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Why Don't More CIOs Become CEO?
jcatcw writes "Thornton May is mystified by the very small number of Fortune 500 companies that led by former CIOs. "Knowing what we know about CIOs — that is, that most are smart, hardworking, supremely aware of how the business works and increasingly savvy regarding the workings of external customers' minds — the failure of more CIOs to become CEO has to be one of the biggest mysteries of our age.""
As long as board members are choosen from the non-technical, management side, those same board members will pick non-technical peopel to head their company.
excitingthingstodo.blogspot.com
Given that most CEO's come from a financial background (accounting), and the position of CEO typically mandates this knowledge, it's probably one good reason why the transition to CEO from CIO is not as less common than from other positions.
For he today that sheds his blood with me shall be my brother.
Most CEOs are former SALESMEN. Check out their careers. You'll see that most, if not all, were in Sales or Marketing at one or more points in their careers.
Boards NEED someone at the top of the company who understands what Sales and Marketing NEED. After all, no matter how superior your product is *cough*betamax*cough* if it does not sell, your company goes down the tubes. Not the internet tubes, the other kind.
No big conspiracy here. Just boards doing what they have always done.
We have always been at war with Eurasia!
The CIO is basically the manager of a technical function. The CEO probably got to be the CEO by being very good at back room politics and perhaps by being a bit psychopathic. In a fight between the CEO and the CIO, the fight is over before the CIO knows there is a fight. It is beyond naive to think that a CEO got to that position merely by being a really good manager.
Most board members are chosen by the CEO. So, chances are excellent they don't want to report to an underling at the board meeting.
One of the major misconceptions most people have is they assume "the board" keeps the CEO in line. That's the exception, not the rule. It's a club people.
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
"Knowing what we know about CIOs -- that is, that most are smart, hardworking, supremely aware of how the business works and increasingly savvy regarding the workings of external customers' minds -- the failure of more CIOs to become CEO has to be one of the biggest mysteries of our age."
I don't really see it that way. Unlike the CEO, CFO, President, board members, etc., the CIO's focus is internal rather than external. The CIO's "customer" is generally his or her own company itself. Why would a company risk promoting someone who's focus is inward-looking into a position where they have to look outwards as well?
The job of a CIO is to paint an honest and true picture grounded firmly in reality, and protect it from those who would engage in wishful thinking. The person who becomes a CIO is the person who has made it their lifes work to operate in this mode, and achieved the trust and respect of their peers by their effectiveness in doing so.
The job of a CEO is to paint a glowing and radiant picture firmly grounded in the hopes and dreams of investors, and protect it from those who would engage in critical thinking. The person who becomes a CEO is the person who has made it their lifes work to understand what others want and convince them it is just around the next bend, thus eliciting their ongoing co-operation.
Someone who has forged themselves into CIO material is most likely not going to be very good or happy at the CEO job for that reason. They require different personality strengths.
I often contemplate how we as a society can structure things so the guy who is telling the truth is a more effective organizational representative than the guy who likes to spin lies and half-truths. No answers yet..
-1 Uncomfortable Truth
I'd rather choose a person who know business than one who knows computers to lead a company. True, a LOT of businessmen are incompetent and don't know squat about anything, but at the end of the day you have to see a business through a businessperson's eyes. That means taking into account issues which might not be regularly considered by other experts.
Look, I'm a computer guy and I despise the fact that many people cannot understand the difficulties in my profession, but I do know that you have to get your shit straight to negotiate with salesmen, accountants, and clients, while projecting the ideas of a company and making sure that all specialties within a company are working fine. Like computer professions, business has aspects that are more art than science, and talented people can squeeze it for all its worth.
The two most likely answers for all of this kind of question are:
Because {X} don't want to.
Because {X} didn't contain enough individuals with the correct aptitude.
In this case (rarely enough) there is a plausible third answer:
Because finance directors know where the skeletons are buried and sales directors put them there in the first place.
But I'm still betting that nearly 100% of the reason is caused by the first two generic points.
Beep beep.
