IT Officers

During the dotcom days two to three years ago IT professionals were in great demand, with many taking on CTO and CIO positions as companies 'e-enabled' anything and everything. Then, for 18 months or so, things went very quiet for them as the pendulum swung the other way, shifting the focus 'back to basics,' with the emphasis on sales-generating positions rather than support functions like IT.

Over the last two months, however, Egon Zehnder International’s Singapore office has witnessed a renaissance in CIO and IT director roles, although this time the emphasis lies on business applications rather than building technical infrastructure. Increasingly, providing reliable and cost-efficient computing resources is a given. In fact, courtesy of outsourcing it has even become de rigueur to shift the responsibility for IT to a third party and manage it via service level agreements.

CIOs need business skills

Today, the value of IT operations is based on the function's ability to support the business per se. The people our clients want us to recruit are technically proficient individuals with strong influencing skills; people who can win the respect – and the ear – of corporate leaders. The key to success for today's IT executives is the ability to understand business priorities and then apply the technology required to attain those priorities. So today, IT management is all about combining technology and people skills, and the successful CIO or IT director will be first and foremost a consummate leader and only second a technologist.

Moreover, like other managers, IT executives should have a performance benchmark to aim for. Sales executives concentrate on revenue and margins, marketing executives on customer acquisition, and HR executives on employee satisfaction and number of staff recruited. IT should be no different.

Shifting the focus to the customer

Successful IT executives also need to focus on applications which add value for the customer. That could be CRM, which ensures that the customer doesn’t have to repeat information to multiple departments; network management to give the customer seamless access to an ASP's applications; or mobile security so that when visiting customers the sales force can provide relevant and up-to-date views on their accounts. The examples are endless, but the point is to concentrate on the benefits the technology can bring to the customer, rather than on the technical details.

In all of this, business skills are paramount. IT managers must understand how their company acquires and retains customers in order to make money, otherwise they won't understand how IT fits into the big picture. Having this context will prompt them to make the best IT investment decisions as they will be looking at business metrics like ROI. Additionally, if they don’t have the business fluency to sell their ideas to top management, their projects won't be funded.

Communication skills are also crucial to keeping IT firmly in the information loop. IT managers can’t expect the business people at the company to proactively coach them on what they want and need. It takes good questioning and listening skills to extract that information.

Furthermore, IT professionals must be result oriented and keep in mind that every dollar invested could also be spent on something else; spending $3,000 on a PC or $500,000 on an ERP system reduces the budget in another part of the company. IT people must stop thinking like a cost center, because the justification model looks at ROI, not cost recovery. If an IT manager can show that a $500,000 ERP system reduces the monthly financial close from 3 weeks to 3 days, he/she can also show the benefits in personnel costs, financial management focus (spending time on sales finance rather than accounting), and greater flexibility for management to forecast quarter-end results, making them more credible in front of analysts. This kind of argument will make sure management is sold on the system.

Job options for CIOs

The lines between the roles of IT directors, CFOs, COOs and CEOs are becoming blurred, but only to a certain extent. While all CXOs require business acumen and functional skills, the traditional silo experience of most staff CXOs means that CIOs, CMOs and CFOs rarely make CEO. Line CXOs from sales and operations with their experience of P&L responsibility, by contrast, are more likely to be considered for CEO positions.

IT professionals seldom switch to jobs in other fields, such as human resources, legal affairs or finance. That said, some do take on CTO roles at companies where IT is an enabling platform, such as ASPs. Others opt for technical pre- or post-sales roles which require their domain expertise. CTO roles for IT-enabled companies require a strong IT background, because if the IT system goes down, so does the business. So it makes sense for an IT Director or CIO to make the transition to CTO.

Companies selling data center offerings (IBM, HP, Sun, Unisys, NCR, etc), call in former IT Directors and CIOs when they need credible people at their side to help them convince customers. In many cases, an ex-CIO selling to a CIO is the ideal situation. Who better to empathize with the customer than someone who used to be in the same situation!