Will you need a CIO by 2020?

The title of my new blog post is provocative. Why would I ask such a question, especially after covering a number of CIO surveys, trends, and thought leaders, and underlining the strategic importance of IT in this very blog? 

I am asking this question because the IT landscape as you and I know it is changing and changing fast. Even by IT industry standards, the pace of recent developments is remarkable. The business technology is undergoing rapid evolution. And the central argument I am presenting here is that the conventional role of CIO or CIO function as it stands today will either be ineffective, redundant or outdated and hence not required by end of this decade. Let me explain...

There are a number of reasons and drivers for the rapid evolution of business technology. However according to me there are five major forces which are influencing this evolution. They are business services, application services, business analytics, consumerisation of IT, and cloud computing. I will try to explain them briefly.

Rise of business services

Awareness of the fact that, ‘Organisations purchase technology to fulfil business needs’ is growing like never before. Given economic challenges very few organisations can now justify technology investment for pure technology advantages. Your CEO, COO, CXO and CFO will be demanding ‘Return on Investment’ (ROI) and ‘Value for Money’ (VFM) from each £ invested in technology and they will most likely be demanding that in year one. Days of five- or even three-year technology payback are certainly behind us. And this is where purchasing business services independent of large technology investment is becoming so attractive. There are a number of examples of this trend, ranging from payment processing to HR processing.

A test question for you - If you were CEO of a mid-size organisation, would you invest £5 million in back office processing software, hardware, network, back-up, security etc.? Or would you sign up for business outcome based contract with niche business services supplier? I know your answer and mine is the same!

Maturing cloud computing industry

Enough is written about benefits of cloud computing (including this blog) so I won’t repeat it. However it is safe to conclude that cloud is more than hype. It is real and there is an entire industry being built around cloud propositions by all major IT vendors as well as rising number of niche players. Cloud computing, if adopted in right manner, frees your organisation from capital-intensive infrastructure and operations investments. The business justification will not be far different from the arguments I have listed above. Cloud computing, however, gives organisations the added flexibility of being able to build solutions to suit their requirements, yet allows them to offload its capital and resource-intensive aspects to infrastructure specialists. It can be easily argued that business services are a variant of cloud computing.

Another test question for you - You are a CFO of retail chain and you have a legacy retail management application. Your peak business transactions are expected only in the months of March, September and December but for all other months you operate at half the transactions of peak. Would you like to scale up and down the capacity and hence the cost of your retail application operations? I know your answer and mine is the same!

Business analytics coming of age

A large number of small niche companies and even large companies like IBM and Oracle are investing millions in developing and enhancing business analytics products and services and they are doing this for a very good reason. People like you and me (and multiply that number by millions of Indians and Chinese) are adapting to self-service shopping lifestyle. When was the last time you went into your bank branch? Or when was the last time you bought a book in a book shop? When was the last time you called your airline or visited its city booking office to purchase your airline tickets? I know your answer... we are relying more and more on smart, intuitive ecommerce sites, price comparison sites, shopping portals, kiosks, ATMs, etc. to buy everyday things of need and occasional things of desire. The merchants are looking for smarter ways to know you, your preferences, and your wish lists, and to keep your loyalty. This is true for brick-and-mortar businesses too by the way. And smart merchants are turning to business analytics to make more sense of their business transactions, shopping patterns, supplier dependencies, seasonality and thousands of other trends which affect their business.

Another test question for you - if you are a mid-size or small company COO running a brick and mortar plus an ecommerce portal for your business would you rely on your in-house MI experts to keep up with 1000s of changing patterns, equations, behaviours and trends? Or would you secure an external niche business analytics company to analyze tons of your business transactions, do the number crunching and present predictions for next quarter along with benchmarks? I know your answer and mine is not too different!

Popularity of application services

This may be very specific development but worth making a note of. You may recollect my earlier blog on ASOS and how smartly they are leveraging open access to their applications of catalogues. The Apple App Store is another example of this model. These smart technology and business models are making middleware software, hardware and tools almost redundant by giving core access to application tier of your business systems. Your suppliers and partners deliver direct to your application and data tier, why bother with message brokering? See my proposed revised retail reference architecture and you will know what I mean.

Let me not ask you a question but pass you my verdict on this one: No I don’t need an internal IT department to develop interface to launch my catalogue on Apple App Store. I will go to a niche small firm who will do it for me at fraction of the cost, to much better response times than an internal development and test department.

