The CIO: Emerging or Submerging?

July 15, 2014

Paula Rosenblum

Last week, RSR’s partners took our first crack at a 2015 Benchmark report agenda. Gosh, this year is flying by. One study we discussed was “The Re-emergence of the CIO.” We haven’t done a report purely on the state of IT in four years, and it seemed time to take the temperature of the industry again. When the title was proposed, I responded “What re-emergence?”

The general consensus was that in today’s rapidly changing retail world, the CIO is more important than ever. Then we saw the announcement of Target’s new tech appointments in the news and I was back to saying again, “What re-emergence?”

For those of you who missed the story, Target is continuing to ‘bolster its tech capabilities” by hiring three new technology executives. Okay, that sounds reasonable. The first hire is Jim Fisher, formerly of First Data Corp. to be SVP of infrastructure and operations for Target Technology Services. I assume that is the shared service that used to be called IT, or maybe Systems Programming and Computer Operations. He reports to Bob DeRodes, Target’s recently appointed CIO (and former CIO at Home Depot, along with his recent Homeland Security gig). Makes sense. No problem. But after that, the train starts to fall off the rails.

Hire #2: Alan Wizeman has become VP of Target.com and mobile products. He will report to Peter Glusker, Targets recently hired SVP of new Business Integration and Operations. There is no indication of any reporting relationship between Mr. Glusker and Mr. DeRodes.

Hire #3: David Weissman is Target’s new president of the DermStore (a recent acquisition). He also reports to Peter Glusker and was previous EVP of eCommerce and omnichannel for BCBG Max Azria.

The general media thinks the big story here is that Target is hiring people from outside the company. I suppose that’s a good thing, especially if you want to distance yourself from your past. I’ve said before on these pages that when a CEO’s direction is deemed bad by the board, internal succession plans go out the window. This is clearly thematic at Target. But for me, the big story is different. It’s all about the CIO and IT governance.

Is the CIO really emerging? When you look at the organizational structure of the United States’ third largest retailer, you have to say no. Mr. DeRodes is more than just a security guy. He led the acquisition of a pretty vast mélange of business-oriented technology solutions at Home Depot, attempting to move them from a [mostly] home-grown environment, to a packaged software solution user. And yet he is essentially being painted as little more than the company’s Chief Information Security Officer (CISO).

This is incredibly worrisome. When a primary goal of a company is to become an omni-channel retailer, it’s imperative that it accesses one set of data on customers, products and orders. Retailers continue to report lack of visibility into orders, customers and inventory as a top-three inhibitor to cross-channel consistency and execution. From where I sit, that can only happen with ONE person in charge of the whole thing.

I know there are people who talk a lot about dotted-line relationships, and matrixed organizations. I’ve never been fond of them, and have turned down CIO jobs because they were matrixed between a division head and the corporate CIO.

I know Mr. DeRodes isn’t shy, so I imagine he doesn’t need me to lobby for him. But I will say this: these reporting structures are likely untenable over the long haul. It’s imperative that a company has ONE set of data, and one person with final say over who buys what. Because if the enterprise is allowed to continue in such a fragmented way, it will be destined to have fragmented and convoluted technology stacks.

We will likely still put some kind of “state of IT” benchmark study out next year. Many of you have asked us about our take and research on the topic. Truth is, after we wrote the last one, Brian and I both opined that after being out of our chairs for, at the time, 11 years, we could sit right back down in them and face the same problems we’d had when we left. In many ways, that’s why we haven’t done another survey like it for so long.

I suppose it’s somewhat good news that at least shiny new problems have been added to the list. But they’re ugly problems, done in the name of “progress.” It seems like the world of the CIO is a really tough one. IT departments are proliferating within large enterprises like bunnies and mid-sized players are following their lead. No good can come of this. Ever.

What do you think? We’ve put together a 3 question survey to find out – we’d love to have your input!

 

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