The CIO Career Path Paradox

In this excerpt from her book The CIO Paradox, Martha Heller finds the career lessons of executives who moved beyond IT remain relevant today. Among them: be ready to step up. Diversify your experiences, accomplishments, and skills. And seize opportunities to lead other functions before reaching for the CEO ring.

Two years ago, a delightful group of Danish CIOs invited me to Copenhagen to discuss how my book The CIO Paradox (Routledge, 2012), had changed in the years since I wrote it. Rereading that book taught me two things: never reread your own work (you'll find typos), and everything old is new again. Yes, we now talk about AI instead of "big data," but the leadership principles that defined the CIO role then still define it. 

I've selected the excerpt below on "the CIO career path paradox" because it captures the wisdom of CIOs who later became COOs or CEOs. Today, as more CIOs make that leap, their advice remains spot-on.

The CIO Career Path Paradox

CIOs are uniquely positioned to move into different chairs around the executive table, but only if they seize on the opportunities that present themselves now. CIOs can do what it takes to get by, or they can leave no stone unturned and enjoy the opportunities they create with all their hard work.

Many CIOs aspire to become COO, attracted by increased power, compensation, and influence—though the path remains challenging due to the CIO Paradox. How can executives who touch every part of the business, from order to delivery to HR to finance, who are responsible for standards, QA, cost reduction, and process improvement, and who know their company's operations intimately, not be considered for a COO position? Whatever the reason, CIOs who have made their careers on the basis of their technology excellence will need to distance themselves from it at a certain point in their career.

Raise your hand for enterprise initiatives

Typically, the CIO-to-COO journey happens as follows: the CIO takes the job with some understanding that she will have the opportunity to reach beyond IT and assume an enterprise leadership role in an area like call center operations or customer care or strategic planning. She does just that and tells her boss she is ready and able to move into the COO position at the appropriate time. That time comes along, and she is anointed.

If you did not come onboard to your current position with a clear understanding of your COO career path, you still have options, of course. The first is to look for a new CIO role where you can onboard differently. The second is to skip that part and look for a COO position at another company. This move is not impossible, but it's tough. CEOs are often unwilling to take a chance on someone who has not already performed the role in its entirety.

The third option, and probably the best, is to look around your current company and see where you can expand your reach. Obviously, if you aren't successfully delivering IT to your company now, you should stop reading this chapter and get to it. But if you are a respected and valued member of the executive team, you may be ready to start building your COO résumé.

In 2009, Bill Wray joined Blue Cross & Blue Shield of Rhode Island (BCBSRI) as CIO. He started with responsibility for IT but then picked up core operational areas like customer service, claims processing, and continuous improvement. In 2011, BCBSRI hired a new CEO who did a review of the executive team and asked Wray to take the COO position.

When he stepped into the new role, Wray promoted one of his leaders into the CIO position and took on new responsibilities, including the clinical side of operations, client services, and the organization's for-profit wellness services subsidiary.

Wray didn't set out to become COO. "If I like what I'm doing and I'm getting fairly compensated, I am happy," he says. "I didn't come to work every day saying, 'I must be a COO.'" At the same time, Wray has always sought out responsibilities that extend beyond the traditional boundaries of IT. "I believe that people are defined by the problems they are asked to solve," says Wray. "I have always chafed at focusing solely on solving technical problems, when most of the important and interesting challenges are about something other than technology."

Greg Carmichael offers another example of a CIO reaching beyond IT. After serving for several years in a number of IT leadership roles at GE, Carmichael became CIO for Emerson Electric. In 2003, he joined Fifth Third Bancorp as CIO. "My job was to get the IT organization to a place where we could acquire and integrate other banks and open new branches," he says. "We accomplished that in a short amount of time, so I started to take on new responsibilities." Carmichael took on areas beyond IT, including investment operations, Six Sigma, global sourcing, and program management. In 2006, his title changed to COO to reflect those responsibilities and to anticipate his role in future initiatives.

Carmichael agrees that reaching beyond IT is a critical step in securing a COO role. "Step in as acting CFO when there is turnover in finance, or lead the recruitment effort for a new head of HR. Demonstrate enterprise leadership in your day job and you're on the road to your next position," says Carmichael.

When Carmichael joined Fifth Third, he saw the company had not matured in its sourcing strategy, an area he knew well from his years in manufacturing. "My recommendation was that we build a sourcing organization," says Carmichael, "and I offered to do it myself."

