Bridging the CEO expectation gap
- 18 October, 2010 07:00
Meeting expectations, particularly those of the chief executive officer (CEO), remains one of the persistent challenges facing many of our CIO clients.
They frequently express these types of concerns:
- “My CEO [or CFO or COO] has cut another x% from the IT budget for next year.”
- “The business has just made another investment decision without any previous input from IT, and now we have to deliver a system to support the new investment.”
More often than not, they are followed by the question: “What should I do to stop this from happening?”
These statements often indicate the gap between CEO and CIO priorities that fuels persistent IT performance concerns in many organisations. Whether the concerns are valid or not, CIOs who understand and deliver against CEO priorities implement specific mechanisms to close this gap, thereby enhancing their contribution, success in the role and future leadership opportunities.
A first step towards bridging the expectation gap is to understand the two roles. CEOs define and lead enterprises in the face of macroeconomic, customer, market, regulatory and other challenges, translating vision into an enterprise strategy and meeting measurable performance goals. Although different roles, a CIO’s functional, operational and departmental priorities should unambiguously correlate with those the CEO sets for the enterprise. However, Gartner research on ‘CEO Expectations’ identified a measurable gap between CEO and CIO priorities that cannot be dismissed as a natural by-product of their respective roles. It is true even in a challenging period such as 2009, when you might expect sharper focus on a limited number of enterprise concerns.
The research also indicates that the most effective CIOs aggressively follow a handful of specific tenets to ensure that the IT organisation measurably enhances business unit (BU) performance in relation to those priorities, earning BU leader, and ultimately CEO, approval.
These tenets are:
- Managing BU relationships and delivering against BU leader priorities are, in many ways, more important than delivering against the priorities of the CEO.
- A positive relationship of trust and credibility with the CEO is an outcome of delivering against immediate BU leader needs, not a prerequisite for doing so.
- Strong governance is the critical capability in managing BU leader priorities, but it is separate and apart from the practices necessary to create trusted relationships.
- Time spent with the CEO should be used to understand his or her motivations, constraints and accountabilities.
A close working relationship is essential, but the nature of the CEO role creates ‘barriers to entry’ for the CIO. Those viewed as operational support-function leaders rather than strategic or trusted allies find it difficult to engage CEOs, making priority gaps more likely. Business unit leader attitudes about the CIO and IT organisation drive CEO attitudes. CIO credentials are established and CEO doors open to a closer relationship only when BU leaders endorse the CIO as a peer. In that sense, the CIO’s relationship with the business units is more important than the relationship with the CEO. The CEO’s door will stay open as long as the CIO remains focused on the end game. When this state of collaboration is achieved, the expectation gap is narrowed and the CIO is in a position to enhance CEO personal success and influence more effective enterprise use of IT, rather than be in constant defence of the cost of IT.
Poh-Ling Lee is an executive partner in Gartner Executive Programs, providing advice and guidance to CIOs and senior IT executives in Australia.
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