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Digging Deeper Into Best Practices
As we can see from the Hackett generalizations, they are essentially based on what CEOs are doing and what they have experienced. Unfortunately this survey addresses little about what CEOs know and exactly what their role should be with respect to overall management, participations, and learning of technology. These "best practices" are particularly lacking in the area of organizational learning and the firm's abilities to respond to changing conditions as opposed to searching for general solutions. Let's look at each of these generalizations and discuss what they lack in terms of management and learning.
CIO Direct Reporting to the CEO
The fact that more CIOs are reporting directly to the CEO shows an escalation of their importance. But what is more relevant as a best practice is what that relationship is about. Some report about how often they meet. What is more important is the content of the interactions. What should the CEO know, how should they conduct themselves? What management and learning techniques do they apply? How do they measure results? My CEO interview research exposed the fact that many CEOs simply did not know what they needed to do to better manage the CIO and what they needed to know in general about technology.
Outsourcing
Outsourcing can be a very tricky endeavor. In my previous articles, I introduced the concept of technology as a Driver and a Supporter. I presented a model that shows how emerging technologies are initially Drivers, and need to be evaluated and measured using similar models embraced by marketing-oriented communities. I then showed how through maturation emerging technologies become Supporters, behaving more as a commodity within the organization. I explained that only then can a technology be considered for outsourcing because Supporter operations are measured by their economies of scale, reduced costs, increased productivity, or both (efficiency). The figure below shows that cycle:
Thus, what is missing from the survey information is the knowledge of where such technologies were with respect to the above technology life cycle. Knowing this dramatically affects what the CEO should be expecting, and what organizational learning concepts and factors they should be considering when managing technology.
Centralization versus Decentralization of IT
The entire question of how IT should or should not be organized must be based on a business that implements Responsive Organizational Dynamism (ROD). ROD includes the component called Cultural Assimilation that provides a process, using organizational learning that can help businesses to determine the best IT structure. To simply assume that centralizing operations saves money is far too narrow; the organization may need to spend more money on a specific technology in the short-term to get long-term benefits. Where is this included in the best practices formula? My research has shown that more mature uses of technology in organizations require more decentralization of IT personnel within the business units.
CIO needs Advanced Degrees
I am not sure that anyone could ever disagree with the value of advanced degrees. Nevertheless, the survey failed to provide content on what type of degree would be most appropriate. It also neglects to address the issue of what may need to be learned at the undergraduate level. Finally, what forms of education should be provided on the job? What exactly are the shortfalls that CIOs need to know about business? And equally important is the consideration over what education and learning is needed by CEOs and whether should they be so dependent on advice from their CIO.
Need for Standards
The need for standards is something that most organizations would support. Yet many case studies show us that too much control and standardization can prove ineffective. For example, allowing departments to use technology specific to their business as long as it can be supported locally. The real challenge is to have CEOs who understand the complexity of IT standards. They also need to be cognizant that standards might be limited to their specific organization's structure, its business, and geographical locations.
Risk Management
The survey suggests that CEOs need to support risk management because their backup-recovery procedures may be inadequate. The question to raise is whether the problem stems from a lack of support or from a lack of knowledge about the topic? Is this something that the chief IT executive needs to know, or is it just about the CEO's unwillingness to spend enough funds? The best practice component of risk management must be broader and answer these questions.
Next: The CEO's View on IT Best Practices
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