Last week, in a post titled, “An Inside Look at One CEO’s Working Relationship with His CIO,” I wrote about how Paul Lidsky, president and CEO of Datalink, a cloud services provider in Eden Prairie, Minn., described his working relationship with Dave Brady, the CIO. It was an interesting conversation, in that Lidsky characterized the relationship as especially close, even though Brady reports to the CFO, rather than to him. After speaking with Lidsky, I wondered what Brady’s perspective is on how well that works.
I got my answer in a separate conversation directly with Brady. Bottom line: From Brady’s perspective, it works just fine. I found his explanation of why and how it works to be an extraordinarily informative one.
I asked Brady what, in his view, determines whether the CIO should report to the CEO, or to the CFO or some other executive. He said his approach is to consider who IT’s customer is:
My approach to what IT does is, we’re a service provider to the business. When I came onboard here [in March 2013], we had a lot of discussions about where IT should report to, and historically, it had reported to the CFO, and it had been very hierarchical. I had conversations at the time with four senior executive leaders. There was Paul, the CEO—his motivation is to drive the strategy forward. He’s looking at the multi-year strategy, and he’s very strategically oriented. I had Shawn O’Grady, the EVP and COO of the company, who’s responsible for delivering on the current year plan. He’s got everything that’s go-to-market—sales, the services we sell, he’s got all of that stuff. So he’s very focused on the tactical—the immediate, “Let’s achieve the business plan for this year.” Paul’s still interested in that, but Shawn’s job is to get that done. Then there’s the CFO, Greg [Barnum], and his job is to make sure we’ve got the financial capability to achieve our business objectives and goals; and since we’re a public company, to make sure we’ve got all the right internal controls in place, that we’re managing our business and reporting all of our numbers appropriately. And he’s also responsible for helping us, from a financial standpoint, create the investment capability so we can grow, and take the business plan where it needs to go. And then there’s the HR component [led by Patricia Hamm, EVP of Human Resources], which is responsible for the people side of our business, the culture, the collaboration. Those are four diametrically opposed positions. If I put them all in a room and asked what we should be focused on right now, I’m going to get a different answer from each one of them. So what I came to agreement on with that group was, I take my direction—I set my agendas and priorities—from a council of those four. I negotiated this when I first came on board—I will take my directions from and report to the executive leadership team, as a governing body. Yeah, I have my CFO who gives me my annual review, but other than that, I do all of my interaction with and take direction from the four of them as a group. And actually, that’s worked very effectively. I’m getting direction to work on the right things at the right times, knowing that there will be a balance between strategy, business goals, financial goals, and people goals. We’re weighing all of those against each other, to arrive at the direction we want to move in. That’s worked very effectively—I’ve been pretty pleased with that.
I asked Brady if he feels he has a full voice, and the seat at the table that he needs to have as a CIO, or if that’s more of a work in progress. He said he came in the door with a seat at the table:
Because we’ve been able to effectively deliver in the year-and-a-half that I’ve been here, I’ve maintained that seat at the table. I think we probably have more credibility today than we had when I walked in the door. Having that seat at the table is an absolute must for any IT leader. Without having that seat at the table, strategically, it’s very difficult for IT to be impactful for the business. And if it’s not, the business will suffer. If he or she doesn’t have that seat at the table, I think it’s incumbent upon the CIO to figure out how to get there. And getting there isn’t a technical conversation—that’s a business conversation, a business relationship.
I mentioned to Brady I had noticed that the page on Datalink’s website that lists the company executives lists the four top executives he had mentioned that make up that “council,” but not him. I added that I had also noticed that on the Wall Street Journal’s company page on Datalink, which lists “all executives,” he’s not included on that list, either. That one includes the SVP of marketing, the chief accounting officer, and the head of investor relations, for example, but still no CIO. I told Brady I pointed that out, because I found it very consistent with what I’ve seen in other companies over the years, where the CIO seems to be the “forgotten stepchild” of the executive team. I asked Brady for his thoughts on that, and this was his response:
I think in companies where IT is not seen as driving value, that’s a very true statement, that they would be the forgotten stepchild. That’s where it’s seen as more of a liability, and a ball-and-chain on the bottom line. I don’t know if you necessarily have to be visible as a corporate officer, or a Section 16 officer or anything like that to deliver value to the business. But within the company, you’ve got to be seen as a peer and a partner of those who are at that level. So when I’m talking with the COO or the CFO, or even with Paul [the CEO], those conversations, and the mood that’s in the room at that time, we’re a group of equals sitting at the table, talking about how we drive this business, and how we do things better. What’s the right thing to be doing right now? It’s discussing threats, risks, all of those kinds of things. It’s in the relationships. I think a lot of IT executives get hung up on their status, and where they fall in [the hierarchy]. I think that matters less; I think it’s more about how that IT leader is wired to just step into the role and start acting and behaving that way.
Brady also had a lot to say about the changing role of the CIO. I’ll cover that in a forthcoming post.
A contributing writer on IT management and career topics with IT Business Edge since 2009, Don Tennant began his technology journalism career in 1990 in Hong Kong, where he served as editor of the Hong Kong edition of Computerworld. After returning to the U.S. in 2000, he became Editor in Chief of the U.S. edition of Computerworld, and later assumed the editorial directorship of Computerworld and InfoWorld. Don was presented with the 2007 Timothy White Award for Editorial Integrity by American Business Media, and he is a recipient of the Jesse H. Neal National Business Journalism Award for editorial excellence in news coverage. Follow him on Twitter @dontennant.