CIOs Are the C-Suite’s Indispensable Instruments of Change

Written by Salesforce. Market disruption is accentuating the essential role CIOs can play in helping their organization manage through new market demands, priorities, and business models.

“Opportunity is always coming, but never knocks on the door. You have to get up and meet him.”
–Bangambiki Habyarimana, The Great Pearl of Wisdom.


CIOs tell us that opportunity is knocking in the form of digital transformation and the resulting Customer Revolution. What will it take for you to open the door to the opportunity it represents for your career in terms of leaving a legacy or becoming a CEO?

What we’re learning from CIOs is that the digital transformation and the Customer Revolution are accentuating the essential role they can play in helping their organization manage through new market demands, shifting priorities, and emerging business models.

But with so much in flux—customer expectations, technology advancements, shifting go-to-market strategies—knowing where to focus their energies to evolve with market changes can be difficult. CIOs tell us they are torn between competing priorities, such as responding to disruptive forces and new business models while ensuring that their department continues to innovate, meets its users’ day-to-day requirements, and balances competing legacy and SaaS requirements. These executives also are challenged with balancing innovation, bimodal operations, and emerging business models on a budget. Further, they’re tasked with such imperatives as intensifying their use of analytics, transforming KPIs to align with new business models and expectations, and getting more ROI from technology, data, and their teams. In-depth interviews we recently conducted reveal that many CIOs are facing the same issues and see their peers as a support group and great source of insights.

That’s why we’re sharing this private benchmarking study with you. Salesforce wants to help fuel this peer-to-peer collaboration, and enable you become a trailblazer on your path to achieving your business goals. Our research comprises in-depth interviews with more than 40 senior decision makers to discuss the approaches these leaders are taking to transform themselves as they manage through the changes around them. Interviewees represent four roles—CIO, CMO, VP of Sales, and VP of Service—and a variety of industries, including entertainment, financial services, hospitality, information services, insurance, manufacturing, retail, shipping, technology hardware and software, and travel. These leaders shared their concerns, as well as such issues as their shifting goals and priorities, success measures, and staffing challenges.

Several common themes emerged—not only within roles, but also across them. The biggest challenges across roles include competing based on customer experience, unleashing the power of data and insights, empowering employees, and outmaneuvering the disruption brought on by new business models. In addition to these topics, several issues and opportunities emerged unique to executives in the CIO role. Common themes include balancing speed, operational effectiveness, and security while trying to innovate quickly enough to keep pace with market demands; retaining enough budget for innovation while spending on existing legacy and new SaaS systems that are running concurrently; and better aligning their department’s operations and priorities with their organization’s overarching goals and needs.

Consistent Themes Across Roles

You may sometimes feel alone, mired in today’s quicksand-like challenges. But you’re not alone. Interviews with more than 40 executives in CIOs, CMOs, VPs of Sales, and VPs of Service roles revealed several common challenges across roles. Those issues include ensuring technology ROI through adoption, unleashing the power of analytics, combating legacy thinking, and responding to the need for speed and collaboration to stay competitive. The interviews also uncovered approaches your peers are taking that you can adopt to manage through these changes and challenges.

Translate customer experience promises into business results: Nearly every executive interviewed cites customer experience (CX) as a top priority. Yet, the maturity of their CX initiatives varies widely in terms of strategy, accountability, and results. The interviews also revealed that some leaders consider it their responsibility to be CX designers; others note the importance of employee engagement in providing an outstanding customer experience. Most agree that data quality and management are foundational building blocks to deliver on the CX promise.

Adoption is the new ROI: The return on the investment of a technology platform or application is only as good as an organization’s adoption and use of it. Adoption is the link between the cost of the technology and it’s true value; it’s about short-term financial impact, as well as long-term business impact. As a result, senior executives are now expected to drive broad behavior change and technology adoption, so their teams and the organization at large can realize ROI benefits from their technology investments. These new responsibilities require skill sets new to some leaders, especially many CMOs.

