(Photo: Ruthson Zimmerman for Unsplash)
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A text by Olivier Garant, M. Sc. Student Digital transformation of organizations, HEC Montréal
« The CIO’s ability to add value is the biggest single factor in determining whether the organization views IT as an asset or a liability», selon Earl, M.J. and D.F. Feeny dans Is your CIO adding value?
What differentiates digital transformation leaders from others is a clear formulation of the digital strategy combined with leadership and a corporate culture ready to ensure this transformation. The choice of a digital strategy has a huge impact on the organization, especially in terms of its performance. The role of powerful technology leadership is associated with improving sustainable business performance and implementing digital strategies that requires companies to incorporate this strategy into all decision making.
However, studies have shown that Chief Information Officers (CIOs) are rarely granted the same leadership authority as other members of senior management in companies and that there seems to be a gap between the growing importance of technology. and the strategic leadership role of “CIOs” in organizations. This essay will then explain what are the perceptions and characteristics of a “CIO” and how they generate value for the company.
First of all, the term “CIO” refers to the top executive and IT leader for a company and he is responsible for managing the technology function by overseeing the company’s information resources, creating a vision of the role of technologies, in redefining and influencing company strategy, and ultimately in generating business value. Several stereotypes are associated with the title of “CIO” and these affect their perception in business and in the markets, which testifies to a bias in the selection and credibility of their “strategic” role in business. CIOs are seen more as transformational leaders (system and architecture implementation) and functional leaders (providing expense management, security, IT crisis management) rather than strategy-driven leaders who receive more respect and is more likely to have access to the resources they need.
The perception of the “CIO” competent and innovative, but also very detail-oriented and task-oriented and therefore less adept at providing strategic direction with poor communication and leadership skills is widespread in our societies. These stereotypes of the “CIO” explain the fact that we do not associate the “CIO” with the stereotypes of a leader (charisma, dedication, strategic vision and skillful communicator). It has been shown that the attitude of the Chief Executive Officer (CEO) towards technology can influence the strategic direction of the organization and also foster the leadership role of the CIO. The “CEO” has an important role in order to make the “CIO” a real member of the general management to deconstruct negative stereotypes towards the role of “CIO”. The attitudes of the “CEO” towards information technology (IT) and the personal profile of the “CIO” affirm the relationship between these two roles within the attributes of the company.
(Source: Feeny, D.F., B.R. Edwards, and K.M. Simpson, Understanding the CEO/CIO Relationship. MIS Quarterly, 1992. 16(4): p. 435-448)
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Briefly, the qualities of a “CIO” should correspond to a mixture of leadership, creativity, evaluation and implementation with a global understanding of the interrelationships between the various functions and the business units of the company.
With the lack of a clear role definition and objective performance measures to examine the value of IT, executives are left with their perceptions to assess the role of the “CIO” and IT impacts. This therefore results in a tendency to have a feeling of inferiority or irrelevance which is felt by IT departments vis-à-vis “ancestral” disciplines such as marketing, accounting, operations and finance. . In fact, this could be explained by the difficulty of formally seeing the value of the money that goes into IT within the company since this department uses a lot of resources, but the value is hardly perceived for the vast majority of the company. company.
Yet companies with powerful technological leaders achieve higher and sustained production over time than companies that do not have higher levels of innovation. In addition, IT leaders help the management team to better adapt to market changes created by technological advancements, thus leading to higher levels of production in order to exercise a competitive advantage in the market. This increase in production has been shown to be more likely with the inclusion of an IT leader than a marketing leader. In contrast, other researchers find that marketing provides better business performance than research and development (R&D) or operations. However, there must be a balance in leadership teams in order to enable successful team processes. The “CIOs” should then, contribute to the reflections and the commercial operations, be included very early in the debates which are related to the change and thus ensure to do the right thing and not only the things in the right way.
In short, the power and influence of managers directly affect the performance of companies. There seems to be a mismatch between the growing importance of technology and the strategic leadership role that “CIOs” should represent. This is why, in order to maximize the competitive advantage, the negative stereotypical representation of “CIOs” which leads to erroneous reasoning must be changed in order to have a better link between the perceived image and the real qualities of a ” CIO ”.
References
1. Earl, M.J. and D.F. Feeny, IS YOUR CIO ADDING VALUE? Sloan Management Review, 1994. 35(3): p. 11.
2. Gerald C. K, et al., Strategy, not Technology, Drives Digital Transformation. MIT Sloan Management Review and Deloitte University Press, 2015: p. 1-25.
3. Mithas, S., A. Tafti, and W. Mitchell, HOW A FIRM’S COMPETITIVE ENVIRONMENT AND DIGITAL STRATEGIC POSTURE INFLUENCE DIGITAL BUSINESS STRATEGY1. MIS Quarterly, 2013. 37 : p. 511-536.
4. Taylor, J. and J. Vithayathil, Who delivers the bigger bang for the buck: CMO or CIO? The Journal of Strategic Information Systems, 2018. 27(3): p. 207-220.
5. Gonzalez, P.A., L. Ashworth, and J. McKeen, The CIO stereotype: Content, bias, and impact. The Journal of Strategic Information Systems, 2019. 28(1): p. 83-99.
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