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5/17/2012
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Hybrid CIOs: The Future Of SMB IT?

David Hemendinger is both COO and CIO of the midmarket firm Summer Infant--and likes it. Here's why he thinks a hybrid COO/CIO/CTO role will become an increasingly common IT strategy at SMBs.

2012 Salary Survey: 12 Career Insights
2012 Salary Survey: 12 Career Insights
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It's common for small and midsize business (SMB) employees to juggle responsibilities well beyond their actual job descriptions. They often do so out of necessity--with fewer people to get things done, flexibility is essential.

Some people might reluctantly fill two (or more) roles because they don't really have another choice. Not David Hemendinger: He's both CIO and COO at Summer Infant, but he's not keeping a seat warm for a new executive hire. Rather, he sees the double-position as a smart business and IT strategy for the publicly traded mid-market firm, which has 240 employees. He also believes it's the natural evolution of the traditional CIO or CTO role.

"At least in my peer group, we've been drawn into the whole business aspect. We know a lot more about finance than we ever knew prior," Hemendinger said in an interview. (In fact, he recommends old-school IT executives prioritize finance books on their summer reading lists.) "You wouldn't make it two minutes in most of these types of companies if all you did was focus on technology."

[ When career paths go awry: read 10 CIOs: Career Decisions I'd Do Over. ]

That's something Hemendinger thinks his peers should embrace. Among other reasons, the shift might occur whether you're on board or not. "If you think about it, in most organizations the CIO and the CTO probably know more about the operations than some of the people in those departments that run those operations," Hemendinger said. "What's been really cool for me in this position is that I've been able to take that technology background and apply that to the operations side as well."

Hemendinger expects such departmental mash-ups to become a bigger trend, particularly at SMBs. (Indeed, here's a 600-person company where the CIO is also the CFO.) He points out that "most organizations at this size [have] a hard time trying to find truly qualified people that not only understand technology but what it takes for a small, midcap business to survive these days." More importantly, Hemendinger has found clear-cut advantages in the hybrid role that would not have been possible--or at least would have been much slower to materialize--had operations and technology been separate departments under separate leadership. That's often the results of applying technology solutions to operational problems, without a lot of unnecessary red tape.

An example: When Hemendinger took the job--pardon me, jobs--he quickly realized that one of Summer Infant's necessary business processes was creating a major resource drain. The company makes a wide range of baby products, and it does a ton of retail analysis. That includes sending employees into stores such as Babies R Us to gather competitive intelligence about pricing, product placement, and a mass of other data.

"It's extremely valuable to us in our market, but it's also extremely time-consuming and inefficient and requires a lot of feet on the ground," Hemendinger said. In fact, there are five or six pairs of feet doing the work in painfully manual fashion: "This was all they did, and when I saw the way they were doing it, I thought 'oh wow, we can re-engineer this really fast.'" They deployed a mix of tablets, laptops, Dragon voice-dictation technology, and handheld wireless barcode readers to streamline and automate much of the data capture and subsequent documentation processes. Deployment happened "very quickly"--Hemendinger just joined the company last November--and he credits that to the combined technology and operations department.

He sees other upsides in the COO/CIO approach, including easier systems integration, potential cost savings, and less corporate bureaucracy. The latter often is an area where SMBs can gain an upper hand on larger competitors. On the integration front, Summer Infant had previously not given much thought to connecting critical systems. "The focus was trying to make each one of those best-of-breed from a departmental level," he said, rather than applying an "enterprise mentality" to ensure optimal performance. Since subsequently integrating Summer Infant's ERP, sales forecasting, and warehouse systems, sales forecast accuracy has increased 2%. "That's tremendous," Hemendinger said.

There are potential downsides to the hybrid tech exec. Hemendinger said a company could outgrow the double-role, to the point where there's simply more work than one person can reasonably get done. (InformationWeek Editor Chris Murphy recently took a look at a similar phenomenon inside larger enterprises.) Another risk comes with any situation where the person holds two titles in name only, but isn't truly granted the information and authority needed to get both jobs done. That's a recipe for failure.

"Let's say that they're not truly given the opportunity to fully understand all of the aspects of both the IT side of it and the operational side of it," Hemendinger said. "They need to be in control of both. If you don't have the empowerment to drive both, I think the job gets very sticky, very quickly."

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