The flip side of this issue is ease of use. Ease of use helps to ensure the effective adoption of a technology—which further increases its ROI. Executives we interviewed involve users in the purchase process to test usability when considering new technologies.

Unleash the power of data and analytics: Data management is no longer something “only IT will worry about.” All the leaders surveyed are concerned about data: from data collection, quality, and storage, to its organization, interpretation, and security. Migrating from siloed, legacy data models to a 360-degree view of customers and financials is difficult, but is also a business imperative in the age of the customer. Additionally, executives in all roles cite the importance of analytics to their decision-making. From predictive analytics to pipeline forecasting, using data to inform strategic and tactical decisions is fast becoming table stakes.

Obsess over leaving a legacy: All of the senior executives interviewed share a passion for developing organizational trailblazers, empowering key deputies, and adopting new business models that will leave a lasting legacy on their respective organizations. This was consistent whether their business is in growth, transformation, or maturity state. One way they plan to leave a legacy is by building up their organization to be a model for the rest of their industry. Another is by implementing technology solutions that will make the greatest organization-wide and long-term impact, as well as be a building block to future success.

Enable employees to own the customer experience: Senior executives point out the need to train their staff to think like managers.The training is primarily focused on how to better manage customer experiences and expectations—primarily external customers, but internal stakeholders, as well. It’s about pushing decision-making as close to the customer as possible. If CX is a priority, then businesses need to give their frontline employees the knowledge to translate any differences between customer expectations and the company’s ability to deliver on them, as well as the power and authority to take any necessary actions. Other reasons for this focus on training include ensuring engagement and retention, supporting career growth, and better aligning with customer experience mandates.

Elevate enterprise architects: The enterprise architect role historically was buried deep within the IT organization. Due to the demands of data management, integration, and customer experience, this role is now elevated in many organizations to a CIO direct report, and is becoming a must-have in other areas. For example, some CMOs are hiring a marketing architect to help manage the growing complexity of the marketing technology stack. Not surprisingly, the enterprise architect—whether in IT or another department—is gaining prominence as an influencer in key technology purchase decisions.

Combat legacy attitudes: The progress-stalling attitude of “But we’ve always done it this way” from peers and subordinates—and sometimes the industry at large—keeps some leaders stuck in the past. For example, CMOs and VPs of Service often hear that salespeople know the customer best; this is especially common in industries that use agents, such as insurance. Because peer relationships and empowered subordinates are so important to success today, these attitudes can be as troublesome as legacy systems. This outdated thinking can block the swift progress needed to respond quickly to disruptive market forces.

Outmaneuver disruption: Disruptive forces are spurring business leaders to aggressively build agility into their operations. The primary disruptive force in B2B is the Salesforce Effect[1] and in B2C is the Amazon Effect[2]. The Salesforce business model is creating disruption across multiple B2B industries, changing the way buyers want to purchase and to pay. For some B2B leaders, the pains of crossing over to a subscription model are evident. In the case of B2C leaders, mitigating the Amazon Effect is a priority. As Amazon displaces numerous traditional distribution routes, many B2C companies are torn between relationship loyalty and reach, scale, and profitability.  

Get fast or get passed: Nearly every executive we interviewed across all four roles cites the need for speed to thrive today and to stay competitive going forward. Complacency is unacceptable. Speed must be a consideration in all strategic decisions and most tactical ones, too. This need for speed is compelling leaders in all four roles to collaborate with each other, as well as with senior executives across the organization in areas such as finance, logistics, and product development. Collaboration, they point out, is the only way to move swiftly enough to survive in today’s hyper-fast and ultra-competitive market.

In addition to these topics, several issues and opportunities emerged unique to executives in the VP of Service role. Common themes include improving the customer experience by transforming service, collaborating with peers across the organization to facilitate change, and exploiting data for its analytical and predictive value.

