Taking charge The essential guide to CIO transitions
The average tenure of one of the most high-stakes, challenging jobs in an organization is just four years. Why do technically proficient leaders stumble when it comes to soft skills? Khalid Kark clears the air about how CIOs can manage expectations in their new role.
Even if there is a single failure in the first few months, yes, you can, for a certain time frame, blame the previous leader. But I think your neck is at stake, right?
TANYA OTT: It’s one of the most high-stakes, challenging jobs in an organization and you don’t have much time to get the shop in order. What is it and what should you do? We’re going to break it down today on the Press Room.
I’m Tanya Ott and this is Deloitte Insights’ podcast on the issues and ideas that matter to your business today. Let’s get right to it! A recent survey found that the average tenure of a Chief Information Officer is just four years and three months. That is one of the shortest tenures in the C-suite.
KHALID KARK: A few years ago, it wasn’t uncommon to interact with a CIO and [a] year later, they’d be in a different role, different position, etcetera.
TANYA OTT: That’s Khalid Kark. He’s the research director for the CIO program in Deloitte Consulting LLP. I asked him—what is going on?
KHALID KARK: There’s a couple of factors at play here. First is, [the] CIO is a relatively new role into the C-suite. Yes, CIOs have been around since the ‘60s and even before in some cases, but the role was primarily to support and enable the back-end technologies for an organization. And so, C-suite interaction was there, but that wasn’t really a real C-suite executive role. All the other roles have existed for a lot longer. They’ve had time to establish themselves and figure out what they needed to do and support. That’s one element.
The second is, the role has evolved so rapidly since its inception that we are starting to see the role that existed five years ago for CIOs…. Very little of it remains today. So the role keeps evolving, the expectations keep evolving, and much more importantly, the business context that the CIOs are operating in keeps changing so rapidly—with technology being the core of everything now. It is just a phenomenal journey that we have seen the CIOs take.
TANYA OTT: You’ve got another stat [in] your article that really caught my attention. It’s that, 23 percent of people in those transitions that you looked at, the previous CIO was either demoted or asked to resign.
KHALID KARK: Yes.
TANYA OTT: That means that the new CIO taking that position is probably going to feel a fair amount of pressure from day one.
KHALID KARK: Yeah, it is. The role is becoming so important that there is very little patience for anybody who’s not able to fulfill the expectations of the role. Traditionally, you grew up in IT, you spent 20 years, and you’ve kind of gone through various tasks and activities. You’ve managed the infrastructure. You’ve managed the applications. Now you become a CIO and that traditional path is still there, and there [are] still a lot of good leaders coming in through that. But it’s not a guarantee.
Many times, we see that people who [are] what we’re calling demoted or fired are people who have had that role or technology background and expertise. They were groomed to be leaders within their organizations, but weren’t able to pick up and run with the C-suite expectations around strategic alignment and making sure that you’ve got the right relationships with the business stakeholders and those kinds of things. The softer skills are where they stumble. I don’t think any CIO, when they get there, has any issues with technology or technical acumen. Where they stumble, most of them, is on the softer skills. Either it’s a relationship issue, a cultural fit issue, or just not having the capacity to lead an ever-evolving IT organization where the mandate keeps changing as well.
TANYA OTT: You run the CIO transition lab and that’s where you help CIOs transition into new jobs, whether they’re new to the CIO role or they’re taking that role in a new company. What is your goal with the transition lab?
KHALIK KARK: That’s a great question. There [are] a lot of executives that need a little bit of support as they take on the role. These are really complex roles and they require you to take a very deep dive into the organization trying to understand and do a lot of things very quickly into the role. What we realized was we can help executives through these transition labs by, one, bringing them a little bit of outside-in perspective and, two, giving them a sense of an overarching view that they want to have and take them out of the weeds.
Many times when we do these transition labs, the CIOs are really thankful because it allows them to take a step back from that day-to-day operational details of what they’re doing to think broadly and think strategically across what they want to achieve and what kind of game plan do they have to achieve those things. A couple of months into the role, we asked them to come and spend a day with us and allow them to take a step back and help them figure out what their plan is going to be for the next six months or so, so that they can strategically focus on a handful of objectives rather than trying to do everything themselves in the first few months.
