Having a CIO-level professional on your board is the first step to treating IT as a strategic asset rather than a cost. Question is, full time, interim or virtual CIO?
IT is no different from any other business-critical area. You know a transformational IT roadmap will bring significant operational and financial benefits, but you need a professional with the right skillset to pull it all together. It needs a strategy, leadership, and ongoing management if you want to achieve measurable returns and competitive advantage. A CIO – but do you need that position filled in-house or with a virtual CIO?
A CIO (Chief Information Officer) is usually the most senior technology executive inside a business. They hold responsibility for the IT strategy and determine areas for improvement and development within the IT systems and processes. A commercial mindset, extensive experience as well as a deep understanding experience of technology and its application, is necessary for a CIO.
A CIO will focus on IT strategy and leadership, ensuring that IT is aligned with business goals.
Unlike an IT Manager, a CIO is more outward-facing. They will focus on IT strategy and leadership, ensuring that IT is aligned with business goals and works in unison with the overall business strategy. However, as the CIO is often the executive level interface between the IT department and the rest of the business, they need to keep abreast of day-to-day operations and issues. Any IT projects will likely be owned by the CIO, and they will be accountable for signing off on the solution and the implementation. They will ultimately be responsible for the project’s success, outcomes, and ultimately the ROI. A good CIO can see past emerging technology hype.
Many businesses assume that the only way to gain access to a CIO’s knowledge and experience is a permanent hire. While this is certainly one option, it can be costly and unnecessary for your current needs. If you’re flying blind how will you know they really are as experienced in the field as you require? There are alternatives available that may be a better fit for you.
We explore four different ways businesses can fill the CIO role: Full-time Permanent CIO, Interim CIO, Virtual CIO and a CIO service. We look at pros and cons of each to help you with the decision-making process.
The 4 types of CIO you could hire
1. Full-time, permanent CIO
A full time permanent hire CIO is an experienced technology leader who sits within the business at board level, with full time generally meaning 40+ hour week for most – and doesn’t come cheap.
What are the benefits of hiring a full-time CIO?
- Dedicated and experienced IT leadership at board level
- Effective IT strategy that works in unison with the business strategy
- Removes the load from senior leadership, allowing focus on their expert areas of the business
- Delivery of operational improvements and a measurable return – they’ll advise on the right investments
- Significantly reduces the likelihood of poor project outcomes, disruption and disgruntled staff.
- Enables businesses to address and manage risk more effectively
- Awareness of evolving threats, as well as changes in the commercial landscape
- Gives a competitive edge, allowing the business to mitigate risk and capitalise on opportunities their competitors may be unaware of.
What are the disadvantages of hiring a full-time CIO?
- The CIO skillset is in high demand – these senior professionals can pick and choose their roles to some extent
- The specialist knowledge makes a CIO an expensive hire. (Average salaries are around £141,000 but can be upwards of £200,000)
- If this is the first CIO a business has hired, then senior leadership may be unsure of what they need.
- Difficulties assessing candidates’ experience and whether it aligns with business needs only serve to make the process even longer
- Mid-market businesses may not have the requirements for a full-time CIO
- Although the strategic direction and commercial focus will undoubtedly be of benefit, a less complex IT environment and a lower capacity for projects could mean a limited scope for change
- Research shows that CIO tenures are short, with an average of just 4.3 years – making them the shortest-tenured C-suite exec
- Two-year stints aren’t uncommon as CIOs often want new challenges and the opportunity to deliver real change.
- A full-time CIO may turn out to be a very expensive, short-term hire. You might find yourself stuck in what feels like a constant recruitment cycle.
2. Interim CIO
Also known as a Contract CIO, an Interim CIO is an experienced technology leader who temporarily fills the CIO role. The average tenure is between six months to two years and an Interim CIO is usually bought in to tackle a specific challenge while the business transitions between permanent CIOs. However, they are also sometimes hired to support and mentor a newly hired or promoted CIO.
An Interim CIO’s role typically falls into one of two camps:
- Responsible for building corporate resilience so the business can maintain a competitive advantage. Essentially keeping the lights on.
- A transformational role, tasked with formulating a strategic plan and executing it.
What are the benefits of an Interim CIO?
