How to Empower CIOs to Survive (and Thrive) in the AI Era

Aug 21, 2024 | Leadership Effectiveness

My latest article, kindly edited and published by Heller Search Associates, presents the case for a radical rethink in attitudes towards the CIOs role

Those betting on increasing levels of digital maturity to achieve sustained competitive advantage need to stop treating their CIOs as disposal commodities and start to nurture them as the critical resources they need. Where to start? I suggest a rethink in current approaches to how exec teams define the CIOs role, assess the ‘performance’ of individuals in the role and establish learning environments that help CIOs remain abreast of the latest development s in technology and practice.

Setting CIOs up for success requires a radical rethinking of leadership paradigms

Companies seeking sustained competitive advantage are increasingly reliant on rapidly evolving digital technologies. Emerging capabilities, derived from the combined use of cloud technologies and artificial intelligence (AI), now enable organizations to monitor, interpret, and act on market and operational changes faster than ever before; lead times between ‘sense’ and ‘respond’ shorten every day. No one understands this better than the executive charged with securing and exploiting these new technologies — the CIO.

There’s one big problem, though: many senior leadership teams at companies that are pursuing radical and ongoing digital change don’t really know what they want from their CIOs. They often lack a clear definition for the CIO role. They struggle to effectively assess their CIOs. And there’s precious little understanding of how CIOs should develop in their roles.

This cumulative lack of clarity — and the firing and defection of CIOs that can result — can lead to delays to the realization of business value from emerging technologies. It’s more important than ever that businesses retain their CIOs to keep pace in increasingly dynamic, digitally maturing environments. But that demands rethinking some old ideas about IT leadership and how best to set CIOs up for success.

The Problem with Outmoded Leadership Frameworks

Before we can determine where we need to go, it’s important to understand how we got here.

Historically, much of the research into IT leadership has been generalized from theories developed for business leadership. And there are three underlying assumptions ever present in such research: that leadership can be defined, that a leader’s performance can be usefully assessed, and that individuals can become better leaders.

CIO researchers have tried to develop a unifying framework for CIO leadership. However, the assumptions above don’t make as much sense for the modern CIO as expectations for the role continually change.

A commonly agreed-upon definition of the CIO role remains elusive for several reasons. First, the role has expanded exponentially. While some describe this as an evolution from technology manager to business leader, that’s an oversimplification. In reality, IT stakeholder demands have grown so much that today’s CIOs must serve as managers and leaders in a number of different capacities. Secondly, any definition for an individual’s CIO role is unique and contingent on multiple combinations of factors, including market forces impacting IT investment decisions, organizational constraints (based on geography, industry, legal, or regulatory requirements), how the existing IT environment helps or hinders the CIO’s ambitions, and organizational attitudes towards IT (e.g., whether stakeholders perceive IT as a cost center or strategic enabler). Third, it can be tricky to define the CIO role when stakeholders disagree on the purpose of the position — whether it is to contribute to business strategy and maintain alignment between IT and business strategy, to pursue technology innovation or to deliver operational excellence while controlling costs. Finally, there can be disagreement on the role profile which tends to be based on the IT leader’s previous experiences or perceived status within the organization.

Compounding these attempts to define the role, CIOs are now subject to an expectation explosion. IT executives in digitally maturing environments face rapidly changing, sometimes conflicting expectations from internal business customers and leaders, third party service providers, and end customers. CIOs are expected to seamlessly switch between multiple leadership roles and become increasingly ambidextrous in their attempts to address each set of expectations.

Assessing the CIO role is equally challenging. Organizations remain obsessed with assuming direct, causal links between individual CIOs and measurable firm level performance (e.g., revenues, costs, profitability) and/or highly subjective measures of CIO success such as business-IT alignment and value creation.

On the surface, it appears to make sense to measure CIO performance based on a mix of tangible and intangible metrics. However, holding individual CIOs solely responsible for higher orders of measurable performance and/or organizational outcomes completely ignores the relevance of many other factors that also impact such metrics.

Then there is CIO development. Standardized programs for professional development no longer apply to CIOs inhabiting this unique role. Even if CIOs can identify development opportunities for themselves, they still face hurdles. In the absence of agreed-upon professional standards and frameworks, CIOs will struggle to justify investing in their own development. In addition, senior leadership teams tend to assume that their CIOs should already possess the necessary leadership attributes. What’s more, CIOs are notoriously time-poor. And even those that do secure the time and support for development may find themselves unable to implement their newly gained capabilities due to organizational intransigence.

How to Set CIOs Up for Success

To help CIOs cope in these increasingly fast-moving and uncertain times, companies and their senior leadership teams need to rethink their approaches. The goal must be to better equip and motivate their CIOs to thrive in today’s dynamic business environment through a process of continual development and reinvention.

Doing so requires a paradigm shift in each of the areas described above.

  1. Defining the CIO’s role. The time has come to accept the chaotic nature of the technology and business environment and enable a more fluid definition of an IT leader’s role. Senior leadership teams should agree on an initial baseline of expectations for the role, in terms of both purpose and profile. Then, they need to establish a means to formally capture, assess, and communicate changes in those expectations on a regular basis
  2. Assessing CIOs. It’s essential to move away from use of performance metrics and instead focus on how well CIOs are perceived to manage the rapidly changing expectations of their stakeholders. Effective CIOs will be those who successfully navigate continual realignments in expectations
  3. Developing CIOs. Historically, companies have focused more on their CIOs’ knowledge application, but they should now ensure that knowledge application is complemented with ongoing knowledge acquisition. Senior leadership teams should therefore make provisions for CIOs to learn on the job. This requires creating an environment in which CIOs can experiment with new and existing skills as they seek to manage the changing the expectations of their stakeholders.

In this rapidly changing AI era, organizations need to stop treating CIOs as disposal commodities and start to nurture them as the critical resources they need.

Article edited by: Kelly Sutherland, Heller Search Associates

Image Credit: TheMetalMann, Pixabay, ‘outdoor-3681924_1280’

 

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