The CIO in 2019

Digital transformation and the Customer Revolution are upending legacy technology practices and driving an all-too-often overly enthusiastic preference for quickly adopting new tools. CIOs tell us that, as a result, they are torn between competing priorities. These include responding to disruptive forces while meeting internal and external customers’ exacting expectations; supporting new business models and continuing to innovate while ensuring that their department meets its users’ day-to-day needs; and balancing competing legacy and SaaS requirements as they sunset some tools and adopt others while running them concurrently. These executives are challenged with balancing all of these competing priorities on a budget. Further, they’re tasked with intensifying their use of analytics to guide innovation, selecting new metrics that align with new business models, and getting more return from technology, data, and their teams.

This is evident in how the priorities and responsibilities of the role have changed. As part of our in-depth interviews with senior executives, Salesforce spoke with 13 CIOs. We compared the findings from those conversations with research we conducted in 2014 on a suite of executives that included the CIO.

Here is how our CIOs view 2019 versus 2014 in IT operations management, the proliferation of SaaS, and data and analytics. For the sake of brevity, some quotations are paraphrased but reflect the sentiment accurately.

IT Operations Management

CIO as Influencer: In 2014 none of our CIOs spoke of change management as a core skill, something essential to their ability to execute their mission. In 2019 the CIO is not just an agent of change, but also a manager of continuous change. This “role” has become an expectation; CIOs are fast becoming the CEO’s designated instrument of change. That status is best reflected in a recent interview LinkedIn executive editor Dan Roth conducted with GE’s CEO, Jeff Immelt. Immelt said that five years ago he and his COO would have held a business review and never thought of inviting the CIO. In 2019, he said, it would be unthinkable to run such a review without the CIO.

Similarly, in 2014 none of our CIOs spoke of themselves as the instruments for creating a competitive advantage. In 2019 several of our CIOs see themselves as exactly that. The mandate of one CIO extends into all digital aspects of the customer experience with the goal of creating and sustaining a competitive advantage. He’s not alone in prioritizing digital initiatives. Nearly every one of our 2019 CIOs sees their digital transformation mission as that of creating a sustainable competitive advantage for their company.

Team Dynamics: In 2019 revamping the leadership team is typically the first step in the IT department’s longer change journey—unlike 2014, when there was little evidence that CIOs changed out their direct reports in a wholesale manner. One of our 2019 CIOs replaced four of his six direct reports. A primary reason for this top-down overhaul: CIOs now believe that technology can always be made to work, but they worry about their people’s ability to effect change fast enough. One CIO says of the changes he made to his leadership team: “It wasn’t a surprise to any of them. They had become reactive, good at putting out fires. I wanted strategic thinkers.”

IT Empowerment: Along with leadership-level housecleaning, CIOs are gaining the speed they need in 2019 and beyond by adopting an empowerment-driven approach to decision-making. Our CIOs have pushed decision-making down to the frontline staff that interacts with and serves the internal customer. Many of the CIOs have developed frameworks to help guide their team’s decision-making. One CIO calls his framework a “rubric.” IT team members are empowered to solve internal customer problems or drive innovation if the parameters of the solution fall within the rubric’s guidelines, which include elements such as mobile first, embed security upfront, no customization, build with connectivity in mind. This kind of empowerment requires training, which has become an investment priority in 2019 that it certainly was not in 2014.

Speed of change: 2019’s CIOs move faster than their 2014 peers because speed is now essential to survival. Even so, the 2014 finding that IT was not moving fast enough to support the needs of the business comes across loudly again in 2019. This need for speed has led several 2019 CIOs to adopt a “test and fail fast” approach to innovation. Several CIOs say part of their job is to provide “air cover” for their teams’ innovation efforts.

Even as 2019’s CIOs push for speed where they can, legacy issues continue to constrain their ability to respond as fast as the lines of business or peer functions demand. This more purposeful pace of change, however, is preferred by many of the CIOs. Only IT, they say, truly understands the technology and process dependencies and can avoid what might be disastrous, unintended consequences of rushing to implement new tools.

