A couple of weeks ago, InformationWeek ran an interesting piece reporting on a Forrester Research survey. The crux of the survey is that CIOs tend to report to a lot of different people, including CEOs, CFOs, COOs and heads of business units.
It’s interesting that the chain of command differs according to the industry of the organization. In business services, for instance, 46 percent of CIOs report to the CEO. That percentage is down to 37 percent in financial service and 35 percent in manufacturing.
Though the numbers are interesting, the conclusion – that CIOs report to a bunch of different titles – isn’t surprising. The other interesting but not too surprising point is that the size of the IT budget tends to depend upon the line of reporting. The analyst who wrote the report suggested that CIOs who avoid reporting to CFOs tend to get bigger budgets. Again, interesting -- but not surprising.
There is an important area that is a natural follow-on to this report. Though it is harder to assess than the dollars and cents of budgets, it is vital: How do the various lines of reporting impact the communications that leads to decisions?
A different budget and different decision makers strongly suggests that a different process was used for determining that budget. Does a CIO reporting to a CFO have to state his or her case differently than if, for instance, the CEO or COO was the final arbiter? If so, just how does the conversation change? Is there one reporting relationship that produces better results for the organization? Is their a way to ensure that all the important questions originating from every quarter are posed to the CIO?
There are many important issues here. The key is that decisions – or lack of decisions – are not made in a vacuum. The smartest organizations will recognize that having as many voices heard will produce the best results, as long as it is done in a systematic manner.