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CDOs Replace CIOs? I'm Not Buying It

Marketing-minded chief digital officers aren't technical enough to lead the changes that companies need to make.

There's nothing like a provocative analyst prediction to get people talking. Several years ago, it was Gartner's prediction that marketing organizations will outspend IT organizations on technology by 2017. Not to be outdone, the provocateurs at IDC last week weighed in with their own headline-grabber: By 2020, chief digital officers (CDOs) will "supplant" 60% of CIOs at global companies "for the delivery of IT-enabled products and digital services."

In other words, most CIOs -- if the position still exists at their companies in five years -- will be relegated mostly to managing and securing infrastructure and applications, according to the IDC prediction, one of 10 that the research firm laid out as 2014 comes to a close. CDOs, meantime, will take on the more strategic (and fun) role of applying digital technologies -- mobile, cloud, analytics, social, robotics -- to boost revenue, maximize profits, and delight customers. CIOs = back office. CDOs = front office. It's 1989 all over again.

Here's my prediction: By 2020, chief digital officers will be yesterday's fad, joining the ranks of chief innovation, learning, and culture officers. Sure, a handful of them will still exist, but the CIO -- customer-focused and product-savvy -- will drive the corporate digital agenda in partnership with CEOs, CMOs, CFOs, and other business leaders. CIOs won't go back to being order-takers. "What good CIO would let that happen?" says Cathy Bessant, head of Bank of America's 100,000-person Global Technology and Operations unit, which includes six or seven CIOs.

[No need to worry, CIOs: GE CEO Talks Economy, CIOs & Tech.]

Those CIOs who can't cut it as digital innovators and customer pleasers will go the way of CFOs who can't think outside of their spreadsheets and CMOs who can't move beyond direct-mail marketing and banner ads. That is, they'll lose their jobs because of their failure to keep up with the times and corporate priorities.

But that doesn't mean roughly 60% of current technology chiefs aren't up to the challenge of leading the next great technology movement. You can already size up the CIO of tomorrow by looking at the top CIOs of today -- the likes of Rob Carter at FedEx, Lynden Tennison at Union Pacific, John Halamka at Beth Israel Deaconess Medical Center, Karenann Terrell at Wal-Mart, and Gordon Wishon at Arizona State University -- all technically astute, customer-focused, business savvy. They're not MIS chiefs; they're strategists.

Getting to that level isn't a bridge too far even for CIOs who today may be spending too much of their time in the weeds. In a recent Gartner survey of more than 2,800 CIOs in 84 countries, 73% of respondents said they have changed their leadership style over the last three years, and 75% said they need to change their style over the next three years, to meet the demands of digital business. "The exciting news for CIOs," Gartner maintains, "is that despite the rise of roles such as the chief digital officer, they are not doomed to be an observer of the digital revolution."

Not only do most marketing-bred CDOs lack the technical expertise to lead the digital charge, but they also lack the project management experience, says Satya Ramaswamy, head of the Digital Enterprise unit of Tata Consultancy Services. "We are not seeing CIOs going away at all," Ramaswamy says. Especially at large scale, "digital reimagination," as he calls it, "is too complex for someone with a marketing background. There's so much going on the back end to drive the front." The two aren't separable.

Despite its optimism about the future role of the CIO, Gartner issued a warning: "Through both nature and nurture, CIOs have evolved into control-style pragmatic leaders," Gartner VP Graham Waller said in a statement. "Given the characteristics of the new digital era, this bias is dangerous. CIOs must invert their style to be more vision-led and inspirational."

Bank of America's Bessant, a former company CMO in her own right, says CIOs do need to adopt the mindset of "thinking digital first, digital by design."

"I can see the cultural revolution that we've got to have," she says. "But good/great technologists are awesome problem-solvers and have the ability to see the future. Shame on any CIO who can't see that coming."

If the world wasn't changing, we might continue to view IT purely as a service organization, and ITSM might be the most important focus for IT leaders. But it's not, it isn't and it won't be -- at least not in its present form. Get the Research: Beyond IT Service Management report today. (Free registration required.)