IT systems are at the heart of just about every business activity today. With the complexity of the CIO role and its heavy operational responsibilities, there is no shortage of ways to derail CIO careers.
Whether it's an ERP system for supply chain management, CRM for sales, contract management for legal or accounting software for finance, CIOs are responsible for deploying, customizing, integrating and supporting hundreds of business applications. It's not surprising that these initiatives are often perceived as falling short.
Despite the many IT initiatives that can go wrong, CIOs can anticipate and neutralize many of the challenges that threaten CIO career paths with a combination of business strategies and appropriate technologies.
CIO career path: The 5 most common reasons CIOs are fired
Here are the common reasons CIOs are fired and pointers on how to protect against them:
1. Security failures
CIOs are not only responsible for business applications; they also have to make sure they meet the highest standards for security and regulatory compliance. A data breach can result in permanent reputational damage, financial losses and upset customers, which is why security failures are a leading cause of CIO dismissals.
Some high-profile breach examples -- and the business tolls they exacted -- are readily available. Google shut down its Google+ social network in 2018 and wrote off a multibillion-dollar investment as a result of a data breach. Uber was fined $150 million for a 2016 breach, much of which was punishment for trying to cover things up by paying hackers $100,000. If your data is compromised, you are better off reporting it than trying to sweep it under the rug.
But technical attacks are not the only threat to data security, or even the primary threat. Our research shows that 90% of data breaches are the result of social engineering. It can take less than a month to prepare and launch a serious social engineering attack and more than half of them -- roughly 60% -- succeed.
Applications must be secure, antivirus software should be installed on all PCs, and the entire company should be trained and actively tested on resilience against social engineering attacks. CIOs must also assume that a black hat hacker has managed to install a sniffer on their company's network, so all internal services should use encryption, and the network must be vetted by an independent security organization.
This will also help against the threat of an internal employee gone bad. Whether it's intellectual property, pricing information, or confidential customer and employee data, more organizations have suffered from data theft due to the deliberate actions of their own employees than from outside hackers.
2. Governance and compliance failure
Commerce in the information age has introduced a multitude of regulations that can threaten a CIO career path. Whether it's the Sarbanes-Oxley Act, which ensures the accuracy of financial reporting, or GDPR, which protects consumer data, businesses face a plethora of regulatory requirements that inevitably require IT systems to manage.
In some industries, the number and diversity of regulatory mandates has been known to cause compliance fatigue, where people start getting sloppy about compliance as the volume of requirements increases. Compliance failures can not only result in a CIO's dismissal, but they can also cause enterprise-threatening damage due to big fines, lawsuits and even criminal prosecution.
Just as damaging are failures in governance, where there are no systems in place to track and enforce a company's internal policies. A perfect example is the public embarrassment Facebook had to deal with during the 2013 Cambridge Analytica scandal. The result for Facebook was a big hit to its reputation and erosion of trust as consumers left the platform in droves. Following its Q2 2018 earnings call, the company's stock plunged, erasing $150 billion of its market value in 90 minutes.
Managing governance and compliance manually is impossible. CIOs must build compliance into business processes and the software tools used to automate and manage them.
3. Performance failure: Misplaced priorities and misaligned expectations
About 10 years ago, a much-cited survey found that 23% of CIOs lost their jobs because of poor performance. Does that mean one in four of the people who climbed to the peak of the technical ladder were horrible at their jobs? No. It didn't then and it doesn't now. The problem is that IT projects become misaligned with business goals or business leaders change project requirements faster than IT can adapt.
More than one CIO career path has been damaged by a poor performance rating after the IT department completed a major project that was successful from an IT perspective. CIOs can complete a deployment on time, on budget and with everything that the business leaders asked for but still suffer a project failure. Many times, the problem is that once business leaders began using a new IT product, they come up with a whole new set of requirements, which can lead to a complete rewrite of customizations. This can cause overruns in both time and cost, which inevitably get blamed on the IT department.
A solution for this type of failure is no-code platforms, which make it easy to build highly customized products that manage enterprise data and support custom workflows, dashboards and business rules. The key advantage of no-code platforms is that they can be reconfigured to reflect user feedback and changing requirements in a matter of days -- or even hours. It is now possible to build full business enterprise platforms without writing a single line of code.
No-code platforms are not yet suitable for all requirements, but where they are applicable, they can provide true business agility.
4. Major project failure
The fourth reason CIOs are often fired is the more traditional failure of a high-profile IT initiative. An example of a major project failure is the Healthcare.gov fiasco, which almost sunk the Affordable Care Act before it got off the ground.
The healthcare enrollment portal cost $1.7 billion to build despite having an initial budget of less than $100 million. For the first few weeks after the launch, users could not even sign up, which made them understandably furious. A host of ongoing problems included leaving personal data vulnerable, a big roadblock to executing one of the Obama administration's signature policy initiatives.
While it may not be realistic to nail down every detail of a large deployment in advance, it is possible to structure a solid implementation plan with spec development and deployment milestones that assign responsibility and uncover obstacles well in advance of the point of no return. The plan should also hold the team accountable for maintaining budget and schedule discipline. Additionally, using an iterative design approach can give teams the agility they need to respond quickly to changing circumstances.
Vendors are fond of making promises, and their salespeople always sound confident. Ask them to back up those words with a money-back satisfaction guarantee that covers both the software and the implementation. The point is not about getting a refund, it is that the vendors willing to make this commitment will give you an accurate implementation estimate and are genuinely confident that they can deliver.
5. System collapses and disaster recovery failures
The fifth most common reason CIO career paths go south is a complete system failure and, more importantly, botched disaster recovery. Complete system collapses are rare, but when they occur, the consequences can be dire. To avoid outages due to high loads, systems must be scalable to several multiples of the anticipated loads and fully redundant.
But redundancy alone is not enough. For example, what would happen if a data center was destroyed by a fire or earthquake or if its system administrator ran a command that deleted all the data? That is why Gartner recommends replicating to a slave server at least 500 miles away.
Of course, it is not enough just to have those systems in place. They must be actively tested by simulating a disaster and testing the procedures to restore a working environment. Additionally, with geographically distributed server redundancy and 99.9% uptime guarantees, CIOs can ensure flexible, scalable solutions that meet a company's growing needs and that can guarantee they will never suffer catastrophic data loss.
While today's CIOs' responsibilities are increasingly strategic to drive change, they are also expected to deploy IT projects at the speed of business. This only increases the ways CIOs can get fired. But these five most common threats to CIO careers can be mitigated with a mix of the right technologies and business strategies.