Shadow IT: The CFO now wants the CIO to have visibility into the “total IT spend,” our 2019 CIOs assert. To do that the CIO must have total control over IT spending. So, these CIOs say they’re “sweeping in” shadow IT. But they’re not fighting turf battles with established shadow IT organizations in such areas as marketing and sales—as long as those operations remain effective on their own.

SaaS Overshadows Legacy Systems: The majority of our 2014 CIOs talked about SaaS in terms of the future. In 2019 SaaS has become core to enterprise architecture for most of our CIOs. They now dedicate substantial time to SaaS orchestration and to managing strategic vendor relationships. At the same time, many of 2019’s CIOs consider their legacy systems “a mess.” They blame the situation on “proliferation” from their predecessors’ tactical thinking. The 2019 CIOs will not allow SaaS proliferation to become the legacy burden of the future.

IT as a Service: In 2014 CIOs said they needed to be in constant communication with the line of business leaders. Yet, there was no mention of the need to organize the IT function as a “services model.” With today’s emphasis on customer experience and speed, our 2019 CIOs have done exactly that: organize dedicated IT resources in support of business teams and specific outcomes. Those resources assure continuity from project to project. The CIOs’ peers appreciate the value of that continuity.

There’s also a greater focus on collaboration today than there was in 2014. Collaboration fosters speed, and the 2019 CIO emphasizes the collaborative nature of IT’s relationship with the groups it supports. As one CIO puts it: “Nothing major can be accomplished without cross-functional collaboration.”

Reimagining IT: None of our 2014 CIOs talked about “marketing the IT department.” In 2019 that idea has taken root. One CIO has hired his own “communications manager,” another hosts a weekly TV show to highlight current projects and recent successes. A third CIO publicizes the IT budget to the entire company for reasons of transparency. Several of our 2019 CIOs have improved their companies’ perception of IT by creating standing cross-functional teams to set priorities and allocate resources.

But today’s CIOs aren’t solely interested in managing short-term perceptions. Unlike in 2014, when none of our CIOs spoke of leaving a legacy, in 2019 there is an idealism fueling the sense of mission among several of our CIOs. These CIOs want to set the industry standard for how IT departments in particular and companies as a whole should operate. They want to take actions today that will positively impact their organization and industry now, as well as over the long term.

Career path: In 2014 our CIOs were uniformly from an IT background. More than half of the 13 CIOs we interviewed in 2019 have taken non-IT career pathways to the CIO position. These CIOs talk about the need for wider business exposure today and embrace the notion that “the CIO must know the business better than the business.”

Budget: In 2014 CIOs allocated approximately 80% of their budget to maintenance and 20% to innovation and improvements. Today CIOs allocate 57% of their budget to maintenance and 43% to innovation and improvement. This reflects the imperative for change and innovation so prevalent today. In 2014 we noted that CIOs dream of a world in which 50% of their budgets go towards improvement. That dream is close to 2019’s reality.

The Proliferation of SaaS

Connectivity: SaaS capabilities feature prominently in the thinking of today’s CIOs who see these systems supporting wider connectivity and extending into customer-facing applications. With the current ballooning of the Internet of Things and the prediction that IoT will expand to 50 billion devices by 2020, connectivity has become central to the strategic planning and innovation thinking of the 2019 CIO.

Security: In 2019 SaaS has become an essential strategy not only for reasons of speed. Echoing a growing sentiment, one CIO points out the prohibitive cost of securing his organization’s data on legacy systems. Only a SaaS vendor, he believes, could fund the kind of escalating data security required to fend off ever-more sophisticated attacks.

Usability: Ease of use was a key consideration in SaaS selection in 2014. That has not changed in 2019, but the emphasis is greater today because of the positive impact ease of use has on adoption, speed, and productivity.

Architecture: Today’s wider adoption of SaaS is raising the profile of the enterprise architect. The 2019 CIO is looking to avoid the complexity and proliferation of legacy systems, so is placing greater importance on the enterprise architect and the responsibilities related to that role.

