Opinion by Al Kuebler

It's the age-old question: To whom should the CIO report?

Imagine if the strategic engine of the enterprise didn't report to the CEO

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The question has been batted back and forth for nearly as long as there have been CIOs: To whom should they report? I won't keep you in suspense as to where I stand: CIOs hold a C-level position, and as such they should report to the strategic leader, meaning either the CEO or the COO.

Why do I believe this? I have several reasons, and none of them has anything to do with status. The simplest is this: Because information technology is the most powerful competitive enabler available to most businesses, its leader should not be relegated to reporting to someone who may have other priorities than the organization's strategic performance.

There are some exceptions to this, and I'll get to them. But first, let me articulate the primary reasons why having the CIO report directly to the CEO is the best arrangement.

1. CFOs have totally different priorities.

CFOs are, by nature, risk-averse. They are charged with protecting the financial well-being of the organization. Their charter is to question expenditures, ensure that proper controls are in place and ascertain that investments realize the expected returns. Their focus is on the short term, and their priority is process. CIOs, on the other hand, must be risk takers. After all, every strategic system development project is risky -- it has never been done before in the company and will have long-term impact. CIOs have to focus on the long term, since most significant IT developments span many years. Their priority is introducing beneficial change, not maintaining a consistent process. When a CIO reports to the CFO, the IT function ends up operating much more conservatively than it should. That might be OK for certain companies, on a temporary basis, and in the course of my career as a CIO, I had some productive working relationships with CFOs that I reported to. Nonetheless, I think that the days when this sort of relationship could really work are gone. Quite frankly, a conservative IT function is not going to help most companies to confront the increasingly intense competitive environment out there.

2. The CEO needs to know what IT can do for the company.

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