August 24, 2006

For years, analysts and the IT press have been urging CIOs to become more strategic, to stake their place at the C-level table. Although that encouragement isn't wrong, it turns out that some IT groups simply weren't meant to be strategic. Laurie Orlov, a research director at Forrester Research (Cambridge, Mass.), has codified what she calls the three archetypes of IT: solid utilities, trusted suppliers and partner players -- the last being the strategic level to which we've all pushed CIOs to aspire.

No matter what your archetype, Orlov maintains, "understanding which is which helps articulate IT strategy and dictate trade-offs, and it helps IT achieve its goal of running more like a business." Furthermore, she adds, aspiring to the appropriate level will limit your frustration in the future. Unfortunately, figuring this out is not so cut-and-dried -- one company may have a division whose CIO should be a partner player whereas the CIO at headquarters should focus on simply being a trusted player. In this Q&A, Orlov talks about figuring out where you fit.

Q: Have the press and analysts been frustrating CIOs all these years, urging them to be strategic when they should have been something else?

A: CIOs have frustrated themselves, trying to be strategic and innovative in firms that didn't have the stomach for that kind of IT, either because the CEO did not believe in using IT that way or because the companies had steering committees comprising department heads voting on IT priorities. That's not going to transform an enterprise. In contrast, I'm sure that at companies such as Amazon, FedEx and UPS, the IT discussions are highly strategic. Governance drives what type you are.

Q: Describe the three archetypes.

A: The first one is the solid utility. The IT organization must provide cost-effective, dial-tone reliability. That is, the network is always there, the PCs function, the help desk responds and the back-office applications are up and working. The CIO typically reports to the CFO, and costs are expected to be transparent and reduced over time.

The second is the trusted supplier, in which you add project delivery to the solid-utility model. Some firms need centrally managed application projects to support process changes in and between functional departments. In these IT organizations, the CIO is likely to report to either the CEO or the COO and the enterprise expects to have all the infrastructure capabilities of the first level, in addition to having application projects managed centrally, and delivered on time and within budget.

The third archetype is the partner player, where the business is IT and IT is the business. IT organizations in these firms pour their energy into creating unique and competitive solutions for customers, suppliers and internal business users. As a result, there is little time for the delay in requirements translation between business groups and IT.

In addition to the reliable infrastructure of the solid utility and the project discipline of the trusted supplier, partner player organizations must deal with C-level expectations and are thus governed by the executive team.

Q: So it is possible to move from one level to the next?

A: Yes, CIOs can move from one archetype to another, but not without the support of the CEO and the executive team. The ones who fit into one archetype who are at companies suited for another get frustrated and quit their jobs.