Vendors: CIOs in 2019 are putting significant weight on the pace of product and service innovation a vendor can demonstrate. The rest of the business wants the CIO to drive digital transformation as fast as possible. Innovation is essential to speed, so it has become a key factor in vendor selection.

Data and Analytics Data Management: In 2014 none of our CIOs talked about master data management (MDM) as a priority. In 2019 MDM has emerged as a major issue. Yet, few of our 2019 CIOs can describe their data as a “single source of truth.” Instead, they “dump” all the structured and unstructured data into a data lake hoping that “we’ll be able to figure out what to do with it later.”

Data Quality: Every CIO appears to accept that advanced analytics are vital to better, faster, more accurate decision-making. Those analytics, however, depend on the completeness and accuracy of the underlying data, and that is where the problem lies for most of our 2019 CIOs.

Budgeting: Every CIO in 2019 recognizes the value and potential of big data. As a result, many of those CIOs are allocating a substantial proportion of the IT budget to unlocking the insights hidden in those reams of data, because of the potential to use that insight to create a competitive advantage. One CIO is passionate about the advantages of making data “agile.” He says that making his organization’s data directly accessible to users will multiplying the value of that data.

Ownership: Many of our 2019 CIOs have elevated the managers responsible for data and analytics to direct reports. Some CIOs have put data under the control of the enterprise architect because, as one CIO puts it: “I believe there is a tight coupling between enterprise architecture and how data flows.”

Meet the CIOs

Thirteen CIOs participated in the research, which consisted of one-hour phone interviews. They represent a variety of industries: entertainment, financial services, hospitality, information services, insurance, manufacturing, retail, shipping, technology hardware and software, and travel. Our CIOs represent a variety of perspectives on the IT function.

Of the 13:

  • Nine have the CIO title
  • One title includes “VP Emerging & Enterprise Solutions”
  • One CIO has the additional title “SVP Business Operations”
  • Two have a “Chief Technology Officer” title, and one of them
  • is also the “Chief Digital Officer”
  • Ten of our executives have been in their current role for three years or less

The New Profile

Business Strategist: The route to the CIO job runs less and less frequently through the IT organization. Of the CIOs interviewed for this research, seven of the 13 have come into the position from departments other than IT, including business operations, business process outsourcing, and product engineering—some with P&L responsibilities. As one CIO puts it: “The CIO needs to know the business better than the business.” And because the IT organization touches every part of the enterprise, “only IT knows the connections and dependencies between systems.” This is especially important in organizations with significant legacy technologies. It is all too easy for executives outside IT to ask to rip out old systems and replace them with SaaS tools without considering the potential ripple effect. “Everyone wants that to happen, but there are always unintended consequences if you don’t know how things are connected,” the CIO points out.

Team Leader: CIOs operate from a common assumption that “technology can always be made to work, and work fast.” But the speed at which a company can achieve digital transformation depends on more than just technology. The number one driver or inhibitor of digital transformation is the speed with which people can deliver and master the enabling technologies. Many of the CIOs interviewed say: “We can only go as fast as our people.” CIOs work hard, therefore, on building the leadership skills they need to develop their people, as well as the collaborative skills required to move in concert toward a common purpose. Along with the leadership coaching some companies provide, today’s CIOs educate themselves through activities such as reading about and listening to webinars on leadership strategies in business and in fields such as the military or sports. They see building their leadership muscle as central to their success and they invest time accordingly.

Master Marketer: Perhaps the most colorful finding to emerge from the research is the trend towards the CIO as a “marketer of IT.” One CIO has hired a communications manager. “He comes out of my budget and reports directly to me,” he says. “I control the content and the agenda.” The CIO sends out a weekly newsletter that shares success stories, celebrates individual and team contributions, and calls out business benefits. This internal publicity helps the CIO accumulate the corporate capital he can then spend in support of other items on the IT agenda. By announcing new IT initiatives through the newsletter, the CIO has uncovered duplicate efforts being carried out by shadow IT groups, who then cede control back to IT. Another CIO publishes the IT budget in full and makes it available to the whole company. IT transparency is now “marketed” as part of the department’s “brand promise.” And one CIO with global responsibilities hosts a regular “IT TV” show to provide insight into new and ongoing initiatives.