When I'm in meetings with CEOS, bankers, "investors" and other purely "business" people, with no production merit, they usually roll their eyes whenever someone mentions something technical, or even just relating directly to the technology, as if it were important to the business. These businesspeople have social skills, even if limited to boardroom power games, and sometimes technical skills in finance, marketing, or the law. But they never let their own "techinical" skills or jargon show in these meetings with "outsiders". They have instead learned to dumb down their expertise to talk purely colloquially with nontechnical people.
Pure technologists rarely learn to dumb down like that. Partly because the knowledge itself is the most valuable, not the person who has it. Partly because tech is a language itself, which suffers from obfuscation and euphamism. So do the other technical communications, like finance and management, but those execs have long ago learned to ignore the imprecision and downright coverups, unless they feel their own power directly threatened by it.
CIOs are much more like other execs than like other technologists. The most successful ones are those least competent in tech itself, preferring instead to work on social competence like the rest of the execs with whom they deal. But the other execs still don't trust the CIOs, because they are still more likely to tell the truth about the core business, or just something else the rest of the execs don't understand, which would make the majority of the power holders look bad.
Eventually CIOs will become as disconnected from the technology and its culture as are the rest of the execs from wherever they draw their power. Then CIOs will become CEOs more often, like CFOs and CMOs (though marketing execs hide their pedigree for exactly the opposite reason, confirming the duplicity). Eventually no one will know what they're talking about when they spout expertise, but they will know each other very well. CIOs will win, and the products, the company, and the customers will all lose.
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make install -not war
Of course it's their loss. Those companies that are a bit more insightful and can see what a CIO/CTO can bring to the table, will be better off for it.
the best CEO's seem to be former sales people. They can promote the company and aren't shy about asking customers for money. Many CIO's lack extensive P&L experience as IT, in most companies, is a cost center. Without that critical P&L experience, making the transition to CEO, especially at the Global 2000 level is difficult.
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
. . .the CEO is #1 on the blame list when something goes wrong.
And gets punished with an $80 million severance package and a lateral move to another CEO position.
KFG
Do you actually know any CEOs? I mean personally? I interact with just a few of them from time to time and the ones I know are not lazy or stupid. In my experience they work very hard. It is just that they devote a good deal to things you don't find value in (climbing the corporate ladder). The ones I deal with are also accutely aware of the business they are in and don't disregard the customer. Again it is a mixed bag. You have to remember that they are supposed to maximize profits for the company. Yes I think everyone here would agree that one good step is to produce a good product, but just because you can find some flaw or something that you don't like doesn't mean the CEO is stupid or lazy. A lot of it comes down to compromise between the many forces at work in business.
GENERATION 27: The first time you see this, copy it into your sig on any forum and add 1 to the generation.
Exactly. Most CEO's are preeminently salesmen, an activity which definitely has distinct personality characteristics. These are not at all the standout personality characteristics of good CIO's.
Politicans are there to fill a role we as society asked them to fill by creating it, wielding power we gave them by our continued participation.
Part of the answer involves making them obsolete as a role.
The general idea I have is to:
a) allow people to vote on every issue if they wish, and give them the necessary transparency of process to allow them to do so to the best of their abilities.
b) allow people to delegate their vote to anyone they trust, not just those who signed up on the ballot.
c) allow those who have votes delegated to them (ie they were voted for) to cast their vote on issues the same way before, but add the weight of their personal electorate to their votes.
d) allow people to revoke their vote for a person any time they feel their values are being betrayed by those they elected, allowing them to either cast it themselves or re-assigning it to someone else.
This deals with the two major issues facing modern democratic process:
1) Sometimes there's no one to vote for that you trust but they get to speak for you anyways regardless of if you vote or not.
2) Sometimes the person you voted for betrays you and you have no way to remove from them the power of your support for several years without overthrowing the system.
Like I said... I'm still working on it...
-1 Uncomfortable Truth
CEO's (should be) are outward focused. They steer the ship where, if they are correct, it is supposed to be to return the most value, blah blah. That's their job and their responsibility. It's not just about the product, but also about regulatory and personnel issues, accounting, and competition, all significant hazards to be avoided. Yes, of course it's about "the customer," but not in the belly-button staring sense most customers think. "The customer is always right" means the customer knows what he or she wants to buy (including services and treatment) therefore the corporation must produce products and services and treatment that the customer will buy in advance of their doing so, in the hopes that they will, e.g. iPhone.