- Quicker to hire – a benefit for businesses in ‘crisis mode’ who cannot afford to wait to make a permanent hire
- A benefit to time-sensitive projects (such as an M&A) and need for immediate access to the skillset
- Their laser focus on a specific project or business area allows Interim CIOs to add immediate value
- A dedicated, experienced professional driving an initiative increases the likelihood of that project remaining on track and delivering expected outcomes
- A rich and varied CV can make Interim CIOs valuable mentors
- Experience across multiple industries, business types and environments. They will have seen a multitude of scenarios and challenges – knowledge that can aid the IT department
- Can help senior leadership make better IT-related decisions
What are the disadvantages of an Interim CIO?
- Interim CIOs are an expensive hire
- They are in high demand, and with a limited number of professionals available, they can cherry-pick their projects
- An Interim CIO is only going to be available for a set period, so there may be limits as to what can be accomplished in that time
- Businesses will need to define a clear objective for the engagement and a fixed schedule for delivery
- Existing problems in the business environment may affect the success of delivery
- Long-term or chronic underinvestment in the IT environment, problems left behind by predecessors, or a need for overall business transformation can all affect project delivery
- An Interim CIO will need to quickly get up to speed with the organisation structure and technology portfolio, and quickly win round and influence key team members to ensure objectives are met. (of course, it’s not impossible, but the senior leadership team need to be confident in their hire).
3. Virtual CIO
A Virtual CIO (vCIO), also known as a fractional CIO, provides consultation on IT and technology strategy as a third party. Compared to full-time and Interim CIOs, who take an active role in company operations, the vCIO is often an advisory role.
They will have similar responsibilities to an in-house CIO, but the core difference is that the service is delivered virtually. You may not meet your Virtual CIO and there could be multiple people working on the business at different times, depending on the structure of service.
What are the benefits of a Virtual CIO?
- A vCIO Service offers significant cost savings compared to hiring internally
- Most services are offered at an hourly rate or flat fee, making it easy to budget and account for
- With a vCIO you will have someone dedicated to strategic IT management, even if it’s on a limited basis
- A good starting point for companies new to the strategic approach
- Will be better than people within the business spending a few hours here and there trying to make improvements.
What are the disadvantages of a Virtual CIO?
- Virtual CIO Services focus more on the improvement of day-to-day operations, rather than long-term strategic planning, management and innovation
- A vCIO typically works across multiple businesses, so may not be as readily available to deal with issues that arise
- Businesses which are tech-heavy or very reliant on technology will probably need a more heavyweight and involved resource
- As a virtual service, you may have little to no ‘face time’ with your CIO
- It may be difficult to build trust as the CIO may feel disconnected from the business, affecting results delivery
- Depending on the provider you have chosen, you may also need to factor in time zone and cultural differences.
4. The CIO Service – a better alternative for the mid-market…
You may feel that a virtual CIO wont deliver the expertise and attention needed to achieve measurable outcomes – but you also don’t have the resources or requirements to justify a full-time hire, and an interim CIO just won’t do.
Often, it’s not operationally or commercially viable for mid-sized organisations to have a full-time senior internal IT professional. However, access to professional IT management expertise and skills offers a competitive advantage. With the right management, IT can improve the business’s bottom line, aid client engagement and service delivery, and improve staff retention.
Luckily there is a fourth alternative that bridges the gap, while still delivering tangible value on a cost-effective and flexible basis – a CIO Service.
QuoStar’s CIO Service has been specifically designed to provide mid-market businesses with the strategic IT leadership necessary to deliver the benefits of a full-time CIO but without the significant costs.
What are the benefits of a CIO Service?
- Harness the transformational potential of IT
- Enables access to the skills, expertise and commercial acumen of a CIO-level consultant
- Flexible and cost-efficient
- Supports organisations throughout their entire IT transformation journey; from evaluating current standing and areas for improvement, through to building and implementing a roadmap and change plans.
Our QuoStar CIO Service offers
- Proven, seasoned sector-specific CIOs with a combined 60+ years’ experience
- A proven methodology and framework to deliver a strategy and transformation
- Completely embedded within your organisation – one of the team
- Guaranteed results backed by our Outcome Assured™ promise
- Delivering measurable outcomes for businesses just like yours!
Hear how Blanchards Bailey have benefited from using the QuoStar CIO Service here.