Spread of technology consumerisation

Again enough is said about Apple iPad, Amazon Kindle, and Android smartphones. The fact is, if you are reading this you have either all, or a minimum of one of them. And I know that you would prefer to carry your own iPad to work and do your office email and documents, as well as look for the best place for Thursday after-work drinks on Google maps on one of those boring conference calls. And if your organisation is not funding your smartphone then you do not mind getting on an attractive tariff to join swelling ranks of smart next-generation mobile workers. I am not even mentioning Google Docs, Microsoft Office 365 and other similar offerings which liberate corporate IT.

You know where I am going next. If your data privacy and security concerns were addressed, would you mind if your employees brought their own IT equipment to work? I would not. If I were CFO of a business which made a double-digit loss last year, I would not understand why I should pay three times for a desktop compared to retail cost of iPad!

To quickly summarise my argument - given these very influential forces that are shaping the world of business technology, and the fact that they are here and will be growing in their influence... and their strong commercial as well as functional advantages, how long before your conventional CIO function turns into an outdated, ineffective and irrelevant cost centre? If the trajectory of this evolution continues like this, will your organisation need a CIO by 2020?

This blog post appears in the ebook Management Skills in IT.

Comments (6)

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  • 1
    Jonathan Bishop FBCS CITP wrote on 18th Aug 2011

    My firm has the portfolio 'chief information officer' written into out Articles of Association. I hold that portfolio along with 'chief technology officer'.

    From our perspective the CIO is a 'knowledge manager' and not an IT person. So in our firm the CIO would be more likely to be Chartered by CILIP than by BCS, with the CTO being a member of the latter. I am already CITP and am working towards MCILIP.

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  • 2
    Steve Burrows (FBCS CITP FIoD CDir) wrote on 18th Aug 2011

    Interesting comment Jonathan. I would say that a primary responsibility of the CIO role is the manufacture of information and knowledge, not merely the management of it. How does CILIP address this? Within IT we clearly manufacture information, it is one of the primary purposes of IT, and from a strategic viewpoint the person who oversees that manufacturing doesn't need to be a technician, any more than the manufacturing manager in an engineering shop needs to be a lathe operator (although it often helps!). In that respect I cannot see how as a CIO that CITP would be inappropriate, unless one takes a purely (and very wrong) infrastructural approach to IT?

    More importantly, and I've replied to the post elsewhere, the author seems to be perpetuating the immature (and damaging) myth that the CIO role is about technology rather than information, confusing, as so many do, the respective roles of CIO and CTO. As your comment clearly illustrates, the CIO role is about information, not technology. Information is not going to go out of fashion, nor is valuable information going to be commoditised.

    Elsewhere http://www.linkedin.com/groupAnswers?viewQuestionAndAnswers=&discussionID=66178100&gid=122061&commentID=48661096&trk=view_disc the author has responded to me by saying "Yes I agree that CIO role needs to evolve beyond technology managing.", I would say that in many cases the CIO role has devolved to technology management from its true purpose of Information, in part due to aspirational IT managers and CTOs who think that being a CIO is about managing IT, instead of performing their corporate duty of supporting strategy through information.

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  • 3
    Jonathan Bishop FBCS CITP wrote on 18th Aug 2011

    Interesting points Steve. My firm’s articles specify these portfolios to be assigned to directors:
    (a) chief administrative officer;
    (b) chief assessment officer;
    (c) chief communications officer;
    (d) chief compliance officer;
    (e) chief executive officer;
    (f) chief diversity officer;
    (g) chief financial officer;
    (h) chief information officer;
    (i) chief legal officer;
    (j) chief marketing officer;
    (k) chief operating officer;
    (l) chief research officer;
    (m) chief technical officer;
    (n) chief technology officer;
    (o) chief verification officer;

    If you think about the way people see the role of CIO it is the combination of the roles; c, d, h, m, n - wouldn't you say? Whereas in my firm we keep the chief technology officers and technical officers separate. So while the first is responsible for keeping abreast with the best solutions in terms of Linux/Windows etc., the latter deals with issues like usability, and standards.
    By virtue of this you can see that the technical role can go well with compliance and legal. Whereas the technology role goes well with chief operations officer and marketing also.

