IT strategy: Group hug

It is fair to say that the historical relationship between many FDs and their
CIOs has been characterised by mutual suspicion, misunderstanding and, in some
cases, hostility. In fact, it has long been argued in certain quarters that FDs
should be entitled to an open season when they can hunt down CIOs and put a stop
to their techno-tomfoolery.

The justification for this harsh stance on the sandal-wearing,
acronym-spouting, binary watch-touting technology professionals is, of course,
cold, hard cash. Return on investment for these wheelbarrow-loads of money has
often been creatively referred to as a bit of a ‘grey area’. Spending on
roll-outs of some of this ‘must-have’ technology has, for many companies, been
accompanied by little or no quantifiable business benefits.

But this, of course, is only half the story. Seen from the perspective of
hard-working IT professionals, many FDs are demonised as narrow-minded,
suit-wearing, number-crunching, legume quantifiers. It is widely argued by the
geeks that these killjoys do nothing but rein in legitimate attempts to boost
competitive advantage and improve process efficiency by buying the latest and
greatest technology known to humanity.
However, there are signs of a rapprôchement that could see the twain of
CIO and FD finally meet in harmonious union. Recent research highlights the many
and varied commercial advantages to be accrued by firms that manage to bury the
hatchet between these historically bitter adversaries.

It is perhaps even more telling to take a step back from the actual words and
look at the origins of these two reports. The first is firmly in the IT corner,
coming as it does from technology analyst firm, Gartner, while the second, an
Ernst & Young study, fights the FD’s corner.

Gartner’s report, Meet your Next CIO, advises senior IT pros,
including those currently working as CIOs, to make 2008 the year when they
acquire at least one or two years of non-IT business unit management. Only if
they broaden their horizons in such a way will they be able to progress up the
greasy pole to what the analyst firm described as the “new” CIO roles of the
future which are becoming increasingly focused on business, rather than
technology.

This advice follows on from what Gartner describes as some “intriguing” CIO
hiring trends. Its research notes that CIO candidates are not required to have
formal technology-orientated backgrounds. Gartner polled recruitment
specialists, asking whether CEOs were looking for particular educational
backgrounds and technical know-how. The answers were that CEOs had no preferred
educational backgrounds: one said: “When push comes to shove, it doesn’t
matter.”

This is not to say that corporates are just grabbing the nearest passer-by to
take over their IT departments. Professional qualifications and competence are
still necessary for those wanting to become CIOs. But the new approach does mean
that suitable executive candidates, often from other parts of the business, will
increasingly be selected on merit to take over responsibility for what has
historically been the CIO’s domain. They will then be given the relevant
technical training on the job.

What is important is that these “new CIOs” must be able to show that they
understand the needs of the business as a whole and not just maintain a narrow
technical focus. In recognition of this they will be working to a far broader
remit with much responsibility for business functions and divisions that have
been beyond the scope of the traditional IT silo.

The IT recruiters noted that experience in rolling out high-powered software
packages such as Enterprise Resource Planning systems meant that many CIOs had
good knowledge across the range of activity within their businesses. As a result
many have already reached the position where they are equipped to take on
broader, business responsibilities.

These sentiments were echoed by Ernst & Young. The firm notes that the
long-overdue reconciliation between IT and finance is also being driven by the
onslaught of compliance regulations which almost always have an equally profound
impact on both FDs and CIOs.

The Ernst & Young report, Successful IT in High-Performing
Organisations: The impact on business growth, notes that successful
organisations exhibit a sophisticated understanding of IT and a flexible view of
its function and reporting lines. These firms, the study urges, must employ a
variety of leadership structures to support integrated business and IT decision
making. One strategy is to promote existing CIOs to the board where they can
gain holistic business experience.

The fact is that, in today’s business world, IT must play a key role in
helping companies succeed. Technology is here to stay and needs to be made to
work hard to support core business objectives. Getting the relationship right
between FDs and CIOs – or whatever they will be called in the new corporate
world order where traditional roles are merging and morphing – is essential.
It’s nothing personal, it’s just business.