Do You Need a CTO: Decision Factors

Technology companies hire chief technology officers to lead research into new products and projects. But should IT departments in non-technology companies consider hiring CTOs as well?

Mary E. Shacklett, President of Transworld Data

June 22, 2022

4 Min Read
illustration, business woman looking at using a telescope and standing somewhere. Look for opportunities from the business
Bobi Rival via Alamy Stock

From my experience as a CIO, I learned that a CTO is best deployed with a focus on new technology and technology architectural directions. The two CTOs I have worked with did not demonstrate much budget acumen and preferred that the “pencil pushing” be left to someone else.

Where the CTO was vital was in determining the architectural direction of our software, networks, and new technologies that we weren't using today, but should be considering in the future. With a CTO onboard, I breathed much easier because I knew there was someone with considerable technology expertise who was looking toward the future while we were focused on the present.

All my experience with CTOs, however, was at a commercial software company where technology was our end product. This made it easy to justify the hiring of an expensive CTO. But what about companies whose main business isn't technology? Should they be hiring CTOs?

From a budgetary standpoint, the answer is usually “no” -- unless your business is so tightly intertwined with technology that you can’t afford to be left behind. Industry sectors in this situation are healthcare, brokerage/stock trading, financial portfolio management, credit card services, and life sciences, to name a few.

However, that doesn't mean that non-technology companies should dismiss the idea of getting CTO input on technology directions.

If a company is going to successfully navigate technology shifts, it needs to know which up-and-coming technologies will be vital to the business, and where technology investments should made.

Major technology “shift points” facing most companies today are the following:

  • Database -- If we’re moving to more complex analytics and big data, is it time to consider alternatives to relational databases and move into graph databases?

  • Application development -- If the IoT world use languages like R, Python, Julia, and Java, do we need to adopt those languages and skillsets?

  • Citizen development -- If users want no-code and low-code app development tools, which tools should we standardize on and when should these tools be used?

  • Big data management -- Do we use the cloud or internal resources for big data? What skills and tools are needed in both cases?

  • Security -- What’s next? Are we ready for it?

  • Hybrid computing -- Long term, which applications and resources do we keep in-house, and which do we move to the cloud?

  • Application and resource sunsetting -- Which systems and resources do we target for replacement, and what do we replace them with?

Filling the CTO’s shoes

Non-technology companies need to answer these questions, even if they can’t afford to hire a CTO. How do they do it? Here are a few options.

1. Use senior staff

The most common alternative CTO approach in non-technology companies is to assign pieces of architectural and directional IT decision-making to their staff experts in different areas of IT.

For example, a storage “guru” might be tasked with defining the overall storage architecture. Where do you use high performance, high cost SDD and where do you use very low disk drive cold storage? What about the various types of disk storage between these two extremes -- or even tape?

2. Consider the idea of hiring a fractional CTO

If you can’t afford hire a full-time CTO and your staff isn’t prepared to assume CTO duties, a second alternative is to retain what is known as a fractional CTO.

A fractional CTO is just that: He or she is a contractor who works on a temporary basis for you. His or her job is to assist you in determining technology direction, tools, re-skilling needs, etc.

Once you retain a fractional CTO, it’s important that you have your senior staff members working alongside the CTO. The end goal should be knowledge transfer to your staff, so that internal staff going forward will be able to assume some of these CTO duties.

The other reason you want to engage your own staff alongside the CTO is staff buy-in. If your staff feels isolated and excluded from technology planning, they aren't as likely to embrace the new technologies that they feel have been chosen for them.

What To Read Next:

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FTD’s CTO Powell on Transforming and the Next New Normal

AWS CTO Vogels on Cloud Eliminating Constraints on Innovation

About the Author(s)

Mary E. Shacklett

President of Transworld Data

Mary E. Shacklett is an internationally recognized technology commentator and President of Transworld Data, a marketing and technology services firm. Prior to founding her own company, she was Vice President of Product Research and Software Development for Summit Information Systems, a computer software company; and Vice President of Strategic Planning and Technology at FSI International, a multinational manufacturer in the semiconductor industry.

Mary has business experience in Europe, Japan, and the Pacific Rim. She has a BS degree from the University of Wisconsin and an MA from the University of Southern California, where she taught for several years. She is listed in Who's Who Worldwide and in Who's Who in the Computer Industry.

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