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Project CIO II: Office of the CIO
New Roles for New Business Value
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The Office of the CIO is responsible for far more than providing a standard set of services to an unchanging set of customers in the business. Rather, it's engaged in a continual dance with the rest of the corporation, with different close partners at different times. IT provides the common business infrastructure and a reliable set of business services, but at the margin it has a widely varying and evolving set of business responsibilities. The CIO and IT organization are, at the request or charter of the CEO, "breaking out of the IT bunker," expanding far beyond traditional technology management roles, and adding new and greater business value.
Beyond the ongoing demand for efficient and effective IT services, four drivers are shaping the work of IT in major corporations today:
- Growth and innovation agenda. Major corporations today are focused on growth, both organic and via acquisition, and on innovation as a driver of growth. Business executives know that information technology is a significant lever - in some industries the most significant lever - in accelerating business innovation and growth.
- Demand for horizontal integration. Large corporations are inherently complex, with markets changing fast, operations and competition globalizing, and relationships with customers and suppliers becoming more intricately networked. It's a continuing challenge to improve their levels of horizontal integration, of making the parts work together efficiently and effectively.
- Changing workforce demographics. Demographic patterns indicate - indeed, guarantee - that the supply of skilled workers, including IT staff, in the United States and the industrialized world is not going to keep up with expanding demand. Many IT organizations are facing a retirement wave of key people, especially in project and relationship management roles.
- Expanding technology supply. Fortunately, other forms of supply are expanding fast - the capability of technology and the availability of technology services. Today a corporation can rent pretty much anything it needs on the IT services market - except the local knowledge and experience in how to deploy technology in the business.
To respond to these drivers, the CIO and IT organization should take three key actions:
- Form a Distributed Innovation Group. Innovation today is an inherently distributed activity, and IT must participate in the process of innovation across the enterprise.
- Form an Enterprise Initiatives Group. With horizontal integration a driver of business performance and such a big part of IT work, the IT organization should have a permanent unit devoted to it.
- Maximize the leverage of outside services. In order to focus key IT staff on business integration, innovation, and growth, as well as to compensate for shortages of skilled staff, corporations must rely more than ever before on external IT services.
This Re.sults® report is addressed to CIOs whose IT organizations are already high performing, are well along in their organizational evolution, and have close working relationships with their businesses. It describes the conditions and "table stakes" that must be in place before a CIO and IT organization can significantly expand their business roles. It also details the four powerful business forces reshaping the work of IT from both the demand and supply sides, explains our major recommendations, and presents a basic structure for the Office of the CIO.
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