The CIO is dead (long live the CIO) | Between the Lines | ZDN...

Not so fast. While technology is critically important, its care and feeding is not necessarily deserving of a seat at the executive table. No one is arguing that modern IT infrastructure is not complex or not deserving of excellent and capable management, but like any other critical operational function, managing technical infrastructure is no more deserving of a C-level position than someone who manages the supply chain, corporate real estate, security, or asset management.

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Similarly, the CIO who sees his or her role solely as keeping the servers serving and networks networking is largely doomed to irrelevancy.

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nearly every new IT trend points towards those in operational roles making technical decisions, rather than leaving the task to corporate IT. Virtualization, cloud computing, Web 2.0, etc. will all push the implementation of new services to end users, and unless IT evolves, it will fade into a utility that is expected to be seen and not heard.

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While this may look good on paper, any “profit” generated through this model is usually a result of accounting gymnastics rather than additional revenue from an end customer. As IT tries to pass its costs to other businesses, savvy business units are going to make the natural comparison to outside providers, or look for ways to avoid IT organizations that price unrealistically. Furthermore, the best shared services deliver commodities that are best compared on cost rather than strategic value.

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Combined with the increasingly embedded nature of IT, business units will seek to “roll their own” rather than pay for internal IT’s unrealistic chargeback model.

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Droning on about uptime and upgrades is not going to cut it, and purely operational CIOs will rapidly be ushered out of the C-suite. In the future, IT will likely diverge into two disparate functions. The first will be a purely operational group that keeps the networks up, builds and maintains the virtualized infrastructure, and maintains shared business services like email and ERP. Complex and critical, yes, deserving of a C-suite role, no.

The second component of what is today’s single IT organization will look more like an internal consultancy than a shared service. This group will be equally at home in both the business and technical worlds (just as its colleagues in business units will be extremely well-versed in technology), and will work to leverage corporate infrastructure to build new functionality. This group might advise on a new digital marketing campaign, or it might help finance determine the right mix of outsourced and internal infrastructure to support a new system. Rather than being compensated for technical objectives, they are compensated for business results and succeed or fail along with their business counterparts, not based on accounting gimmicks that shuffle costs around the company.

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His or her “customers” are those that write the checks for the products and services the company buys, not internal business units, and problems are tackled jointly with line of business counterparts. In this role, the infrastructure is far less important than the strategic direction of the company and a detailed understanding of the company’s markets, processes and relationships. Essentially the “Information” portion of IT becomes far more relevant than the technical aspects.

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