The obsolete CIO will emerge in 2012 as more organizations realize they no longer need a CIO due to changes in their business and technology. The obsolete CIO exists in one of two forms:
- The individual, the person, is an obsolete CIO as a result of not keeping pace with the profession and the changing role of the CIO as business strategist.
- The role of the CIO has become unnecessary in an organization as a result of changing business needs and technology portfolios thereby creating an obsolete CIO position.
The dynamics of the second form are the focus of this post. I do want to note the fears of becoming an obsolete CIO are real for a large number of CIO’s who fear being fired any day now.
The Obsolete CIO
I believe it is obvious that not every organizations needs to have a CIO. This should be obvious since the majority of organizations, when you consider them in the aggregate, do not have CIO’s. In fact I suppose a substantial portion of the SMB’s, non-profits and others don’t even have an IT department and instead do just fine with support from their vendors. Another interesting thing we see occurring now is that as more people move into senior roles who are technology savvy, and as technology has become more accessible, the need for in-house CIO expertise is declining.
I am not alone in my position. There are several well reasoned positions, including that of Marc Schiller, on why organizations should demote their CIO. Schiller’s perspective is rational and large numbers of organizations rely on a Director of IT to fill the senior IT role. I have also found a few stronger positions on this issue including calls to Fire Your CIO where the argument centers on if the senior IT leader role is really a C-level role or not.
Do We Need A CIO?
Scale: The larger the scale of the inventory or geography of the environment the more likely it is you might need a CIO. However, scale does not usually require significant business acumen nor executive leadership in strategy or execution until you get into the top 5% or so of big organizations. Scale should be the least of the reasons to have a CIO since there are many other ways to deal with issues of scale.
Technology: The more complex the technology and architectures the more likely you are to need a CIO. However, the degree of complexity should not be a significant factor in deciding if you need a CIO or not given the options for outsourcing and cloud services.
Environment: Organizations with very active project portfolios and high rates of change in products, business process, or applications and systems are much more likely to need a CIO than those with more static environments.
Strategic: The degree to which IT is strategic to the business mirrors the importance of having a CIO who can deliver the executive leadership needed on strategy. If Strategic is not comfortable for you might prefer to think of this key factor as whether or not IT services are customer facing or simply back office. That is why I have used percentage of revenue here because it cuts through the terminology fog. So the higher the percentage of revenue generated through a technology solution the more likely you need a CIO.
Pulling it all together to decide if you need a CIO or not, consider the evolution of technology is one towards commodities and outside IT service companies including cloud. Consider if your functional managers and executive team are accustomed to technology infused business and can make sound decisions without a CIO. Consider if a flatter IT organization, perhaps with an additional director or IT procurement manager would be sufficient.
Finally, although your organization’s scale and degree of complexity are factors, they can be addressed as noted above without a CIO. But if you have a more dynamic business driving revenue through IT systems but where your product managers and CTO are already overloaded you probably need a CIO – at least for a little while longer.