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CIO Succession - Conclusions

Digging into data always reveals interesting - and sometimes surprising - patterns. In studying this set of recent CIO appointments, here are the points that stand out:

  • CIO as a Stepping Stone. The CIO role has become more than an executive "destination job." It is also a jumping off point for bigger and better things. Many of the CIO vacancies in our sample opened through retirement, but a full one-third of the departing CIOs received promotions or moved into bigger and better roles outside of the company.
  • High Levels of Education. These CIOs are highly educated, as one would expect, with 70% holding an advanced degree. But the women more often hold an MA or MBA, while several men hold a PhD. Interestingly, these CIOs do not come from Ivy League or other traditionally prestigious schools as frequently as their executive peers do. This is perhaps because twenty to thirty years ago students at the prestige institutions didn't see a technical education and career as a fast track to the executive suite. We predict that this is changing as the CIOs become more common in the executive suite, and the high potential of technical orientation has become clear.
  • Not Necessarily an MBA. Nearly half of our CIO sample hold MBAs. We would have expected this number to be even higher, given the importance of a business perspective in the CIO role. MBAs are more prevalent in our smaller companies than the larger ones, perhaps because other executive education and leadership programs are more available in larger companies, and CIOs moving through the ranks of large organizations have more range for gaining business experience.
  • Background and Experience. The preponderance of CIOs have backgrounds primarily in IT, only one-fifth in other business disciplines. And no external recruit had a primarily business background. This was initially surprising, given how much one hears about the need for business orientation in IT. However, it makes sense in combination with the experience factor: 86% of those recruited had prior experience as CIOs at some level. So companies hire for proven IT management expertise, and they are more comfortable promoting or rotating established executives from other disciplines into the CIO role.
  • Advanced Industries and Marquis Companies as Sources. With outside hires, companies in our group have been flexible about where they source their CIOs. Sometimes they look for direct experience in their own industry, but often they recruit from companies known for excellence in IT, or companies that face similar technological challenges such as high transaction rates, rigorous security requirements, or global operations.
  • Gender Differences. 37% of the CIOs are women, and it appears that this number is trending upwards. We found age-gender parity: The average and median ages of women and men when appointed CIO were virtually the same, as were the age ranges. We also found that women are much more likely to insiders. This could be because women are less frequently recruited, but also could be that women are more loyal to their employers and less likely to jump ship. In companies over $50B, only 14% of women report to the CEO vs. 60% of men. In companies under $10B 20% of women report to the CEO vs. 43% of men.
  • "Run Room." One often reads about CIO tenures being short and shortening. However, the average tenure of the departing CIOs in our study was five years. And all but three of the newly appointed CIOs were 55 years old or younger. These companies are appointing CIOs with enough remaining "run room" in their careers to make a difference in IT and then perhaps move on to other senior roles.
  • Executive Rotation. Over one-third of the insiders have backgrounds primarily outside of IT. And about 10% of the CIOs rotated into the role from a peer position elsewhere in the business. Cross-pollination between business and IT is a good thing, both to infuse more business experience into the IT organization, and to "round out" business executives in a very critical part of the enterprise.
  • CIOs-in-Training. In a few of the cases, individuals were hired as understudies to the outgoing CIO for a year or so before assuming the role. This kind of succession plan can work well, especially if the role is a big step up for the candidate, if the outgoing CIO has the experience and inclination to mentor the incoming one, and when the seniority level difference between the two CIOs is significant. All CIOs-in-training in our sample are women.
  • Board Participation. The CIOs in our sample sit on very few for-profit company boards, but we see increasing participation and expect that trend to continue as more boards seek to add technology perspective. These CIOs more often currently sit on the boards of industry associations and non-profits. Our study considered only newly appointed CIOs, with an average age of 50. Because of their relatively younger age, we believe that CIOs as a group are better represented on boards than our sample indicates.

 

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