“The 21st Century CIO” Mark Polansky Managing Director Information Technology Practice Korn/Ferry International Society for Information Management Philadelphia, Pennsylvania February 1, 2005

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The 21st Century CIO - Overview The historically changing role of the CIO Current thinking by top CIOs regarding planning for and achieving success – The 21st Century CIO Leadership Agenda The “Top 10” critical success factors for CIOs in today’s business environment An operating model for 21st Century CIOs Trends & the future of the CIO position

Evolution of the IT Leadership Role 1950s – Tab Supervisor Accounting automation Electro-mechanical equipment, early computers Reports to Accounting Manager

Evolution of the IT Leadership Role 1950s – Tab Supervisor 1960s – Data Processing Manager Proprietary systems - accounting, payroll, sales Batch mainframe computers Reports to Accounting Manager or Controller

Evolution of the IT Leadership Role 1950s – Tab Supervisor 1960s – Data Processing Manager 1970s – MIS Director A full array of business applications systems Online and database systems, minicomputers Reports to Controller or Chief Financial Officer

Evolution of the IT Leadership Role 1950s – Tab Supervisor 1960s – Data Processing Manager 1970s – MIS Director 1980s – Vice President of Information Systems Alignment of IT with business functions PCs and Local Area Networks, decentralization Reports to Chief Financial Officer

Evolution of the IT Leadership Role 1950s – Tab Supervisor 1960s – Data Processing Manager 1970s – MIS Director 1980s – Vice President of Information Systems 1990s – SVP/EVP & Chief Information Officer Enterprise integration, recentralization Client/server, Internet, ERP systems Reports to CEO/COO - senior management team

Evolution of the IT Leadership Role 1950s – Tab Supervisor 1960s – Data Processing Manager 1970s – MIS Director 1980s – Vice President of Information Systems 1990s – SVP/EVP & Chief Information Officer 2000s – ????

“The Changing Role of the CIO” Source: Korn/Ferry research in conjunction with The Financial Times, 1998 Shift from technical to strategic focus Stratification of IT leadership New qualifications and accountabilities Repositioning the CIO in the organization Reorientation from internal customers to external customers Recruiting, motivation, retention and evaluation

“Creating the CIO Executive Success Cycle” Source: Korn/Ferry joint study with Gartner EXP, 2001 CIO “Executive Leadership Agenda” Assess what must be done, garner support, ensure necessary resources to succeed Deliver business value and enterprise performance “Four Habits of Effective CIOs” Shape demand Set expectations Deliver Lead

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 IT Strategy – Business strategy alignment, business case and projected return on investments, priorities versus resources.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 IT Strategy – Business strategy alignment, business case and projected return on investments, priorities versus resources. IT Governance – Portfolio management, IT investment funding and review process, performance measurement, IT processes, project management (PMO), standards, procurement.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 IT Strategy – Business strategy alignment, business case and projected return on investments, priorities versus resources. IT Governance – Portfolio management, IT investment funding and review process, performance measurement, IT processes, project management (PMO), standards, procurement. IT Organization & Staffing – Centralized, decentralized, federal model, shared services; reporting relationships, FTEs, staff augmentation, on/near/off-shore, capability/maturity, training.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 IT Strategy – Business strategy alignment, business case and projected return on investments, priorities versus resources. IT Governance – Portfolio management, IT investment funding and review process, performance measurement, IT processes, project management (PMO), standards, procurement. IT Organization & Staffing – Centralized, decentralized, federal model, shared services; reporting relationships, FTEs, staff augmentation, on/near/off-shore, capability/maturity, training. Technology – Architecture; bleeding/leading edge, or trailing; build or buy, suite or best-of-breed; infrastructure and networking insourced/outsourced, total cost of ownership (TCO), support.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 IT Strategy – Business strategy alignment, business case and projected return on investments, priorities versus resources. IT Governance – Portfolio management, IT investment funding and review process, performance measurement, IT processes, project management (PMO), standards, procurement. IT Organization & Staffing – Centralized, decentralized, federal model, shared services; reporting relationships, FTEs, staff augmentation, on/near/off-shore, capability/maturity, training. Technology – Architecture; bleeding/leading edge, or trailing; build or buy, suite or best-of-breed; infrastructure and networking insourced/outsourced, total cost of ownership (TCO), support. Technology Awareness – Board of Directors, senior and middle management, rank and file.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 6. Corporate Governance - Compliance & reporting, business continuity, security, privacy, intellectual property protection

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 6. Corporate Governance - Compliance & reporting, busines continuity, security, privacy, intellectual property protection. 7. Business Intelligence – Metrics, analytics, data warehousing.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 6. Corporate Governance - Compliance & reporting, business continuity, security, privacy, intellectual property protection. 7. Business Intelligence – Metrics, analytics, data warehousing. 8. ERP – Business integration & transformation, process improvement, value chain, quality program.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 6. Corporate Governance - Compliance & reporting, business continuity, security, privacy, intellectual property protection. 7. Business Intelligence – Metrics, analytics, data warehousing. 8. ERP – Business integration & transformation, process improvement, value chain, quality program. 9. Customer Care – Customer relationship management (CRM), contact centers, customer portals, B2B collaborative computing (CPFR).

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 6. Corporate Governance - Compliance & reporting, business continuity, security, privacy, intellectual property protection. 7. Business Intelligence – Metrics, analytics, data warehousing. 8. ERP – Business integration & transformation, process improvement, value chain, quality program. 9. Customer Care – Customer relationship management (CRM), contact centers, customer portals, B2B collaborative computing (CPFR). 10. Internet – e-business strategy, web-enabled applications, employee portal, telecommunications.

The 21st Century CIO Leadership Agenda Source: Korn/Ferry research, 2003 IT Strategy IT Governance IT Organization & Staffing Technology & Architecture Technology Awareness Corporate Governance Business Intelligence ERP/Business Transformation Customer Care Internet & e-Business

“The CIO Top 10” Source: Career Counsel, CIO Magazine 10. Hire, develop & retain quality technology professionals 9. International or global experience 8. Knowledge of or experience in a specific industry 7. Ability to create and manage change 6. Communication skills 5. Management skills 4. Relationship skills 3. Business savvy 2. Expertise in applying and leveraging technology for the advantage of the enterprise 1. LEADERSHIP

The 21st Century CIO ENABLER DRIVER SUPPORTER COST CUTTER Strategic “competitive” ENABLER DRIVER SUPPORTER COST CUTTER Tactical “operational” Reactive “following” Proactive “leading”

Current Trends Affecting the CIO Position Continued evolution of IT and the CIO & CTO roles Corporate CIOs - the federal model, recentralization Measuring the business value of IT investments/ROI Cost control and productivity: optimize middle line Competitive advantage: top line growth Governance, privacy, security, business continuity Business Intelligence Technology and business process outsourcing Ongoing development of the Internet and e-business Pervasive, ubiquitous technology, information & access

Evolution of the IT Leadership Role 1950s – Tab Supervisor 1960s – Data Processing Manager 1970s – MIS Director 1980s – Vice President of Information Systems 1990s – SVP/EVP & Chief Information Officer 2000s – ????

The 21st Century CIO – The Future 2000s – SVP/EVP & Chief Information Officer Title has reached its plateau Operating charter Strategic focus Governance of IT - “Office of the CIO” Management of a composite of resources Success criteria Value creation IT effectiveness IT Oversight Committee - Board of Directors Upward mobility to general management

“The 21st Century CIO” mark.polansky@kornferry.com