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CIO Habitat: The Trouble with Next-Generation IT Leaders

The next generation of IT leaders has some current CIOs worried. What's wrong with these newcomers?

Libraries overflow with books on leadership. A content analysis of this literature reveals that IT executives are rarely featured there.

Best-selling writers, in fact, seem to target IT folks as readers of leadership books, not as exemplars worthy of appearing in their pages. Business school curricula focusing on leadership rarely include case studies of IT practitioners. Often the IT case is used to demonstrate what not to do.

Even worse, IT executives themselves seem to lack much faith in the capabilities of the generation of leaders coming up the ranks behind them. In our ongoing CIO Habitat research (see "Methodology") at the IT Leadership Academy, we recently surveyed some 300 executives via e-mail on this topic. More than 80% of respondents perceived the next generation of IT executives as lacking the skills needed to lead IT in the future. This has several CIOs we talked with scared witless.

Will the IT leaders of the future be able to make tough technology and business decisions? The majority of our respondents saw them as less capable than the current generation; only 11% thought the up-and-comers would do a better job. Yet despite this pessimistic outlook, leadership is an eminently improvable skill.

The Crisis State of Leadership

Three factors that contribute to the perfectability of homo technologicus are:

Personal growth. Many leaders-to-be, recognizing that they are good managers but not yet great leaders, take it upon themselves to seek out affordable, time-compressed leadership training. They participate in leadership seminars at IT conferences or executive education programs such as the CIO Practicum Dinner Series at the Ohio State University's Fisher College of Business or the new IT Value Studio program at Florida Community College in Jacksonville (which sponsors the IT Leadership Academy).

CIO initiative. Great C-level leaders get passionately involved in grooming the next generation to meet the challenges of the future. For example, CIO Barbra Cooper of Toyota Motor Sales USA Inc. and CIO Gary Masada of ChevronTexaco Information Technology Co. are currently working closely with the faculty at the Haas School of Business at the University of California at Berkeley to craft curriculum for the newly created Berkeley CIO Institute.

Vendor self-interest. Some technology suppliers are coming to realize that smart executives do more things with IT. I've worked with several ahead-of-the-curve vendors -- including SAS Institute Inc., Prodigen LLC, Seagull Software Systems Inc., Syntel Inc. and Tata Consultancy Services Ltd. -- who are sponsoring programs designed to improve the leadership skills of the CIO's direct reports.

Different Day, Different Role

Staring Across the Great Generation Gap

Sometimes, perception stems from a generation gap. Throughout this research project, our inquiries provoked some strongly entrenched and deeply felt generational preconceptions -- such as what the baby boomers coming off watch really think about the Gen-Yers and Millennials arriving for duty. And vice versa.

There appears to be a widely held belief on the part of many in society that the next generation of leaders (typically a subset of the 70 million Gen-Yers born to 75 million baby boomers between 1977 and 1994) are more technologically aware and savvy, mainly because they grew up in a world of GameBoys, Xboxes and cell phones.

This widely held assumption may not be true.

As one CIO of a midsized Southern bank explained, "These people are, at best, Circuit City drive-buyers. If something breaks, they have no clue how to fix it. They don't know why things cost what they cost. They are consumers and users of technology, not designers and operators. I am very concerned [about what will happen] when these Juvenocrats actually have responsibility for running IT in this country."

Contrast that statement with the thought from a midcareer, middle market, mid-Atlantic IT executive in telecommunications who believes that while the "kids" may not understand the nuts and bolts of how technology actually works, they do understand how the organizations that buy those gizmos and solutions operate.

"Next-generation engineers [just graduating from college] are much more comfortable with diffuse organizational structures and collaborative [global] interactions," this executive notes. "The next generation of IT leaders will have grown up with multimedia gaming and instant messaging. Alas, their bosses are still a step behind."

Dave Clauson, a serial venture capitalist and CEO at Reflective Corp., a consulting firm in Atlanta, says that while the knowledge base of next-generation IT leaders may "not be nearly as deep in the guts of the systems and software [as those who went before], they will probably make better business managers than yesterday's CIOs."

Yet too many midmarket organizations believe that world-class professional development programs happen only at giant companies.

One CIO at a midsized hardware supplier is passionate on the subject: "Tell me about the companies that have leadership development programs in place, that actually invest in the growth of people, and I'll show you the leading organizations of the next decade."

We asked our survey respondents if their organizations have structured leadership training/development programs for IT professionals. Only 25% did. Of those, only one-quarter were thought to be effective. Clearly, something must be done.

Adjusting to the 'New Normal'
The upcoming IT leadership deficit is complicated by the fact that the scope and scale of IT's mission is undergoing a significant transformation. What IT must lead is changing. For the Next Generation CIO, there is a "new normal."