TANYA OTT: You talk about having that plan. I did a scan of some of the best-selling business books and you’ve got titles like The New Leader’s 100-Day Action Plan or The First 90 Days. That’s a lot of pressure to put on someone in the workplace. What do you think when you see titles like that?
KHALID KARK: I look at those titles and usually smile because I don’t think there is a lot of reality to that. The first 90 days are important for a CIO to make a couple of really important decisions on how they’re going to spend their time and who they’re going to interact with. But realistically, for the size and scale of organizations that we’re working with, there’s no way you can do anything substantive in 90 days or 100 days. You can start off some things, but much more importantly than that, you have to set the right example for people because you’re being judged, and your actions speak louder than words. A year is a reasonable time frame for you to assess where things were and if you’ve moved the needle on them. But, yeah, 90 days or 100 days doesn’t mean a lot in that tenure.
TANYA OTT: Now that initial chunk of time though—or that 90 days, 100 days, whatever it is—you’re probably spending a lot of time meeting people and listening to people and assessing what the current situation is and what kind of changes you might need to implement. What comes after that sort of initial honeymoon period?
KHALID KARK: Here’s the interesting thing we found in our research—unlike any other executive where you would be meeting people, where you would be trying to figure out what’s going on, CIOs are inheriting a role which has day-to-day operational responsibilities. So, first and foremost, they have to figure out if their operational house is in order. Even if it is, they need to spend time and try to understand it, because even if there is a single failure in the first few months, yes, you can, for a certain time frame, blame the previous leader. But your neck is at stake, right?
What we found really fascinating in our research was that, although when we talk to business leaders, their expectation was the CIO is going to come and be that strategic visionary that’s going to drive the organization towards alignment and so on, we found in reality the first six months or so the CIOs are spending just deep down into the operational details to try to figure out and make sure that things are running effectively, efficiently, there isn’t going to be a break down, there isn’t going to be an issue with downtime, and so on. Once they’ve assessed, once they’ve delegated, once they’ve figured out things are running the way they want, then they move on to strategic things.
TANYA OTT: The thing that’s interesting about it, though, is that in the beginning of our conversation, you talked about how one of the biggest challenges they faced are the softer skills— emotional intelligence, the connecting with people—and they’re usually sound on the technical and operational. But what you’re saying is by design, they’re going to have to spend the good chunk of the first six, nine, twelve months really digging deep into the operational and technical and not dealing with the relationships.
KHALID KARK: Yeah, I would say you can’t do one or the other, you got to do both. But there is a predominant amount of time being spent on operational details. I’ll give you a couple of examples. One CIO—really strong technical, tactical—and he came onboard and he started to dive deep into the details. When we had the conversation with some of the business stakeholders, they were like, “Yeah, we had the initial check-in, but I haven’t seen that person in a month and a half.” And their expectation was they’re going to have a couple of check-ins in the first few months and the CIO didn’t have the time to do it.
Similarly, there is an element of going out on the shop floor or factory floor or meeting some of the more important customers. You’ve got to carve out time for that, but I think that’s not your primary focus in the first six months. You got to do all things. That’s the expectation of the role today. But a predominant amount of effort is being spent on making sure your operational things are in order. Then you start to gradually shift and move towards the more strategic allocation of your time.
TANYA OTT: What are the biggest pitfalls that new CIOs need to be looking for or to avoid? The things that could be real challenges?
KHALID KARK: In our research, we lay out four scenarios, and those are the most common scenarios. If you are an internal hire, if you’re within the organization, you came in through the succession plan, the pitfall for you to be aware of is making quick talent decisions. Some of the people that you’re going to make talent decisions on have been your peers. You may have had great relationships with some individuals that may not be suitable for the role that they’re in. We find that an internal hire typically is hesitant to make talent decisions quickly, and one thing that they regret doing, when we talk to them later, is to have not made those decisions because that really impacts their credibility and their ability to do things.
TANYA OTT: So that’s, get the right people in the right places pretty quickly.
KHALID KARK: Exactly. And there is a lot of politics going on as well. There may be other people that were jockeying for that position and they may have certain resentment that they don’t show and all those kinds of external factors play into how effective that person is. Lastly, I think the other thing to keep in mind for an insider is the fact that you were part of the status quo. Sometimes, they’re hesitant to make bold calls because they were part of the decision-making in the earlier regime. Because you’ve been hired as a CIO, the expectation is for you to put a stamp on this organization and make the decisions that are needed, so you can’t be tentative about it.
