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State of the CIO 2014: The Great Schism

Kim S. Nash | Jan. 3, 2014
Digital strategist or traditional CIO? Our 13th annual State of the CIO research reveals the great career divide.

"There is a polarization to what's happening," says Rich Adduci, CIO of Boston Scientific, a $7.2 billion medical device maker.

This fracturing threatens the vitality of the CIO role. The divide is not due only to seemingly less capable CIOs; both the executive and the company play a part. In times of tumult—and the current dismantling and remaking of whole industries certainly qualifies—leaders often don't know quite what they want. A strategic CIO and an organization that views IT as simply a cost to be managed are as badly mismatched as a tactical CIO trying to keep up at a place that demands fresh thinking from IT. As Adduci puts it, "Either the CIO will win people over, either way, or he will get gone."

We see the angst. While 86 percent of CIOs in our survey say their role is becoming more important to business and 90 percent say being a CIO is increasingly challenging, just 65 percent say the CIO role is becoming more rewarding. And a worrisome 28 percent of respondents say they feel CIOs are being sidelined (see "Slip Slidin' Away?" above).

The question is, what can we learn from top CIOs who are flourishing in the new digital age?

Keys to the Castle
When you talk to leading CIOs about how they think and what they do, two major themes emerge: compensation and customers. Sixty-one percent of CIOs in our survey have part of their compensation tied to a specific corporate revenue or profit goal. These CIOs also report having far different priorities and expectations than the 38 percent of CIOs whose pay is not tied to financial performance. Those priorities and expectations fall into the category of strategic, outward-facing items, such as improving products and services, addressing increasing competition and enabling growth in emerging markets. In other words, the sort of endeavors discussed in private meetings of the board of directors.

Properly motivating CIOs, and all of IT, to get the most valuable performance out of them is a no-brainer for Chris Hjelm, CIO of Kroger, a $96.8 billion grocery chain. He and nearly every employee at Kroger earns bonuses based on the company's financial results. In fact, Hjelm's entire bonus depends on achieving such objectives. Doing so ensures everyone is working toward the same goal, he says.

And that goal, of course, is serving the customer.

While customer focus is a high priority, nearly half of the CIOs in our survey—47 percent—have difficulty getting their IT staff to be more business-oriented and customer-facing. This figure climbs to 50 percent for respondents outside North America, significantly higher than the 42 percent for North American respondents. CIOs who can't drag technical staff into this new world sometimes just have to replace them.

 

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