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August 12, 1999

The New CIOs

Challenges in E-business and greater influence in the boardroom are fueling quick turnover

By Jennifer Mateyaschuk and Ramin P. Jaleshgari

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ive CIOs have left their jobs in the past three weeks to join new companies-all vacating positions they had held for less than two years. The departures signal a higher churn rate among senior IT executives, who are being lured by new challenges in electronic business and greater influence in company decision-making. They also present potential problems for the companies CIOs leave behind.

The latest CIO to exit his post is Maynard Webb, who last week left Gateway Inc. after just one year as CIO to join online trading company eBay Inc. as president of eBay Technologies. Not long before, Ken Harris, CIO at Nike Corp., resigned after 16 months to take the top IT spot at Gap Inc., where he will play an important role in guiding the apparel company's retail Internet initiatives, among other IT projects. The move triggered a noncompete lawsuit by Nike and a countersuit by Gap.

Also this month, David Starr ended his 14-month reign as CIO of Knight Ridder, where he managed a supply-chain initiative, to head the expansion of 3Com Corp.'s global IS and E-commerce operations. David Dengler departed services firm Keane Inc. after 20 months as CIO to become the IT chief of consulting firm Renaissance Worldwide, where he will lead initiatives including E-business, enterprise resource planning, and knowledge management. And Robert Napier, CIO for one year at Mariners Post-Acute Systems, became Compaq's CIO; his responsibilities include supporting the company's E-commerce development.

The turnover rate runs counter to a trend in which CIOs had been staying in their jobs longer. "In the last six months, there's been a dramatic increase in the instability of CIO positions," says Karen Rubenstrunck, VP and service director of the Meta Group's CIO practice.

A survey earlier this year by InformationWeek Research indicated that the median stay for a CIO is seven years. Indeed, until recently, CIO tenure had been gradually increasing during the past several years, says Dean McMann, president of the Randsford Group, an executive search firm. But that's changing, McMann says, as some of the same factors causing churn in other IT positions-including a high demand for professionals with both business and IT skills, and increasingly attractive compensation packages-cause CIOs to rethink their career options. "The need for folks with my kind of background is pretty frantic," says Webb.

Even CIOs who have demonstrated longer-term commitments to their companies are feeling the pull. Bud Mathaisel, CIO at Ford Motor Co. for the past eight years, this month joined Solectron Corp., where he'll head the IT organization and advance the company's E-commerce activities.

Among those making the move,there's a strong desire to get their hands on E-commerce and their opinions into the boardroom. For Webb, eBay promises both. "The chance to be part of the new digital economy at an industry leader was too good to pass up," Webb says. "eBay truly leverages all the technology and enables a new economic model. I'll be part of the very small inner circle that's setting the plans moving forward."

Webb will have his work cut out. His new employer's technology infrastructure has shown the strain of the company's rapid growth-its Web site has experienced several lengthy and costly outages, including a 14-hour breakdown on Aug. 6. And what about the job he's leaving behind? Webb says the decision to leave Gateway after just a year wasn't easy-his goal was to stay a few years. "It was a difficult decision to break my own rules about how long I wanted to stay," he says.

Dengler's decision to leave Keane was more pragmatic. "Companies have changed dramatically because of Internet technologies, which has given CIOs more opportunities to move into positions where they can make a significant contribution to the business," he says. "After that contribution is made, CIOs have the option to move to bigger and better things" at another company.

Dengler exercised that option in moving to Renaissance Worldwide. After revamping Keane's IT infrastructure and setting in motion a plan to equip consultants with new desktop systems and a unified

E-mail system, Dengler says he felt he could make a more significant contribution at Renaissance, where he'll be involved in all business and IT strategy, including E-commerce initiatives. "E-commerce is definitely a contributing factor to a CIO's decision to move," he says. "Any company that wants to continue to do business has to press forward aggressively with an E-commerce strategy."

Higher Profile
Like Webb, Dengler is raising his profile in the ranks of top management. Dengler wasn't on the executive committee at Keane; at Renaissance Worldwide, he is. "By being a member of the executive committee, I'll be involved in all strategy discussions," he says. "I'll have more insight into where and how technology can be deployed here, rather than learning about strategies after they've been made and implementing technology when I don't know the thoughts and processes that went into the planning."

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