Legacy Makers: Several of our CIOs talked of wanting to leave their mark on the company, their industry, and the world in general. They see the CIO role carrying the potential to deliver change that can benefit society as a whole. The common sentiment among those CIOs is, “I want our company to be the model for the industry.” Another way they plan to leave a legacy is by implementing technology solutions that will make the greatest organization-wide and long-term impact, as well as be a building block to future success.

Culture Evangelist: In many instances the CIOs are cultivating change in their IT organization to reflect the culture the rest of the organization must evolve into. One CIO spoke about developing the habit of curiosity within the IT organization. The company itself operates in a highly Socratic manner, and IT teams now interact with their internal customers principally through “rigorous questioning.” The IT organization itself was renamed to reflect the importance the culture now places on innovation.

Tribal Loyalist: CIOs are tribal. They continually develop their networks: “Everyone else in the Valley knows everyone else.” They use that network to get “the real story” on products and vendors. Although they get the most value learning from their fellow CIOs, they also subscribe to analysts firms such as Gartner and Forrester, and make sure they’re reading what their CEOs are reading—and writing. Vendor-sponsored events remain popular ways for CIOs to connect with peers who might be tackling similar problems in different ways. Additionally, strategic vendor relationships appear to be growing in value; several CIOs say they devote as much as 30% of their time to these relationships.

The New Operating Imperatives

Cultivate a cascade of change: The majority of our CIOs have been in their current job for fewer than three years. They were brought in as change agents, and there is consistency in the way they have gone about effecting that change. They begin with their direct reports. They want leaders who have experience in driving digital change in their own areas of competence. For most of our CIOs, this has meant going outside for the required combination of talent and experience. It is not uncommon to see turnover rates as high as 100% in these management teams, and the cascading effect may continue several layers deep. Most CIOs can’t take the time to train in-house talent in the new skills they need; similarly, the business can’t afford to wait for current staff to acquire the experience necessary to thrive in today’s fast-changing tech environment. The need for speed dictates speedy action.M

Build new business models: Part of CIOs’ change management plan is to remake their organization’s business model to better align with their company’s overarching business requirements. One way they’re doing so is by making customer experience a core tenet of the IT mission. Some are developing personas and customer journey maps; others are evangelizing a “service ethic.” Many are remaking their IT organizations by adopting a “services model.” This involves restructuring the IT department, often using a matrix model, to dedicate resources to business units in a way that assures continuity of personnel. This is especially important because LOBs and internal departments can no longer afford the “lost learning” that occurs when IT teams are “disbanded at the conclusion of a project and then assembled from scratch again, based on who’s available, for the project’s next iteration.”

Dedicated teams also allow IT to meet the need for the continuous software releases common in today’s increasingly SaaS-heavy environment. The business wants access to new features as they become available, not when it is convenient for the IT department to issue them.

CIOs are rethinking the KPIs they need to use as they adopt this customer-centric approach to IT. One strategy—that further assures alignment with other departments, as well—is to measure their dedicated teams on the business outcomes important to the functions or LOBs those teams support: “The IT team dedicated to Finance, for example, could be measured on billing errors,” one CIO explains. “We want to understand our customers’ problems, so we can work with them if there is a technology component to the cause or to the solution.”

Equip frontline staff for manager-level decision-making: Like their counterparts in Marketing, Sales, and Service, CIOs are pushing decision-making as close as possible to the point of engagement between IT and the customers it serves. They are reducing or eliminating decision gates in pursuit of speed and employee engagement. This change includes training frontline employees with the skills necessary to think like a manager.

