The Days of IT Empire Building are Over, Says KPMG

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Note -- this news article is more than a year old.

Presenting his views in a series of essays and blogs Bryan Cruickshank argues that CIOs have begun to adopt a 'federal approach' to IT services with many empowering IT decision making at a local functional level. He also suggests that instead of providing pan organisational services and support CIOs are better able to serve their business by focusing on governance and strategic issues.

Cruickshank says: "The CIO has the most dynamic role in an organisation. What started off as keeping the mainframe running has turned into a strategic role with a direct impact on revenue, reputation and overall business success. Keeping the lights on is, of course, still important, but faced with managing an increasingly diverse set of options in a rapidly evolving technology and business environment, the traditional CIO is changing into someone less concerned with managing information and more focused on delivering integration.

"In other words, the days of IT empire building are over. Increasingly, CIOs will be born out of the MBA mould rather than fashioned from traditional technology backgrounds. Many forward-looking companies have already started down this road, creating technology roles in each function and moving the technology function to the business. In these companies, the CIO is already acting as a strategy officer to ensure that IT delivers full business value to the company."

Cruickshank's analysis is based on data collected by IDG Research Services on KPMG's behalf. Exploring the impact of macro business trends on IT, it concludes that CIOs need to alter their focus if they are to successfully grapple with emerging technologies and the demands of 'the Boardroom'.

Cruickshank adds: "All too often, organisations overhaul their IT operations or update technology strategies in response to challenges and opportunities, but few see the subsequent alignment between IT changes and business operations as a source of strength. The result is widespread acceptance that a change in approach is needed, yet many businesses are struggling to define what their new operating model should look like.

"The answer lies in changing the role of the CIO. Traditionally CIOs supplied IT services to different departments within a business focusing, for example, on delivery of a CRM system for Marketing and a payroll system for Finance. Today's business is far different; IT is recognised as something that offers a common set of services across all functions, meaning that it must be integrated and embedded into different departments by dedicated specialists.

"The end result is that CIOs can use technology to operate at a more strategic level and pay more attention to governance. It's no longer acceptable, for example, for managers in different functions to plead ignorance about how the technology they use impacts on other areas of the business and the CIO has a role to play to ensure this doesn't happen. They can define roles, decision rights and structure to empower small agile teams, ensuring groups are formed to work together in a coordinated fashion across their traditional business and IT silos.

"Perhaps this means we are seeing the end of the CIO as we have known it. If nothing else, one thing is clear: as IT grows up, the focus of the CIO must change, too."

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