Go for continuous improvement

When Wray joined BCBSRI as CIO, he saw that there was no real continuous improvement discipline in the company—no structured approach to improving cost, customer service, and risk management based on Six Sigma principles. "I said, 'We need this, and I'm going to sponsor it.'"

As his company's continuous improvement champion, Wray was able to use his CIO skills to provide enterprise leadership at a different level.

"If, like most CIOs, you are good at project management and good at driving structured change, you will be good at being your company's continuous improvement champion," says Wray. And because these skills are the same as those you use in IT project delivery, you don't have to get permission to practice. "Continuous improvement is a natural extension of your CIO role. It makes you a better leader, and it will give you more than technology problems to solve," Wray says.

Don't be shy

We have all been told, from the time we were children, that actions speak louder than words and that if we work hard enough, the fruits of all of that labor will be bestowed to us. While that may often be true, if you are after the COO ring, you need to speak up. I have interviewed a number of CIOs who have become COOs, and every one of them communicated their intentions to their CEOs. Wray concurs. "Let it be known that you are interested in taking on the larger, more interesting problems. Sometimes you have to do things on a pro bono basis, but if you are generous with your skills, the rewards will come back to you."

Get ready to "be" the business

Wray says that his time as CIO prepared him for much of what he now encounters as COO, but there are some significant differences. "As CIO, you could be successful as an executive who could manage IT and be sensitive to the business," he says. "But as COO, you have to be the business.

It is tempting to continue to solve technology problems, but if you do, you will never be embraced as the COO and your new CIO will never grow into the role." As CIO, your business partners are your customers, and it is your job to support and enable business change. "But as COO, you have to engender change at a very different level," says Wray.

"Now, the meat of your job is to come up with the business strategies that other people enable and support. You have to get that part of your brain working. It's no longer, 'How can I help you?' It's a different kind of conversation."

Be prepared to diversify your management style

As CIO, you managed IT people. But as COO, your teams include a much more diverse group, which may well require you to change your management style. "When I was CIO of Citizens, I ran an organization of four thousand people, but they were a technology and operations team," says Wray. "Today, I am managing nurses, who work with individuals on individual problems. I am used to coaching people to work at the portfolio level, not the transactional level. I have to figure out how to do that."

From CIO to CEO

The path from CIO to CEO is certainly less travelled than the road to COO, but it does exist, and CIOs who use their position to build their CEO résumés are the most likely candidates.

"When you are CIO, you are practicing some of the skills necessary to be a CEO," says Mike Kistner, who was CIO of Best Western International and then COO and CEO of Pegasus Solutions, a provider of reservation and distribution technology and financial and marketing services to the hospitality industry. "As CIO, you need to be great at strategic planning, finance, HR, sales, and marketing," he says. "And with businesses using more data and becoming much more scientific in the way they run, someone with a technology background could be a great candidate for the CEO role."

The problem is that the board of directors still may not see it that way. "What's ironic is that, precisely because a CIO has been successful in his or her role, the board sometimes has a bias that once you have the technology view, you can never transcend it," says Kistner.

The CIO Paradox that Kistner refers to, of course, is that once you're in IT, you can't get out. By obtaining the considerable skills and focus necessary to run an IT organization, you brand yourself as a technology person and that brand becomes your albatross. But, as Kistner and others have proven, this is a paradox that can be broken.

Michael Capellas, former CIO and CEO of Compaq, CEO of MCI and CEO of First Data, and later Chairman of VCE, was one of the first and certainly most famous CIOs to break the CIO Career Path Paradox.

He sees plenty of reasons for CIOs to make the leap: "CIOs have to be experts at solving complex problems. They have to be precise and experienced planners, they have to spring into operational mode, and they have to be more global than their peers."

Preparing for Promotion

So what can CIOs do now to prepare themselves for the corner office?

Learn to balance internal and external demands.

"The CEO has a much larger group of external constituencies than the CIO, including the board, investors, partners, and customers, and has to know when to prioritize the internal versus the external," says Capellas.

"When I became CEO of Compaq, my first priority was to be the voice of the customer and to go on a hundred customer visits and see everyone. I thought that it was absolutely the right thing to do until I realized I was on the verge of being an absentee leader."

Change your management style.

Capellas reiterates Bill Wray's caution that, when you take on teams outside of IT, you should think hard about your management style and make some adjustments. This is even more important when you are CEO. "As CEO, you have a far more diverse group of people to manage—HR, finance, product development, sales—and you have to learn to relate to them in different ways," says Capellas.

