CIO warning: Don't make decisions alone

A decade ago, as a vice president at a Fortune 500 financial corporation, I was part of a team that pitched a project management software implementation to the CIO. I'd already come to the conclusion that this project was a bad idea with a capital B, but my boss had expressly forbidden me from sharing my misgivings with the CIO, the final decision maker.

I remember being in the meeting, wishing the CIO would start asking questions like these: "How many other companies have implemented this system?" and "What did the potential business users think of the software?" and "How would this system help the business meet the needs of the customer?"

But he didn't, and we were directed to start implementing. This disastrous project became just one of many bad decisions that eventually got both the CIO and my boss fired.

Today, as a consultant and associate professor at Pennsylvania's Kutztown University, I'm still curious about the decision-making powers of CIOs -- especially now that their previously unchallenged territory has been invaded by other senior business leaders.

Would the CIO's decision of 10 years ago have turned out differently if the business had been part of the decision-making process? The results of a two-year study I led earlier this year for the Berks County Chamber of Commerce indicate that the answer is yes.

Of the 584 organizations that participated, we were surprised to find that roughly 20% included a CIO/IT director/IT manager among those making technology decisions for their companies. Only 16% named the CIO as the sole technology decision maker. Perhaps a history of bad decisions was coming back to bite CIOs everywhere.

Roughly half the firms surveyed said that technology decisions were made by the CEO/president/owner; and in 48% of the cases (278 companies), the CEO was the sole technology decision maker. In less than 4% (26 companies), both the CEO and the CIO had been chosen as technology decision makers.

I also dug into the data to examine the impact of Internet technologies, expecting to find that organizations where the CIO made the decisions would fare better in the use of newer technologies than those where the CEO acted alone. I was surprised by the result. Companies where the CIO made the decisions did not fare much better, and those where the CEO made the call did only a bit worse.

Organizations where the CIO made the primary decision had a higher incidence of spam-filtering software and larger "pipes" to the Internet. But they had a negative correlation with customer-facing technologies, such as owning a domain name and doing e-commerce. Yet when the CEO made the decision, e-commerce and Web development tended to be implemented more often.

An odd finding, isn't it? Perhaps CIOs are still focusing inward on cost savings rather than outward on revenue generation like their CEOs.

The one finding that met my expectations was that when the CIO and the CEO get together to make the decision, the overall use of Internet technologies increased. This makes sense. Yet when CIOs make the decision alone, they don't do any better than other groups operating without a CIO. How can that be?

Perhaps this is the best argument of all about the need for the ultimate business/IT partnership: a CIO and CEO working in concert for the good of the company.

This story originally appeared in the September 2005 issue of CIO Decisions magazine.

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