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Issue of September 2004 

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Are CIOs Operational or Business leaders?

Most CEOs view their CIOs as trusted operational leaders; few CEOs regard their CIOs as business leaders--despite most CIOs' belief to the contrary. These are the findings of a Gartner report titled "Improving the CEO's view of the CIO."

Analysts at Gartner Executive Programs (EXP) feel this gap in perceived abilities limits the CIO's opportunity to deliver greater value to the enterprise. In a recent Gartner survey of more than 450 non-IT business managers, the IT leader was ranked next to last among eight senior executive positions, according to significance in setting strategic direction for an enterprise. Last place went to the Human Resources leader.

Yet the new Gartner report shows that most CIOs have an opportunity to change this situation, improve the relationship with their CEO, and create more value for the enterprise by becoming less risk-averse and extending their role outside traditional IT activities. In short, the potential exists for the age of the operational CIO to be eclipsed soon with the CIO ascending to a more strategic role.

Gartner analysts suggest three reasons for the often-strained relationship between CEO and CIO. First, CEOs are overloaded and simply do not view IT as a top priority. Marcus Blosch, Vice President and Research Director at Gartner EXP, said the fundamental gap in how the role of IT is viewed by many senior executives can inhibit business growth.

Business Priorities

CEOs and CIOs also have very different perceptions of business priorities. In 2004, CEOs are focused on revenue and growth, yet most CIOs believe that security, cost and privacy are the top three drivers on the business agenda. This difference in focus limits the credibility of CIOs, often impeding their ability to contribute at board level. Gartner acknowledges that whilst it is imperative for CIOs to deliver on key issues such as security, they must also recognize the importance of aligning and engaging with the CxO agenda if they are to add real value to the organization.

Finally the Gartner study points to differences in CEO and CIO business styles and behaviors. CEOs are more optimistic, evangelizing and idea generating, whilst CIOs are more conservative, and focused on detail, implementation and closure. Moreover, profiles of other CxOs are closer to that of the CEO. As a result, the CIO often is perceived within the group as something of a 'naysayer' with a focus on the operational and system complexities involved in enterprise change. This can make CIO contributions seem out of step with the CEO, executive committee or board, with the CIO often seen as lacking vision and dynamism.

According to Dave Aron, Research Director at Gartner EXP, "The challenge for the CIO is to move out of the IT space and their comfort zone to demonstrate deeper business knowledge and leadership. In the words of one of the CEOs interviewed, the 'Super-CIO' needs to be 'bilingual' - able to communicate and engage with the wider business organization as comfortably as with the IS organization."

A shift in CIO behavior

To make the most of the relationship with the CEO, the CIO must shift from task- to relationship-oriented behavior, from management to leadership focus, from relying on control to learning to influence and from drawing on an IT knowledge base to drawing on a business knowledge base. Above all, Aron said, "CIOs need to learn to take risks and feel comfortable operating outside their area of expertise. It is only then that they can truly take on the challenge of aspiring to real business leadership."

Gartner's view on the future for the CIO remains positive. "The CEO's view of the CIO is changing as enterprises become more reliant on IT," Aron said. "I firmly believe that many CIOs can move toward a business leadership role by effectively managing their relationships with CEOs and other executive peers."

— Mumbai Bureau

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