Run IT like a business.

For CIOs who truly aspire to the CEO seat, Capellas offers an exercise.

"Think of yourself as the CEO of your own business where demand for your services will always be higher than your ability to supply them," he says, "and everybody is an expert in your consumer business but nobody understands your enterprise business." According to Capellas, if you can manage those significant business conflicts in a way that keeps all your customers happy, you will have developed the relationship and sales skills to make it as CEO.

Develop your "minors."

As a CIO with a "major" in technology, you may have quite a few "minors" to develop before you are ready for general management. During the late '90s, Michael Curran was promoted from CIO of Scudder Stevens & Clark (Zurich Scudder Investments) to a series of general management roles, including COO. In 2001, he became CIO of the Boston Stock Exchange, and in 2005, he became its CEO.

"All CEOs have a major in something, and they've had to build their knowledge of other functions off of that core," says Curran. CIOs should do the same, he says. "Take a course in contract law and negotiation, learn balance sheets, learn something about marketing. If you're working globally, read a book about each country you're visiting, learn a foreign language."

With a serious day job as CIO, you cannot expect to develop expertise in each of your company's domains, but you can, according to Curran, "get good enough so that you don't embarrass yourself."

Scale your conception of systems relationships.

"CIOs live in a systems world, and they understand the interdependencies among the elements of the systems—the hardware, the apps, the networks, the third-party vendors," says Curran. "If you can scale that notion of interdependencies to a broader level that includes boards and governance, product management, people, services, and sales, you will be able to adopt the CEO mind-set."

Plan a transitional move into general management.

From 1996 to 2000, Chris Lofgren served as CIO of trucking company Schneider National. At the same time, he became president of its logistics business. In 2000, he was promoted to COO. He became president and CEO two years later. "With the exception of a technology company, it is highly unlikely that a company will promote a CIO directly to the CEO position," he says. "It makes more sense that a CIO would aim for a role running a business unit—one that is driven more by information—before attempting the CEO role."

Embrace variety.

Marc West is CEO of Mamasource, a social networking service for mothers. His career took him through military programming, regional banking, Mobil Oil's corporate group, Oracle consulting with P&L management, Quick & Reilly on Wall Street, and Move.com—a dot-com start-up he helped build from nothing to $70 million.

By the year 2000, West had worked in the fields of military, financial services, energy, and high-tech. He built technology, ran a P&L, grew organizations, and shrunk them. He had worked in small companies where he wore many hats and in huge companies where he had a very defined role.

My perspective as a recruiter is that, while consistency, focus, depth, and loyalty are important, it is also true that the greater diversity of roles you have had in your career, the more career options you will have open to you.

Know your strengths.

In 2000, West took his first bona fide CIO position when he joined Electronic Arts, a leading provider of video games. "They were a $1 billion company that wanted to be 3X in three years," he says. "That was their battle cry, but their technology was a significant limiter." West shored up both IT operations and the development group which helped grow the company to $3.2 billion. In the end, West decided to move on, because video games were not a passion for him, so he would have a hard time moving into a general management position.

From his experience at Electronic Arts, West gained a powerful personal insight: "There is a difference between universal capabilities—like leadership and communication—and business specialist skills," he says. "At Electronic Arts, if you are not a gamer, you cannot convince yourself that you can become one and grow into a general management role. You need to know what you're good at and be good at it. It's a learned instinct thing."

Use the two-way mirror approach.

After four years at Electronic Arts, West joined H&R Block as CIO. Again, he found a company whose technology was a barrier to growth. After improving the business platform at H&R Block, West moved from CIO to the corporate operations role, with the title of group president for corporate. In that position, he created a new product offering and business platform by partnering with retail store operations to develop a new business unit, H&R Block Commercial Markets, which would provide tax preparation software to mom-and-pop tax advisers, and which brought in an additional 380,000 new customers.

West came up with the idea for Commercial Markets during an RFP process for some tax preparation software he was evaluating to support the business. "We used that RFP to review the major software providers to our competitors," says West. "From that software review, we learned a lot about the independent market and what our next move could be."

West calls this approach a "two-way mirror" model: in the course of evaluating technology for your own business, you ask the right questions to gain insights about how your competitors are using that technology.

"Every time you look at a technology, consider not just what it does for you, but what it does for your competitors," says West. "Then you are thinking like a CEO."