    So, I guess you’re right, the CITP credits I got from my computer science MSc could go well with both, but maybe the CILIP credits I got from my MScEcon in information systems, would be more appropriate for the technical part?

    I think what everyone can agree on is that as the downturn means boards of directors are going to get much slimmer so these boards will have to be composed on the basis of the individual skills of directors, something which one might argue my firm is prepared for. Reshuffles may become as common in the board room as they are under Labour Governments! ;-)

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  • 4
    Steve Burrows wrote on 19th Aug 2011

    Hi Jonathan, I think CIO can include all the roles you've identified, and also (o). most boards would not have that diversity of roles, for instance i, j, and l wouldn't be represented. IIRC the average board is 7 members.

    CTO is quite commonly split from CIO in larger organisations, and would not be a board level function. Information is strategic, technology is tactical.

    The role of the board is direction, not execution (although some members may do both), so individual executive skills are less important than continuity of leadership & vision, which leads to stability in the boardroom within the constraints of good governance (which requires periodic refresh of members and ideas).

    My email is steve@sba.co.im. Offline I'd be fascinated to know what sort of organisation you work for, very few would specify such a broad range of exec portfolios at director level.

    Cheers, Steve

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  • 5
    Ryan Jones AMBCS wrote on 23rd Aug 2011

    Interesting article and comments. I sometimes think that as we become more professional, we often get hung up with titles and roles and loose sight of the deeper meaning of what we do as technology specialists. To me the article provokes some thought on the CIO & CTO titles that we IT professionals have come to hold so dear.

    The article identifies a number of trends that in the author's opinion are likely to redefine the IT landscape over the next few years. I am inclined to agree with him that these changes will alter the way organisations conceptualise, develop, deploy and use technology solutions; however this is nothing new in the world of IT.

    Compared to some of the more experienced BCS members who are likely to read this, I consider myself relatively green in the world of IT; having spent as much time in business functions as I have in IT roles throughout my career (I think of myself as a hybrid practitioner). It has been enough time however, to have seen the transition from mainframe based data centres to the evolution of concepts such as social media, CRM, ERP and e-commerce. Throughout this 'short' period, the titles CIO, CTO etc. have also emerged, as organisations began to understand the importance of IT to their strategic goals (and this has happened right alongside titles such as COO, CFO,CXO etc.).

    As the technology changes (which it has done rapidly from inception), so too will its use and so too will the titles of those entrusted with its care and development within organisations. So while I agree with the author in saying that these changes will alter the way IT is seen and used within organisations, I disagree with any suggestion that the role of an IT "Steward will disappear. (I deliberately omitted to use the titles CIO or CTO). What is more likely, is that the holders of these roles will need to retool and re-skill in order to make sense of and to fully capitalise on the emerging technologies in order to increase ROI for their organisation (not exactly a novel concept is it?). It is also likely that in this process they will be retitled as the organisations attempt to better define their changing roles.

    IT will continue to play a key role in organisations and the post highlights this fact. What will change, is the way that IT is packaged, used and managed. I believe that while the roles (and titles) may change, organisations will continue to need highly trained, experienced and competent professionals to plan and execute their technology mandates. These changes will also drive firms to think more on how to use IT in their business and less about how to develop and maintain it (This will mean a rethinking of core competencies for some companies - both the service users and providers).

    As for our beloved titles; consider the trending away from terms such as 'Information Technology' to ones such as 'Business Technology' and 'Management Information Systems', who knows - one of us might be applying to the role of CBO (Chief Business Officer), much sooner than any of us expect.

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  • 6
    Stephen Clothier MBCS CITP wrote on 30th Aug 2011

    In my business experience (Switzerland) the CIO will remain crucial, and remain at board level. His/her brief is to maximise the amount of knowledge available to the business at the right (and not the wrong) place, distilled from the "income of information" the company is generating. This knowledge is in effect part of the company's balance sheet. The CTO is less likely to be a board member and may be superfluous in situations where the IT provided by outsourced services. If so then the CIO is effectively the solution architect.

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About the author
Amitabh is a senior enterprise architecture practitioner who specialises in business and technology strategy definition, governance, architecture as well as methods and tools. He is an active industry networker, blogger, speaker and contributor to the advancement of enterprise architecture discipline. Currently he is the Chief Technology Officer in Fujitsu Services Private Sector Division.

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