Some CIOs push empowerment to an even deeper level by disrupting the traditional notion of application development. They essentially emancipate development by opening it up to frontline employees. One CIO created a development toolkit that employees use to develop apps that allow them to solve problems specific to their job. This approach is primarily in response to the consumerization of the enterprise and the need to adopt a more consumer- and role-based approach to technology deployment.

Constrain shadow IT: The need for transparency and for visibility into an enterprise’s total technology spend has made the CFO a strong ally in the CIO’s campaign against shadow IT projects, over which CIOs have no control. Given that the CIO must find savings to fund innovation and improvements, the CFO cannot condone shadow IT projects. Only a CIO who has total control over the company’s technology spend can be reasonably expected to hit cost-reduction targets. Shadow IT is still alive but its days of proliferation are over. Many of the CIOs interviewed cite shadow IT as being “swept back into the [IT] organization.”

The new breed of CIO is tolerant of splinter projects, so long as they meet certain criteria and happen within a defined context. Once a project develops to the point where it may have enterprise-wide implications, for example, the CIO takes control and the project falls under IT governance. That said, CIOs do not fight battles that have already been decided. If there are established sales or marketing ops teams independent of IT and working effectively, for example, the CIO will leave it as is.

Develop adaptability: Today’s CIO has co-opted the motto: “Adapt, improvise, overcome.” This is especially true for CIOs of companies that focus in large part on growth through acquisition. The CIO must develop strategies that absorb the disruption of an acquisition without derailing the IT department’s primary missions of serving its customers and driving transformation. CIOs in the largest enterprises typically create dedicated M&A teams. Even in companies that see fewer acquisitions, the CIO will work hard to minimize the M&A impact on daily operations and innovation priorities. In the era of digital transformation CIOs have to balance, versus prioritize, these initiatives. They often succeed in doing so, which leads to the impossible (or at least the extremely difficult) becoming the expected.

Contain SaaS proliferation: CIOs working within established enterprises often look at their operations and see a proliferation of legacy systems and applications that were deployed with little strategic consideration. Their predecessors, they feel, were often too tactical in their decision-making. As our CIOs hurry towards a cloud infrastructure and a SaaS operating model, they are cognizant of the need to restrict the number of core components and strategic vendors. SaaS proliferation is the last thing they need. Several have developed what one CIO calls a strategic “rubric” that can be used to guide decision-making at every level. Here is an example:

  • Think Web first
  • Use proven frameworks
  • Build with the future in mind
  • Extend with connectivity in mind
  • Embed security upfront
  • Standardize but be flexible

Update metrics: Traditional IT and security metrics are now supplemented with metrics relevant to the new imperatives of speed, service, and innovation. Cost savings and cost ratios have come into sharper focus for CIOs, primarily because those savings must fund innovation. Net Promoter Score has become universally adopted as the primary CX metric. CIOs are using “projected contribution to ROI” for projects that lack a direct, readily measured ROI. Additionally, vendor scorecards are becoming popular, especially two-way scorecards where “both parties have skin in the game,” several CIOs point out. No CIO claims to have cracked the code for measuring change effectiveness, but many are working on it.

The New (and Continuing) Challenges

The bimodal challenge: Legacy issues remain the bane of the CIO. One says: “Digital disrupters can build new IT landscapes. But established companies with legacy IT systems must consider how best to integrate digital.” Most of our CIOs consider Gartner’s bimodal strategy to be the most practical approach to successful change. Forrester insists that businesses must adopt speed above all other imperatives and that bimodal is a sure route to a slow death. Of the CIOs interviewed, only one is successfully executing the Forrester strategy to get ahead of the legacy drag: “We’ll be 60% in the cloud by the end of this year,” he says.

It seems, however, that no enterprise CIO is able to move to a cloud infrastructure fast enough to please the business units. A fast, yet cautious approach is better than speed for the sake of speed, however, because of what our CIOs call the “unintended consequences” rule. Replacing nine different legacy billing systems with a single comprehensive one is a good idea. Replacing those billing systems with a SaaS application that changes the way the enterprise realizes revenue may not be so clever if it impacts quarterly earnings. In a publicly traded company the CIO is as cognizant as the CFO and the CEO that the business must be managed in line with Wall Street’s expectations.

