone with little first-hand understanding of the consumer.”

Lack of customer-facing experience generally means that CIOs don’t have experience running profit and loss, which is considered a de facto requirement for running a business. “Right or wrong, many CIOs are seen as ‘cost center’ executives, which has a negative connotation, i.e. the one who spends big dollars for questionable results,” says Todd Ordal, a strategy consultant and executive coach, and ex-CEO. IT divisions do contribution to shareholder value, so they do impact the bottom-line in that sense, but compare that the experience of the Chief Marketing Officer and it certainly feels like CIO’s have limited exposure to activities that actually make any money.

“Many CIOs are not as ‘people oriented’ as those who end up in the CEO’s office,” Ordal continues. “They are focused on systems and things rather than people – often brilliant but introverted. Many CIOs don’t seem as driven to aspire to the CEO’s suite as those who come up through marketing or operations. Their motivation is different.”

Marketing or operations people may certainly bring strategy skills to the C-suite that the CIO lacks. CIO Magazine research shows that only 21% of North American CIO’s can be characterised as business strategists or what they call Future-State CIOs. That is, people who are seen to influence and enable externally-facing business strategies, such as knowing a company’s market, understanding customer concerns, and identifying new revenue opportunities. Research from Santa Clara University also points to a lack of business understanding and strategic vision amongst CIOs. To be a success, the business strategist CIO must have an overall grasp of the business well beyond the server room.

New Visions for CIOs?

IDG’s CIO Executive Council, a global IT peer advisory community of 750 global enterprises comprised of more than 1,400 IT leaders, recently announced the release of the Future-State CIO initiative. Developed by CIOs from companies including Chevron, H&R Block, and Raytheon, framework details the strategies and tactics for CIO’s to grow their skills from a function head role, to a business strategist position within their organisation.

“During regular meetings with Council members and other CIOs we have been able to gain a deep understanding of their pain points and success stories during their evolution into business strategists,” says Pam Stenson, SVP and general manager of the CIO Executive Council. “This insight has been the catalyst for several initiatives – peer match discussions, Pathways mentorship programs and more – to help the industry overall in making strategic IT and business decisions.”

Even without a formal program, all is not lost for the CIO wanting to make the jump to the CEO position. “Assuming a CIO has a solid set of business and management skills, a proven track record of success, and a desire to transition to CEO, she would need to demonstrate multi-dimensionality,” explains Hebert-Maccaro. “In other words, find and exploit opportunities to demonstrate deep and strategic understanding of the core functions, key organisational issues, competitive landscape, and bottom line results. An argument can be made that a CIO, by virtue of the need to support and integrate across the enterprise, has an advantage in understanding the various facets of the organisation and its people and, if she can leverage that experience, it could be a tremendous asset. If a CIO can demonstrate the ability to go beyond the technical and think strategically beyond the internal, the path to CEO should be that much easier.”