March 18, 2022 – Technology is changing almost every aspect of our personal and business lives. Smartphones have more processing power than the supercomputers of only a generation ago. Digital storage capacity and transmission bandwidth have grown exponentially, and cloud has helped lower costs and increase access to technology platforms. Data has become the strategic asset of the era and, combined with advances in machine learning and AI, has created an explosion of new opportunities and risks, according to a new report authored by Spencer Stuart’s Danny Koh, Charlie Stack, Muthiah Venkateswaran, and Julia Westland.
“This progress has led to more specialization and the creation of distinct technology domains, each with its own organizational and cultural challenges,” the Spencer Stuart report said. “In response, companies are seeing a proliferation of new leadership roles and job titles and it has become increasingly difficult for boards, CEOs, and executive teams to cut through the jargon associated with each role to understand its purpose.” In the report, Spencer Stuart explored the six technology leadership roles that have either emerged as a result of these trends or whose scope has fundamentally changed in recent years. The firm described each role’s purpose and the typical background and attributes that would make someone a truly distinctive player in each role.
Modern technology leaders need to represent digital domains like engineering, security and privacy or data and analytics as business owners, not order takers or technicians, said Spencer Stuart. “They contribute to the business strategy, prioritize investments, steer teams towards delivering business value, protect customers and employees, influence stakeholders, and shape culture,” the firm said. “The COVID-19 pandemic has accelerated change and shown how important it is for a company to integrate new digital capabilities in its operating model. During the crisis we have seen many of these new technology leaders step up into more significant business roles to help their companies respond to the crisis — leading strategy, customer experience, operations, and even transitioning into P&L roles.” Spencer Stuart expects that technology leaders will take more prominent, lasting seats at the executive table in certain technical domains where rapid competitive advances are evident.
Chief Product Officer
The chief product officer is focused on the market and understanding the “voice of the customer” in order to translate it into a differentiated software product strategy. “CPOs understand how to use products to solve customer needs and create differentiation in the market,” the report said. “They are responsible for ‘product-market fit’ and constantly strive to improve product differentiation. A growing number of non-technology companies are establishing a product management function, often in response to technology disruption. It is an emerging role that sits at the intersection of business, customers, market, and technology.”
Best-in-class CPOs have the mindset of a future CEO, according to Spencer Stuart. “They have a deep understanding of market needs and can wrap their minds around all aspects of the business, especially the role of technology in driving growth and creating long-term differentiation,” the firm said. “Some end up in a general management role, owning the product P&L. Indeed, many founders of leading technology companies are innovative product leaders who continue to own critical product-related decisions.”
Spencer Stuart notes that some CPOs come into product leadership from engineering, while others bring business experience to the role, having worked in product marketing, strategy or sales, for example.
Chief Technology Officer
The chief technology officer oversees the software engineering and overall technology development for the business, partnering with customer- and product-focused groups to understand the customer journey and ensure continuous improvement in any customer-facing software. CTOs are responsible for creating a culture of best-in-class software development and driving timely and flawless execution.
“Today’s CTOs take a holistic approach to building scalable platforms that increase reliability and security while helping the organization leverage information across multiple use cases,” the Spencer Stuart report said. “They understand the power of data and analytics to drive business decisions and factor this into their development roadmap. They are comfortable with modern technology development practices and can apply agile methodologies and automation to the development, testing and deployment of code.”
CTOs tend to have deeply technical/engineering roots, said Spencer Stuart. Most often, CTOs are ex-software engineers themselves, growing through the ranks of application or platform development or R&D or occasionally enterprise architects.
Chief Information Officer
The chief information officer takes ownership of IT operations. This includes data/voice networks, security, infrastructure, architecture, enterprise applications, collaboration tools, and end-user support. Exceptional CIOs do more than ensure that IT’s activities are fully aligned with the business strategy—they are involved in co-creating the strategy in the first place, according Spencer Stuart. “As a key member of the executive team, they have the acumen and credibility to collaborate with and influence their peers, advising on how technology can bring competitive advantage and even drive new revenue streams,” the firm said. “Some are true thought leaders, able to generate new ideas about how technology can transform the business and articulate their insights both internally and on external industry and media platforms.”
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“CIOs typically would have gained domain expertise by taking on infrastructure, applications and IT shared services roles earlier in their careers,” the study said. “Beyond line roles, some of them would also have played IT consulting/advisory roles at companies like Accenture, IBM, and Capgemini. CIOs would normally also have demonstrated capabilities in people leadership, business partnership and transformation through successful execution of complex change projects (e.g. ERP implementation and application rationalization).”