Then we call this the other scenario, a hybrid insider. We use the word hybrid because they’re not the traditional CIO. They’ve led a finance organization or they’re a chief legal officer before or a chief accounting officer or whatever the case may be. They’ve had leadership positions within their organizations before and they’re being asked to come in and now lead the IT organization. In those cases, the pitfall to be aware of is they usually don’t hold a lot of credibility in the eyes of the traditional IT folks that have had a lot of tactical and technical experience and operational experience, and they’ve got to build that credibility fairly quickly.
Then there’s that third scenario, which is the outsider. And our research suggests that if there is a drastic change needed—you mentioned the 23 percent of the CIOs that are either demoted or fired—in most cases, the new CIO is an external hire. It’s not an internal hire because there is that drastic change needed within the IT organization. In that scenario, the pitfall for them is that they actually have to make quick decisions, in general. If they’re not moving very, very quickly, it becomes an issue, and for large organizations, that’s a big problem. So whether that’s putting in initiatives, [or] whether that’s making talent changes, pace of change and the expectation for the pace of change is very, very significant. If you’re not making changes in the first six or nine months, it becomes a problem and you start to lose your credibility as a leader. You’ve got to figure out how you’re going to deal with that.
The last scenario is an M&A [merger and acquisitions] scenario or a divestiture—a large company divesting into smaller companies. The issue there is that there is no strategic road map, no strategic plan. There is a deadline. This is the date when we’re going to merge and so you better get the IT house in order before then. In that scenario, when we talk to CIOs, they very frankly said, “Things are going to break. We are not going to be able to keep the systems up and running throughout this process. There are going to be fails. There are going to be breaks.”
It’s important for you to be very clear to the business leaders around those expectations and say, “Because of this unrealistic time frame to integrate technology across the board, we are going to fail at times, and we’ll keep the communication open, and we’ll do the best that we can to minimize the disruptions. But those are going to happen and so you’ve got to be prepared for that.” At that point, in many cases, because there are two organizations merging, the two IT organizations are also merging, your CIO, who was the designated CIO for the combined organization, or the new organization, may not know all the people and that becomes a problem. Because they haven’t worked with you before, you don’t know what their strengths are, etcetera. It becomes a fast-moving, high-failure environment where the CIO needs to constantly keep the morale up for the team. Long hours, really tight deadlines and those kinds of scenarios, morale for the IT organization, and the expectations of the business become really a key factor for you as you think about that role.
TANYA OTT: We have focused a lot on the incoming CIO and what that person can do to make the transition as effective as possible. But what advice do you have for that person’s boss—the CEO that’s going to help lead in the transition?
KHALID KARK: Great question. There are a couple of things. I’d start off with an anecdote. I was talking to the CIO who said, “You know, we have this whole digital thing being put on my plate now. What I’m starting to realize is that everybody’s definition of digital is different. The problem is that digital can support the overall strategy for the firm. Digital can enable it. But digital is not our strategy.” And so the point that the CIO was trying to make was that IT is there to help. IT and technology can support, but that doesn’t mean that you can just kind of wipe your hands as a leader to say, “We’re going to have technology solve all our issues and help with our strategy,” and not make the tough calls on strategy.
That’s one thing. I think technology leaders tend to be, and now increasingly have to be, collaborative with other business leaders. Many times, they have this traditional perception of the IT leader being a techie and not really being involved in the business strategy conversations and so on, and being handed over the strategy to start to execute, or just handed over this mandate of digital that’s going to somehow solve everything that the company and the firm has been wanting to do or not wanting to do.
The point being, there [are] a lot of executives that view technology as core and central to their organizations, but it takes back and forth. It takes accountability, but it also takes joint ownership. Technologists themselves can’t really go out and do everything—you need to be able to partner, you need to be able to own. What we’re starting to see is that organizations that have small cross-functional, collaborative teams are able to progress a lot quicker than the ones where technology is in a silo, standing alone trying to do their thing, where things get thrown over the wall, and they do the execution. More and more I’d say for the CEOs, technology is a partnership.
TANYA OTT: Khalid Kark writes about this and more in his article, CIO transitions: A compendium of insights.
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I’m Tanya Ott. Catch ya again in two weeks.