Reference no: EM131681772

Problem: IT at Work

The Strategic CIO

It is not typical for a CIO to work routinely with business leaders on their strategy and translate it into action, and then be asked by the CEO to manage business strategy worldwide. Nor is it typical that the CEO asks the CIO to run a line of business, in addition to the IT function. A CIO would not be expected to manage the process of opening 10,000 seasonal tax preparation locations and hiring 100,000 seasonal tax preparers, but that's what happened at H&R Block, a tax and financial services company. These responsibilities are typical for CIOs who are responsible for IT governance and supporting the business strategy. We'll refer to them as "strategic CIOs" for clarity. The strategic CIO is a business leader who leverages IT to add value and gain a competitive advantage. The strategist's focus is on how a company creates shareholder value and serves its customers.

Rather than being focused primarily on internal operations, the strategic CIO looks at the company from the outside-in by asking how the company is perceived by customers and how competitors apply IT to compete. The role of strategic CIO is focused on business strategy and innovation. This broader, more business-oriented, and strategic focus is the direction for the CIO role. Marc West, the senior VP and CIO at H&R Block, began as a "traditional CIO," focusing 95 percent of his efforts on the technology foundation. In preparing for tax season, CIO West was engaged in delivering tax preparation software for the company's seasonal storefront locations. This activity helped him to acquire insight into the core business, operations, and how customers are served. This further led him to compare what H&R was doing against the competition, gaining a big picture perspective of the industry. He shared his strategic insights with the CEO and management team. Encouraged by the CEO, CIO West continued his "outside-inside" strategic assessment, gaining an industrywide, business-oriented strategic mindset. The CEO then asked CIO West to lead a new line of business, driving growth in the commercial markets.

Questions: 1. Why has the role of CIO expanded?

2. What are the benefits of this strategic CIO role to the company?