Chief Information Security Officer
The chief information security officer oversees the IT governance practices that safeguard all the technical assets and business operations of a company. According to Spencer Stuart, the primary purpose of the CISO is to protect the digital ecosystem and enable business to be conducted safely, while helping address any trade-offs that may occur in decisions over investments and business processes. “The CISO plays an important role in monitoring and assessing risk and, in some regulated sectors like financial services, is expected to report on risks to the board independently of the CIO,” the search firm said. “In an increasingly digital world, the list of risks that CISOs are expected to mitigate is continually growing. They are responsible for cyber risk, threat detection, fraud prevention, security architecture, identity and access management, investigations, security operations, and standard creation/governance for all technology development.”
The Hunt for Cyber Technology Leaders Heats Up as Risks Multiply
With technology has come the insatiable – and merciless – need for talent. Having the right leaders and teams in place is now more critical than ever. Cyber technology leaders appear in various forms: chief information security officer (CISO), chief information risk officer, chief security officer (CSO), VP information security, chief trust officer, chief information officer (CIO), chief technology officer (CTO) and many others.
These executives are vital, front line leaders facing down increasingly numerous and sophisticated threats. Their job is to secure both the enterprise and its external products and solutions. They report to boards of directors and management committees on a regular basis, are considered strategic assets to be leveraged, and increasingly give organizations their competitive advantage. The cost of hiring one is rising – and that is good news to the scores of executive recruiters who hunt them down for clients around the globe. Read now >>
In addition, CISOs have a communications role, too, syndicating general best practices, raising awareness of threats to the business, and teaching employees about the role they can play in safeguarding the company. “The most distinctive CISOs are not just there to police and protect, but to work with product and technology teams to de-risk new business capabilities,” Spencer Stuart said. “We hear from technology partners that the very best CISOs have created measurable business value, by helping them to overcome significant legal or regulatory roadblocks.”
Spencer Stuart notes that CISOs typically come from one of three types of background:
- Enforcement or protection (e.g. defense industries, government agencies, law enforcement).
- Governance (e.g. audit or compliance).
- Engineering (in more technically complex companies; the prevailing trend is that CISOs need to be more deeply technical and engineering oriented).
Chief Data and Analytics Officer
The chief data and analytics officer is less of a technologist and more of a business leader whose purpose is to use analytics to accelerate commercial performance, said Spencer Stuart. “Today’s top companies think about data as a business asset and therefore need a CDAO who understands the commercial levers of the business, can create a data and analytics strategy, and follow through with strong execution,” the study said. “The CDAO owns the foundational data capabilities of the business, such as data technology platforms and pipelines, data architecture, data governance policies, and standards. The CDAO is also responsible for policies that protect customer data privacy and build trust in how data is used.”
Spencer Stuart notes that CDAOs tend to come from one of three main backgrounds: technology/IT; data science/mathematics; or business/strategy.
Chief Digital Officer
The chief digital officer role is geared towards organizational transformation and generally found in less digitally mature businesses. It tends to be an enabling role, that is to say the CDO needs to work alongside business leaders to inspire and accelerate digital transformation in the organization, according to Spencer Stuart. “With digital increasingly embedded in business strategy, CDOs need a strong commercial mindset and strong communication and influencing skills,” the report said. “As change agents, they tend to be highly collaborative individuals, skilled at raising the executive team’s understanding of digital issues and the technology capabilities required to deliver the strategy.”
CDOs are also charged with inspiring the entire organization to embrace the digital transformation journey, bringing together business units that have not traditionally collaborated to achieve real commercial impact. Spencer Stuart says CDOs can come from a mix of backgrounds, including strategy, marketing, commercial, and technology. However, the CDO role is becoming increasingly rare and is usually only found in businesses that are just starting to explore digital.
The days when companies simply needed a great CIO to take care of their technology needs are long gone, said the Spencer Stuart report. “Businesses are on a journey towards digital transformation, each one in a slightly different place,” the search firm said. “As digital becomes more deeply embedded, the need for specialized technology leaders grows. Which roles a company opts for, and the remits of those roles, will depend on a range of factors — for example, industry, scale, strategy, breadth of the existing leadership team.”
Spencer Stuart also notes that complexity has driven specialization, but therein lies a danger — that teams operate in silos. “Each of the six roles described in this article requires a distinct set of capabilities and yet they all have certain characteristics in common,” the firm said. “Three fundamental qualities are required of any technology officer: business-centricity to understand the fundamental needs of the business and determine how technology can be deployed to safeguard, enhance or differentiate the business, the ability (and willingness) to collaborate with their peers; the persuasive power to influence the executive team; and the leadership skills to inspire and motivate their people to deliver consistently high-quality results.”
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media