Running a Technology Company

One of the most travelled routes from CIO to CEO is via the technology company. As long-time customers of technology providers, CIOs know the products and development process, they know the business—from the customer view—and they've sat through enough presentations to know how (or how not) to sell technology solutions. And if they've been networking with their peers, they should have a good customer target list as well.

Mike Kistner's career trajectory started in the hospitality industry. He moved from senior developer at Super 8 Motels to call center manager, then to presenting technology offerings to large franchise groups, and eventually became COO with responsibilities spanning IT, reservations, franchise services, HR, and convention planning. After Super 8 was acquired, Kistner joined Best Western as CIO and later took on distribution as well. In 2005, he joined Pegasus Solutions as COO and became CEO in 2008.

Go for an operations position first.

"A great stepping-stone from CIO to CEO is the EVP of operations," says Kistner. "It's a gradual transition. You can expand both your horizons and the perception people have of your leadership skills while you hold onto IT."

But once you have secured that operations title, your work isn't done. "I will tell you that, regardless of how many years you've been a COO, if you came up through the technology path, people will still talk to you as if you have a technology bent to everything you approach. Even when you've solved huge business problems and had many public speaking engagements, the board of directors will still view you as a technologist."

As a CEO in charge of a technology company, Kistner says that time can solve the problem for you. "There gets to be a point you've been a CEO long enough that people just come to see you as a traditional CEO with a broad background," says Kistner. "The economy plunged within a month of my becoming CEO, so I had to focus pretty intensely on the finances of the business. People just started to look at me now as someone to lead them through difficult times."

Polish your leadership skills.

"As CIOs, I think we sometimes mistake project management skills for real leadership skills," says Kistner. When you are focused on project delivery, it is critical that everyone follow a road map with strict attention to roles, budgets, and timelines. "If you are providing real leadership, you want teams that are not necessarily following your direction. You need a team that will challenge you, but who will provide the innovation you would never get from a team that just falls in line."

Make sure you love to sell.

When I am coaching CIOs who want to move into CEO roles, I usually ask them about their sales experience. They often tell me that, while they have not actually sold products or services to external customers, they have a track record of selling business cases, requests for funding, and "vision." That track record is impressive, to be sure, but it is different from sales.

"CEOs sell," says Kistner. "And that can be a real transition from being a CIO. If, at heart, you are a technologist, you will want to tout the capabilities of your product instead of selling your solution. If you are at all uncomfortable with selling, you will have a tough time as CEO."

Fill in your skills gaps.

Sean O'Neill is Chairman of Newmarket International, a sales and catering solutions provider for the hospitality industry. He was the CIO of ITT Sheraton when he realized that he wanted to broaden his aspirations. "I was creating a ceiling for myself as CIO. I wanted to have broader influence over decision making and decided to pursue a different path."

During interviews with his next employer, travel vendor Grand Circle, O'Neill talked about "how we had transformed information technology at ITT Sheraton into a business function that was integrated with the business. They knew that, while I was coming to them as a CIO, my motivation was to be on the business side."

Grand Circle hired O'Neill as CIO, with the understanding that he would soon add EVP of operations to his role. Several years later, in 2001, he joined Newmarket as CEO. "I chose a technology provider strategically," says O'Neill. "I wanted to stay close to what I knew best. I had the experience of being a consumer of these products and could get up to speed very quickly."

O'Neill's advice: "Become a student of the skill sets required to run a business. As CIO, you have access to a wide variety of leaders both inside your company and out. Interact with those people and start to understand where the gaps are in your own skills."

He found, for example, that while he had a good grasp of functions like accounting, human resources, and sales, he needed a better understanding of the financials. "I would risk looking like someone who doesn't get it by raising my hand in a meeting and asking, 'Why did we use this debt structure?'" he says. "I would anticipate my next meeting with our CFO and prepare questions."

CIOs who can do it all can rise beyond IT

The recurring advice that CIOs turned CEOs or COOs gave during our interviews was "Recognize your strengths and be careful what you wish for." This points us to a particularly enduring CIO Paradox: That which makes for a great technologist, can be precisely what makes for a lousy CEO. The DNA necessary for thinking through the details of a complex technical problem may be different from the DNA necessary to get a market excited about a new company or product. Same goes for accountability.

To quote Marc West, "On time and on budget is not the same as satisfying customers and shareholders while generating meaningful revenue."

If you are the exception to that rule, and you have mastered the skills of IT leadership and you have the je ne sais quoi of a GM, you have no reason not to move up and out of the CIO role—if that is what you want to do.

The number of success stories of CIOs who have followed that path is only growing.