The CIO, on the other hand, is very inward focused or, if recently enlightened, certainly has an inward focused background. It's about code and deadlines and infrastructure support. These are the guys who oil the pumps and valves that keep that whonking 100,000 HP steam engine in the bowels of the ship working. They don't stear the ship. They don't decide where it's going to go. They don't even have to know the mission. They are responsible for making sure it gets there in good shape. In many cases, they don't even have time to go above deck and look outside.
It is very rare for an engineering officer to make Admiral, even rarer for a supply officer or personnel officer, or, for that matter, a medical officer or JAG. These are all support roles, and if you've done your homework, you KNOW THAT IN ADVANCE. Admirals come from the surface warfare officer community or, in the case of carriers, through the aviation route. It's the same in the army: Schwarzkopf was an Infantry Officer, not a technician, who, incidentally, in the lower ranks is ALWAYS subservient to an infantryman of the same rank.
If a potential CIO is interested in doing the CEO thing, the best thing for him or her to do is make sure he or she gains significant experience outside the CIO ladder. A significant stint in accounting, personnel, or an "assistant to the CEO" type position will show significantly in the bid to become CEO. Narrowly focusing on just IT will never get you to the Board Room.
I know many of you don't like this. From an idealistic point of view, it's "wrong." because, as anyone here knows, IT people are the smartest, sharpest people ever to walk the planet who KNOW how the world works, REALLY. They deserve to become CEO, and if they don't, there's something wrong with the system, not them, and certainly not their attitude. But as a Board Member (or head hunter) I'm not really interested in whether you know C++ or even if you have managed to keep the servers online 24x7. (Can you imagine a bid for CEO: "I know C++ and Open Source is the way to go and Linux is cool and Bill Gates is an idiot capitalist pig dog.") The fact that you are a proven manager of infrastructure issues is great. That's what is expected of you. Keep doing that. Swap out my PC any time you want. But I want someone who knows precisely where the ship is going for CEO.
The bottom line is that there's a heirarchy out there that exists in every walk of life. Laws to fix heirarchy are artificial; the heirarchy is still there. If you are not the CEO then either you didn't want to be (not always a bad thing?) or you screwed up in your perception of what was necessary to get you there. Whining about it is not going to "fix" anything. Perhaps a little introspection will.
How about a moderation of -1 pedantic.
Same reason why the mail boy will never be CEO...
Well, there's David Geffen, but he's kinda unique; and moved from mailboy to sales to founder.
The American dream is a lie
Well yeah, the current version of working hard to qualify for a mortgage on a cardboard and foam "house" full of rubbish and hanging on until you can qualify for a reverse mortgage and then all of your dreams of money, power and glory will come true in your "golden years" is a lie.
And a very useful one to a handful of people for whom you spend your life working.
However, remember that the original American Dream, the one that brought the immigrants here in droves, was simply to own your land, outright, on which you were secure legally, literally your home being your castle and your lands your estate, and from which you could wrest your own living.
This was in contrast to the conditions from which the immigrants came; that of being a serf or tenant farmer with no property and no rights. Simply owning a piece of real property was, to them, a leap from the bottom of the social order to the top, no matter how poor they were.
There was some truth to this dream.
On the other hand their were always speculators and lawyers hanging around to fuck you out of it, so there has always been a measure of the lie to it.
KFG
You seem to be under the mistaken impression that there are many corporations where the chairman and ceo are separate.
Furthermore:
1. The shares of stock in a corporation that have the ability to vote is usually a separate class of stock. Please examine your stock certificates carefully!
2. Major chunks of voting blocks of stock are held by select few in the average corporation. General meetings are practically meaningless.
3. Corporate charters typically forbid the collection of more than a meaningless block of voting shares. Certainly not enough to control a seat on a board.
4. Finally, a corporation that actually would cede control to public markets is the surest sign of an imminent valuation death spiral. This is one reason insider trading is followed so closely.
Textbook examples of corporate governance are that. They have nothing to do with real life. Sadly, you and the moderators believe that's how it actually works.
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html