From sequestered wizard-priests tending giant machines in isolated dungeon-temples, our profession has emerged from its early-stage isolation. We have moved from a focus on back-office processes to become, often, a major part of front-office, customer-touching, revenue-impacting activities. IT is the base of the customer experience from before a product or service is designed through to its delivery, deployment and billing.

One of the major challenges facing this next generation of IT leaders will be repurposing and rebranding IT. A brand, after all, is a promise. But IT, in the mind of many senior executives, is not good at keeping its promises. It doesn't matter whether it's something seemingly trivial like an enterprisewide desktop upgrade, something infrastructural like an ERP deployment or something truly strategic like a business intelligence/analytics project. In many organizations, IT still has a reputation for not delivering on time, on budget or to specification. Gene Kranz, mission director for the Apollo space program, is remembered for stepping up and announcing to people involved with Apollo 13, "Gentlemen, failure is not an option." IT needs to get on the Kranz bandwagon.

A much-improved set of leadership skills is required to deal with the expanding complexity and interdependence of systems being deployed. Good intentions are not enough. How things work in concert is critical. Remember that at the Chernobyl nuclear site, it was the testing of a new safety system that helped cause the meltdown, fire and subsequent disaster.

As we think about repurposing IT, the good news is that the battle of cost-cutting is coming to an end, and the battle of innovation and value creation has been engaged. This could be IT's finest hour, but only if we can become polyheroic in leadership style. That means everyone on the team is a hero, but even more importantly, everyone has to lead.

--T.M.

During the Industrial Age, the exercise of "learning" somehow got separated from the exercise of "doing." You could be in school or you could be at work; the widely held belief was that one could not be simultaneously involved in both. This is wrong. One learns while doing. The truly great among next-generation leaders will learn the "big ideas" of leadership while moving the ball forward with day-to-day tasks. Development programs will put day-to-day activities in "context." This is why training at community colleges and in executive MBA programs is growing, while students (and potential employers) are questioning the value of traditional, full-time MBA programs.

We are on the cusp of a leadership shortage. As one CIO at a midmarket apparel maker points out, "With the market turnaround, we have begun and will continue to seek out the future leaders inside the company, but we do not think we will find many."

The CIO at a midsized utility explains: "Most people seem to be catching up at this point. Being future-focused and not just cost-focused is happening. Our conversations of late seem to have much more of a vision on where we want our IT systems to be versus why they cost so much."

Two common threads ran through all of our CIO Habitat conversations about next-generation IT leaders. One: The general business population lacks enough understanding or knowledge of technology to operate without the safety net of a professional IT organization. And two: The graduates of traditional business educational programs aren't qualified to step up to this challenge.

One California-based CIO has made a practice of hiring business graduates from nearby universities for IT positions. But he is increasingly concerned about the longer term impact that will have on his organization's capabilities to create value through technology.

"Some of them come in thinking they know computers, [but] usually it means they can create a moderately complex Excel model or a fairly simple Access database," the CIO says. "As soon as they try to make one of these accessible to more than one user, it generally blows up -- due, of course, to some severe limitations of that software -- but also due to lack of knowledge about database management and integrity. So that tells me most business students aren't getting exposed to any real IT education."

The Changing Nature of the IT Leader's Role

Brian Marcov, former manager of restaurant systems at the Del Taco chain based in Lake Forest, Calif., has a helpful perspective. "Historically, organizations usually wanted to hire technically oriented managers, directors and CIOs to solve the technical issues. The problem is, the real issues aren't of a technical nature anymore."

Dave Johnson, the future-focused CIO at Jones Lang LaSalle Inc., a $1.1 billion real estate services and money management company based in Chicago, explains, "IT should be part of everyone's job description today. Many companies still look to the CIO to be the sole answer to innovation and advancement in technology."

That new kind of leadership must balance a significant injection of human skills into the discipline while at the same time delivering insight and deep understanding into how technology actually works.

Research indicates that we are standing at a historic moment, one that's unique in promise and potential. Lamentably, many organizations lack IT leadership because they have failed to manage their leadership pipeline. They will continue to plod along, incrementally reducing costs and responding to banal system requests from uninspired users.

But the greatest next-generation IT leaders will unleash their inner creativity. Watch and wonder as an emerging subset of the IT profession transitions from a mechanical art to a liberal art.

SURVEY METHODOLOGY: In a series of open-ended questions, 300 CIO Habitat e-mail survey participants were asked their opinions about next-generation IT leaders. The CIO Habitat Report research team then conducted phone interviews with almost 100 survey respondents, who were asked to expand upon their responses. Approximately 85% of the respondents were IT practitioners, and 15% were senior decision-makers in the vendor, outsourcer and consulting sectors.

This was last published in April 2005

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