Silicon ceiling: why aren’t more CIOs becoming CEOs?
CIOs are wielding more strategic influence than ever before, yet relatively few go on to lead their businesses. What’s hindering them from becoming CEOs?
The role of the CIO is evolving. Historically pigeonholed as ‘tech bods’, CIOs are making high-value contributions that are often inseparable from their companies’ wider business strategies.
It’s natural to wonder what’s next for them as their work becomes ever more pivotal: given their growing influence as strategic decision-makers, surely there’s a strong case for more of today’s CIOs to become tomorrow’s CEOs? While those in the top job typically emerge from the operations and finance functions, are there qualities that are unique to CIOs that could strengthen their leadership credentials?
“The people overseeing the data and technology strategy in a company make good candidates to be its next CEO. But it is not their technology or data analytics skills in isolation that are important,” stresses James Berry, lecturer and director of the MBA programme at University College London School of Management. “A good CEO will not only understand the function and potential of technologies; they will also have a broad enough understanding of the wider business to know how the data produced by those technologies will be used by the organisation’s core functions.”
There is no denying that relatively few CIOs become CEOs, especially outside the tech industry. One reason could be that the CIO’s realm of expertise may not be broad enough. A commonly held view is that CIOs don’t get as much exposure as most of their C-level colleagues do to other key functions in the business, which is seen as a necessary precursor to gaining the top job.
Jon Faulkner is the founder and CEO of design consultancy 6bythree Digital, but was previously CIO at the London School of Hygiene and Tropical Medicine. He suggests that entrenched attitudes about what someone who’s come up through the IT function can bring to the party are hindering the further progress of CIOs.
“I’ve had many IT leadership roles,” Faulkner says. “But there was a general belief that, because of my technical background, I didn’t have all the right skills for stepping up to a broader role as a CEO (or even COO). I’ve since gone on to set up and grow two digital agencies. I now have full accountability, covering finance, sales, marketing, general management, leadership and our delivery of strategy and consulting services.”
He continues: “CIOs absolutely do have the right skills to step up, as they will invariably have significant financial responsibilities, albeit perhaps not full profit and loss. A CIO is continually engaging in partnerships, both internal and external, and developing collaborative solutions that reduce operational friction and align with their organisation’s immediate needs and future direction.”
Danny Reeves is another former CIO who’s moved up to the top job. Having served as CIO and director of client services at construction giant Balfour Beatty, he is now CEO of data management company Exonar. He argues that CIOs should be gaining all the skills they require to become CEO in the course of their role.
While Reeves believes that “being a good CIO does not necessarily make you a good CEO, you do experience the complexities of people, operations, marketing and sales (usually to internal stakeholders) and budgets, all of which lead well to the CEO’s role. For me, the most important skills are managing people and developing inclusive and positive cultures. That’s the same whether you’re navigating the twists and turns of startup life or dealing with corporate complexity.”
Caroline Sands is a partner at executive search company Odgers Berndtson, where she heads the CIO and technology officers practice. Drawing on her experience of working with firms to appoint former IT chiefs to CEO positions, she says that the pandemic-induced uptick in digital transformations has “led to a new appreciation for the skills that CIOs can apply holistically to organisations”.
Sands observes that the strong appetite among corporate boards for digital transformation has “necessitated the appointment of leaders with a deep understanding of enterprise technology. In some cases, this appetite has been voracious and has required leaders who understand when budgets should be allocated to technology projects, just as much as when they should not. It’s making a compelling case for CIOs stepping up as CEOs.”
But are they fully equipped to handle some of the other demands of the top job? Sands argues that, while they may be focused on technology, CIOs are still functional leaders. This gives them a good grounding for taking certain strategic initiatives from their CEOs.
Such assignments might include “leading on a firm’s inclusion and diversity strategy, its approach to sustainability, or the cultural aspects of a digital transformation”, she says. “In an ecommerce or B2C business, for example, CIOs may also have the opportunity to get involved in product development.”
Sands continues: “We often advise CIOs to seek ways of showcasing their strategic skills. Such opportunities commonly include turning around a failing business unit and bringing a new product or service to market. Technology underpins almost every aspect of a business, which means that there’s plenty of scope for a CIO to gain broad leadership experience.”
Offering a different perspective, Matt Cockbill, managing partner of the IT and digital leadership practice at Berwick Partners (part of the Odgers Berndtson group) questions why CIOs would feel a strong need to seek out the top job.
“They are capable and ambitious people who have a box seat at the forefront of the future of work,” he says. “Where they may have gone down the CEO/COO path in the past as they outgrew an inward-looking role, today’s CIOs are adept leaders with the capacity to add value to colleagues and customers. Undoubtedly, some will continue exploring that path. But, where businesses are utilising the ever more dextrous leadership skills of their CIOs, enabling them to broaden their role and maximise their contribution, why would someone in that role change lanes?”
The increasing pace of digital transformation has put CIOs in a unique and elevated position. As Sands notes, they have been required to “build bridges between disparate business units; ‘sell the story’ of transformation to the whole business; and manage any cultural fallout caused by the implementation of new technology. These tasks call for the fundamental skills of people management, communication and leadership that any CEO would need.”