CIO or CTO

I recently had a very interesting discussion about the role of IT management. It is the current best practice to define the role of the CIO as a change agent within the organisation. He/she needs to help the organisation to use information, particularly performance information, to gain competitive advantage by leveraging the information asset to improve decison making at all levels in the organisation, from the strategic level right down to all operational levels of the organisation. This is partly about technology, but much more about organisational change -- about governance and about enabling new business models.

Traditionally, a CTO's focus is much more narrow, and focused exclusively on technology. How do I optimise the technology we own? How do I drive cost out of our technology platform? What hardware and networks do we have? Who should be our strategic suppliers of technology? How do I improve the reliability of our technology?

However, I am not sure if I think this is the right way forward. In my opinion CIOs would do good to become more of a CTO for the coming years. Here's why:

• Consumerization of IT. The colleagues in the business may know more about IT than you and have very sophisticated requirements. If they talk about making mash-ups and you think it involves gravy and potatoes, you will have a credibility problem. If the IT dept and the CIO are not IT savvy, the business will not only go outside and buy solutions, but they will create their own solutions. I would want my CIO not the best business person, but the best IT guy, just as I would want my CMO to be a marketing expert.
• IT is increasingly about value chain integration. Connecting processes, systems, people across suppliers, customers, employees, everyone. Much of the IT budget will be spent outside the organization; more than 50% will be no exception. This requires a strong infrastructure focus for the CIO, to manage the common foundation. For the future, applications will increasingly leave the IT realm; 2.0 techniques plus service-oriented architectures create business process frameworks, in which power users largely implement and maintain applications themselves.
• Most new business models are IT-driven anyway. Allowing consumers to configure their own orders (mass customization) and track the progress requires advanced web-based applications. Smarter analysis of customer data is achieved through advanced CRM analytics. Many new services are about supplying additional information to consumers; in other words, business intelligence becomes a product and value proposition of its own.

In all these trends the CIO has the largest business impact, being a techie!

--frank