I interviewed Bob Miano, president and CEO of Harvey Nash USA, today about its annual CIO survey. I'll post that interview probably next week. But I asked him about the Wall Street Journal article I wrote about on Tuesday suggesting that major security breaches will raise CIOs' stature within the organization.
According to that article, less than half of CIOs report to the CEO. In the Harvey Nash survey of more than 2,000 respondents, 32 percent globally said they report to the CEO. In the United States, it's 28 percent, but up from 15 percent in 2009. Half of the respondents said they sit on the operational board or executive management team and 69 percent report having more strategic responsibility, an increase of 8 percentage points from last year's survey.
Miano said that risk is certainly a factor in the rise of CIOs' influence, but he sees innovation as a bigger factor. He told me:
When it comes to the application of technology, some CEOs are visionaries. They see technology coming to their doorstep in things like social media. ... These CEOs see technology moving the ball forward and that they have to get on the bandwagon with things like mobile, wireless, social media. They're pushing that agenda, so they want a closer relationship [with the CIO.]
That was the point of a rant by Forrester analyst Nigel Fenwick, who points out that people have been saying the CIO should report to the CEO since the '80s. As to why that hasn't happened, he attributes half the fault to CEOs who just don't get it. After all, they decide which roles have the strategic importance to be direct reports. He writes:
This decision isn't based on the performance of the incumbents (or the new team they will hire)-instead it's based on their preconceptions of what they should focus their attention on. So if the CIO isn't on the executive team, it's because the CEO doesn't see technology as important enough for the success of the company. And in today's digital economy, any board of directors that hires a CEO with such backward thinking should be fired by the shareholders (my opinion and not Forrester's).
I was fortunate enough to work with three CEOs who could see the potential for technology to be used as a competitive weapon. But then came the fourth CEO. His approach was that IT was "data processing," and the role of the "IT manager" was to keep the costs down; his approach was to change the reporting line and have IT report into the CFO. He clearly had his preconceptions, and I had a choice to make: accept his narrow vision and spend energy on convincing him he was wrong, or move on-I chose to move on. This is a choice every incumbent CIO must make upon the arrival of a new CEO. If the CEO doesn't get it, I think it's time for a good CIO to move on.
The problem with that, he says, is that bad CIOs tend to stay, which reinforces those CEOs' perception about IT. When I interviewed Krishnan Chatterjee, chief marketing officer for offshore IT and software development company HCL back in January, he told me that business types tend to push back against a larger role for IT unless they first see the benefits. In one example, he told me:
Suddenly the larger employee community has been exposed to the kind of stuff IT is doing and they're finding it far easier to get funding as well as buy-in from the business-funding to modernize those legacy apps and buy-in on those suggestions they're bringing in on how mobility can impact their business. But in the absence of doing something as a catalyst, the reaction from business is not good.
But with technology becoming ever more important to business, Chatterjee told me that his company predicts that future CEOs will come from the CIO ranks.