Do companies really need an IT director?

Is Somerfield's decision to dispose of its head of IT the shape of things to come?

The decision by supermarket chain Somerfield to abolish its IT director role and split the departing IT chief's responsibilities between a business systems executive and a systems development manager has given a new spin to the debate about the top job in IT departments. Industry experts are now asking whether it is necessary to have a single chief information officer in overall charge of everything to do with IT, or whether the the job should be divided up among a number of people with different titles and possibly even other roles in the organisation, as Somerfield is doing. "The [CIO] role is changing very significantly," said John Mahoney, research director at Gartner Group. "By the end of the decade at least one third of existing CIO roles will not exist in their current form, and the remaining two thirds will undergo radical change." Today's IT chiefs need to balance in-depth technical skills and experience with more general skills, such as leadership and good communication. But some would argue that it is not enough to have a new-look CIO and an IT-appreciative chief executive and board. They believe corporate IT has to be totally restructured - without a CIO at all. A common criticism levelled at corporate IT departments is that they are distanced from the rest of the business, and consequently fail to deliver what line managers and the board really wants. A recent article in the prestigious Harvard Business Review added to the debate when it claimed that IT has become a commodity, like gas or electricity, and does not give companies an edge over their competitors. David Metcalfe, research director at Forrester, rejected this argument but said it highlighted the need to transform the way IT departments are organised. He believes that the IT department and IT director role should be split four ways, with board members taking responsibility for different elements of it. Under this model, the finance director would handle IT procurement and the chief operating officer would be responsible for innovative application development, with the vice-president for technology in charge of IT production systems. The most senior IT director role would be nothing more than a chief technology officer, keeping an eye on blue sky IT and passing it to the COO when it becomes ready for real-world implementation. This new structure would align each area of IT with the part of the business it is most closely associated with. "IT will be far more innovative and effective if it is more embedded and integrated into the business, rather than existing in a silo," said Metcalfe. Metcalfe said this approach would work because boards are already increasingly hands-on when it comes to IT spending. "IT used to have more leeway, now it is coming under much more scrutiny. We found that 95% of large companies have executive team sign-off for $500,000+ IT projects. All IT decisions are under the microscope," he said. That does not leave the CIO with a great deal of power, he added. Moreover, the executive team is increasingly capable of making good IT decisions. But not everyone is convinced. Critics argue that board directors lack the necessary technical understanding to assume responsibility for IT and that breaking up the IT department would cause confusion across the business. "There is a basic lack of understanding by business of what the head of IT does. If you take away the IT director's responsibilities and hand them to other directors, they will lose the plot," said David Rippon, chairman of the BCS IT Directors' Forum. "IT is complicated, and it is so significant a part of the organisation's functioning capabilities that you must have someone who understands it." Even if IT is outsourced, said Rippon, it still requires an in-house CIO and an IT management team to oversee it. A fragmented IT function could easily lead to fragmented IT, leading to turf-wars and gaps in responsibility. John Handby, chief executive of CIO Connect, said, "Where you have different responsibilities for IT you can lose consistency." Mahoney said, "If you are going to fragment corporate IT, you need to have two key things: you need to have the governance and communication processes in place to ensure that all the elements of technology provision remain co-ordinated, and that an appropriate process remains in place to control an enterprise wide architecture." Somerfield's departmental reshuffle has led to some interesting debates about the future role of IT directors and their departments. However, reports about the death of the CIO are premature. Supporters of splitting the IT director's role three or four ways and handing over responsibility to other board directors, still have a lot of explaining to do before wary companies are won over. Abolishing the IT director post could fragment reporting lines and could see directors unused to the intricacies of Linux and technology projects overwhelmed by the specialist technical skills required of a head of IT. Is Somerfield's decision to dispose of its head of IT the shape of things to come?

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