SaaS as a double-edged sword: Several of our CIOs referred to “the Salesforce Effect”—the market dynamic forcing technology companies to offer their products or services on a subscription basis. The Salesforce Effect works to the advantage of most CIOs looking to cut costs. CIOs in technology enterprises that are struggling to become SaaS companies, however, face the other edge of the SaaS sword as IT must support two business models while the company builds one and retires the other. The need to support both business models during this transition makes it especially difficult for CIOs to find the savings required to fund technology investments.

Data management: Most CIOs we interviewed characterized their approach to data management this way: “We’re dumping everything we can into a data lake and hoping we figure out what to do with it later.” These CIOs acknowledge a problem with data quality and point to MDM as a major (current or future) investment. Only one CIO is making real progress taming his unwieldy data. “With proper governance in place, our internal IT organization implemented a single, integrated data model that spans horizontally across process areas, guarantees one version of the truth, and ensures that impacts of changes in one area are recognized and addressed in related areas,” he says. Consistently accurate master data, this CIO asserts, “ensures that business and IT capabilities work in unison and that key processes and capabilities are operating in sync.” The benefits stack up. “Centralizing the data management function avoids duplication of effort, uses relatively fewer resources, and lowers data management costs.” Perhaps most important, this CIO’s MDM strategy “avoids the incalculable costs and risks associated with poor quality and inconsistent data.”

Security breaches: Security is becoming exponentially more complex. As the consumerization of IT expands, the related expectations regarding mobility, devices, and connectivity also continue to grow. CIOs must address these expectations within context of the rapid adoption of cloud computing and SaaS solutions. No CIO takes security lightly, but their attitudes vary. For example, one CIO believes that “security is now a given, like availability or latency.” Another sees current security problems as the seeds of a much greater security threat that could flourish as the Internet of Things mushrooms to a projected 50 billion devices by 2020 and the points of vulnerability expand exponentially.


What does the future hold for the CIO? Our 2019 research findings tell a distinct story about how the CIO role is changing and where it is going. CIOs have risen in power and influence over the past few years, becoming their CEO’s primary and indispensable instrument of change.  

In even the most sophisticated technology companies, the CIO has become the de facto translator of technology’s relevance for and application to the business. Even where a CIO does not report directly to the CEO, the strategic importance of the drive to digital transformation, accompanied by an acute sense of urgency, has empowered CIOs and secured them a seat at the table where the most significant strategic decisions are being made. Because of this, the CIO job itself no longer necessarily represents the pinnacle of a CIO’s career aspirations. For some of our CIOs, the job is an opportunity to acquire experience and demonstrate abilities that will allow them to compete for the top spot in their own organization or at some other company.

But the journey CIOs are taking toward leaving a legacy at their firm or taking the CEO role at their company or elsewhere isn’t an easy one. CIOs are torn between competing priorities, such as responding to disruptive forces and new business models while ensuring that their department meets its users’ day-to-day requirements, continues to innovate, and balances competing legacy and SaaS requirements. These executives also are challenged with balancing innovation, bimodal operations, and emerging business models on a budget. Further, they’re tasked with such imperatives as intensifying their use of analytics, transforming KPIs to align with new business models and expectations, and getting more ROI from technology, data, and their teams.

As CIOs move from simply the Owner of Information and Technology to also being a business leader, culture evangelist, marketing guru, and legacy builder, they can look to their peers’ successes and strategies for guidance. In doing so, they’ll find the insight and support they need to succeed.

  1. The Salesforce Effect refers to how business customers are forcing technology companies to offer subscription-based pricing.

  2. The Amazon Effect refers to the pressure that Amazon puts on traditional retailers by making money in ways other than retail margin.


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