Losing CIOs to startups could be costly

Digital disruptors are benefiting from CIO knowledge

A number of CIOs have left mainstream life as business technology leaders recently and are now building new careers with startups and fast-growth businesses. In losing this talent, major enterprises are passively acting as major enablers of digital disruption - and putting their own health at risk.

CIOs from a wide variety of markets including financial services, media and automotive have left major UK organisations to work with market challengers. Tech leaders in the public sector, health and professional services, meanwhile, give some of their precious time to startups on top of leading a major part of their organisations.

This trend leads me to wonder why organisations are not concerned. The CIO role has long been undervalued and has been equally misunderstood. With business challenges coming left and right at every organisation, can it be healthy that some of the best CIOs are not seeing retention opportunities - even if the job title changes to CDO? The gamekeeper-and-poacher analogy is of course overused in business-speak, but the wave of digital disruption embodies exactly that. A driveway, empty house, pet dog or under-utilised car here and there eventually grows into a network before leading to a market position shrinking. Whereas once an organisation may have had the dominant voice, suddenly the customer has greater choice - and more often than not, the new choice is on the favoured mobile platform with a user experience that is a step forward.

Chairing a gathering of the UK’s leading CIOs earlier this year, one, from the third-sector, told peers that “a born-on-the-web charity appears in the UK every day” and the same level of disruption and choice is happening in every vertical market.

One CIO in the construction services industry is preparing a digital business that has direct contact with the consumer as they understand that just as Just Park can utilise the mass of empty driveways and as Airbnb can put spare rooms to work then, eventually, producers of cement, sand and stone could be building a direct-to-the-customer model. Farmers in Warwickshire are already developing digital business models to sell eggs direct to restaurants, cutting out the middle-man.

I don’t wish to overvalue CIOs and the loss of one key member of staff will not kill an organisation. But adding an experienced CIO to a startup can be akin to giving the poachers a sniper amongst their ranks. Suddenly so many foxholes, mistakes and traps are not hypothesis, there is someone on the team that has been there, fallen in the traps, who knows the landscape with a depth of knowledge that it is as if they hold a map with all the dragons marked out.

Combine that with a team offering fresh ideas, the very latest technologies and a business unencumbered with legacy and suddenly potential knows no boundaries. And the legacy is not CIOs walking away from the complex challenge of replacing legacy technology platforms; legacy business models and legacy leadership is preventing organisations from seeing the disruption they are about to face. One CIO I recently worked with described board meetings where the past profit margins were harked back too regularly and large parts of the debates were devoted to market protection. Yet an experimental business alongside could have given the same board a vision of the size of the new prize available.

The digital revolution is not about a change of job title, as I referred to in my last column, digital working methods and the diminished barriers to entry mean organisations need to begin to understand and empower their CIOs before they find their former asset enabling a loft-based rival to chew off a once valuable piece of margin.


Also read:

DevOps is a CIO theory of evolution

Chief Digital Officer: What’s in a job title?