7 Business Skills Every IT Leader Needs To Succeed

The days when CIOs could glide into a long-term career based solely on their technical abilities are rapidly fading.

“It’s no longer enough for IT leaders to be tech experts,” warns Bob Hersch, a principal at Deloitte Consulting. The best-in-class CIOs of today are also business savvy, using their knowledge to embed IT as a service capability.

“This business-centric approach integrates IT into an overall business strategy,” he adds.

The best way any IT leader can augment his or her current technical knowledge — and strengthen their long-term career prospects — is by committing to acquiring the following seven essential business skills.

1. An entrepreneurial mindset

CIOs, regardless of their organization’s size, have to act like entrepreneurs, operating with speed, agility, and ever higher levels of passion, empathy, and creativity, advises Ram Nagappan, CIO at global investment firm BNY Mellon Pershing.

Disruption is the new constant. “Competition is coming from all corners of the market, with fintechs and startups moving at light speed,” Nagappan says. To meet competition head on, CIOs must think like entrepreneurs and act as agents of change. “They need to constantly think about how their business could be disrupted at any point in time and how they can creatively deploy technology to get ahead of potential disruptors and future-proof the business,” he suggests.

2. Strong leadership skills

Leadership is a core competency that paves the way to successful technology transformation. “To truly lead, you must have business acumen in addition to technical understanding,” explains Richard Cox, CIO at media conglomerate Cox Enterprises. “Our jobs are really to leverage technology to unleash the potential of the business, and you simply have to have an understanding of the business landscape in order to exploit these opportunities.”

Leadership is a combination of internal and external engagement. The problems CIOs face today are growing increasingly complex. The future is ambiguous, and answers are often not clear or simple. “The only way to navigate in … these uncharted waters, is to build an environment that allows people to bring ideas, perspectives, and input to solve problems,” Cox says. “Building teams that create aligned empowerment is more important today than ever.”

Poor IT leaders often make the mistake of setting project plans, gate reviews, and delivery dates without educating the IT team on the who, what, when, and why of how the effort will help the enterprise, says Harley Bledsoe, CIO at BBB National Programs, a nonprofit organization that oversees more than a dozen industry self-regulation programs that sets standards for business advertising and privacy practices.

“Bringing the team along on the journey as they execute on their deliverables is critical to developing an effective solution,” he explains.

3. A consumer-oriented focus

Technology has never been more powerful and accessible. Most employees — technical and non-technical — now have easy access to an array of sophistcated device, software, and network tools. CIOs need to ensure that workplace and work-at-home technologies at least keep pace with consumer products and services. Employees will quickly get frustrated if enterprise technology and services are more difficult to use than their home counterparts, Hersch warns. “When IT is perceived as an obstacle, the entire department is at risk,” he says.

Shadow IT typically emerges when enterprise employees become dissatisfied with IT-provided tools. “These alternative IT capabilities diminish the CIO and IT’s role,” Hersch explains. “Over time, this can create the perception that the central IT department is an expensive and expendable infrastructure that doesn’t enable the organization for growth.”

4. Financial acuity

Once a CIO recognizes and understands the various factors that influence their enterprise’s finances, they can more accurately pinpoint the technology investments that promise to make the greatest impact.

“It’s extremely likely technology can help solve any major problems or expand upon new opportunities,” says Martin Christopher, CIO of insurance provider CUNA Mutual Group. “It may be in accessing data for analytics, accelerating products to market, growing or optimizing channels, or [providing] automation and AI for better customer experiences, but inevitably there are tangible ways technology can help.”

Christopher recommends spending time working with the enterprise finance planning and analysis (FP&A) team. “Too often, CIOs limit their focus to their own budgets and may only have a general sense of what’s causing changes to the company’s quarterly performance,” he says. “Your FP&A teams will often have the best sense of what’s happening ‘below the waterline,’ which could lead to a larger impact on company performance, positive or negative.”

Christopher adds that business unit leaders will generally be grateful to see the CIO’s interest in what makes their business tick and how technology can help accelerate delivery of their objectives.

For CIOs working for a regulated industry firm, such as insurance or financial services, Christopher suggests spending time with the organization’s governance, risk, and assurance (GRA) team.

“CIOs who misunderstand the frame of external requirements their company operates within will find it difficult to honor commitments to their business partners,” he says. CIOs who aren’t fully informed on regulatory issues may also inadvertently discourage creative thinking, subconsciously fearing that the innovation may, in some way, violate a regulatory mandate.

Bill VanCuren, senior vice president and CIO at NCR, believes that IT leaders should possess at least some formal accounting and finance education. Even more important, he adds, is maintaining a close working collaboration with the CFO team to review costs and other key financial issues.

“You should also facilitate formal benchmarking of your IT costs and benefit tracking for comparison to best practices both within your industry and more broadly,” he recommends. “I personally participate in business case reviews to stay current on where IT investments are being positioned across the company.”

5. Strategic thinking

IT leaders should never stop refining their strategic reasoning abilities skills. “CIOs need to envision the future state of their business, spearhead strategies that create new products and business models, and influence change,” says Thomas Phelps, CIO at Laserfiche, an enterprise content management technology provider, and an adjunct professor at the University of Southern California Marshall School of Business. “To do this, you need a deep understanding of your business, your industry, and be willing to try bold new ideas.”

CIOs are increasingly expected to stay ahead of existing and emerging technologies and evaluate them within the context of business goals. “They have to work more closely than ever with the CEO and every business line within the company,” BNY Mellon Pershing’s Nagappan says. “They must bring to the table their business knowledge as well as the creativity needed to deploy technology to advance business goals, and to deliver a seamless, superior client experience and greater efficiency.”

6. A technologist’s mindset

A technician has a basic knowledge of general technology principles and applications. A technologist, on the other hand, is someone who’s fully aware of current and emerging technologies and their impact on business operations and services.

“It’s more than understanding technology — it’s also truly understanding business,” says Alicia Johnson, consulting principal of technology transformation at professional services firm Ernst & Young.

A successful CIO must be able to set an enterprise’s IT direction while planning for future expansion. “To do this, they need to be transparent, exhibit strong communication skills, partner with other business units, develop a reliable team, and demonstrate a vision for the business,” Johnson explains.

A major challenge for CIOs is knowing how to do more with less, particularly when planning budgets. “If a CIO can think logically about the direction and growth plans of a business, they’ll be able to understand available budgets and which investments are most important in reaching the overall business goals,” Johnson says. “This skill is essential, because it will help CIOs succeed when it comes to business investments, partnering with the business, communicating, setting expectations for stakeholders, and team development.”

Being able to articulate a clearly defined future vision will also helps build trust within the IT team as well as with enterprise peers.

7. A strong business communicator

An IT leader must express ideas and concepts in a manner that business colleagues can easily understand. “Lose the tech-speak,” advises Seth Harris, a partner in executive search firm ON Partners.

CIOs should speak in terms that a non-tech expert can understand and, whenever possible, use metrics that mean something to the business. “For example, don’t talk about upgrading a web platform, talk about driving revenue via ecommerce and the critical components needed to make that happen,” Harris suggests.

Being an active listener goes hand-in-hand with strong communications skills. “To meet and exceed customer expectations, mutual understanding is critical, which can only be achieved through a strong relationship built through open and active back and forth communication,” BBB National Programs’ Bledsoe says.