Article

CIOs are catalyst for business innovation, say CEOs

Shamus McGillicuddy, News Writer

NEW YORK -- CIOs are at the center of a business revolution.

Facing intense competition, market shifts and globalization, 65% of the world's top corporate executives believe they have to introduce radical change to their companies' business models in the next two years, according to a new study released Wednesday by IBM.

Many of them say they're looking to their CIO to lead that charge.

"They're in the best position to be evangelists, teachers and influencers," says Ken Denman, chairman, president and CEO of iPass Inc., a Redwood Shores, Calif.-based provider of wired and wireless connectivity solutions. "They're in a great position to be champions."

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The study also revealed that 76% of CEOs surveyed believe that collaboration with partners and customers will be the leading source of business model innovation in the future, with technology playing a huge role in advancing those efforts.

IBM's study is based on face-to-face interviews with more than 750 CEOs, business executives and public sector leaders across the world.

The specter of such radical changes in business may make CIOs uneasy, but some CEOs insist technology is the key and CIOs have an opportunity to lead.

Technology can be the catalyst for innovation, according to IBM. In its report, IBM advises that companies "ignite innovation through business and technology integration."

"We view technology as part of the innovation process," said Ronald A. Williams, CEO and president of Hartford, Conn.-based health insurance giant Aetna Inc. Technology is the driving force behind initiatives that add tremendous value to the consumer. For example, the insurer recently implemented an application that would allow customers to compare costs among doctors.

"As a consumer, you have a choice for the first time using our technology," he says.

IPass CEO Denman says the CIO must first "embrace change." When business structures change, and even in some cases when products change, a lot of the implementation is done at the CIO level or within the CIO's purview, he says. But this often "strikes fear in their hearts" because they know it establishes a entirely new set of requirements they will have to address in terms of systems support, safety and security.

"In the best case, the CIOs are a true business partner with the CEO," Denman said. "And they don't wait until the CEO comes down from the mountaintop with the tablets to tell them what is coming, but they are actually part and parcel of the strategy and the vision."

Denman warns, however, that if CIOs don't embrace change they'll be viewed as an impediment to change. "Ultimately the finger will be pointed oftentimes at the CIO and their organization, as having either an inability to change or an unwillingness to change," he said.

Let us know what you think about the story; e-mail: editor@searchcio.com.


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