CIO Job-Holding Expectancy

by Paul A. Strassmann

Computerworld

June 10, 1996

Matching the names of CIOs who appeared on a verified lists at the start of 1994 and again at the start of 1995 confirms that their average job-holding expectancy was about 30 months, and probably less than that. If such a high instability persists, it is likely to accelerate the outsourcing of information systems support services. It will reinforce the prevailing tendencies towards increasingly chaotic solutions to systems management problems.

In the story about the three little pigs the rationale for building a house out of twigs is a short-term thinking perspective. If the prospects of a CIO's career continue to be brief, firms can expect to operate with flimsy systems.

To build a long-lasting, low-maintenance systems architecture for a corporation would take at least seven years. Where the burden of maintaining legacy applications consumes most of the available resources, the planning cycle for getting things right may extend well beyond ten years. This is why the subject of CIO job-holding experiences should be of interest.

Earlier Studies

Stories about the short life of CIOs have been widely quoted in magazine articles for the last four years. When tracing the origins of these stories I always ended up with three surveys - two from major consulting firms, one by a recruiting consultant. In each instance the average job-holding time for a CIO was alleged to be either 25 or 28 months.

A recent survey report in Computerworld suggested that the CIO's time-on-the-job may be somewhat longer, about 34 months. How these surveys were obtained remains a mystery. My first reaction to these numbers was one of incredulity. One does not survey nurses in the emergency ward of an inner-city hospital for statistically valid opinions about the health of urban population.

The 1994 CW Premier 100 survey did examine the question of CIO longevity. It concluded that the mean time of CIOs in position was 6.1 years, with a median of four years. There was one CIO who has been on the job for over 25 years - clearly a candidate for a medal!

The Premier 100 were the best of the Fortune 1000 in terms of information productivity. Therefore, they were not a representative sample of what could be expected. Nevertheless, I could not believe that the differences in job longevity between the U.S. average and the Premier 100 firms could be very large.

Taking Names

There was only one way of finding out for sure what was the CIO turnover rate. It just happens that I have an independently validated 1994 and 1995 mailing list of CIOs. All I had to do is to merge the two lists and see which names remained the same from year to year.

From a list of 496 firms only 232 names of CIOs showed up both in 1994 as well as in 1995. Seventy four firms (see list below) changed CIOs in one year. That yields a turnover rate of 24.2%, or an average tenure expectancy of 30 months.

The fate of the CIOs in the 109 firms for which I could not account for the CIOs longevity is a matter of anyone's guess. I gave good reasons to believe that about half of these firms have swapped out their CIOs. If that guess is approximately correct, the consultants' and the recruiter's findings alleging 25-28 months terms in will be right.

Implications

One view of the roles of a CIO defines it as the development, custody, preservation, safeguarding and enhancement of the information assets of a firm. That implies that CIO should take a long-term view of what needs to be done. Holding a job only for a short time is inconsistent with carrying out long term commitments.

In fact, the relaxation with which many CIOs have viewed the coming of year 2000 suggests that they have always counted on not being around when time comes to account for a perfectly predictable disaster. Thus, short time on a job becomes a self-fulfilling prophecy. It is a telling symptom of the disease that makes our information technologies less effective than their potential.

  74 Firms That Changed CIOs in 1994

    1       AEtna Life and Casualty Co.            
    2       Alltel Corp.                          
    3       American International Grou           
    4       Ameritech Corp.                       
    5       AMR Corp.                             
    6       Anheuser-Busch Cos. Inc.              
    7       Apple Computer Inc.                   
    8       Avnet Inc.                            
    9       Avon Products Inc.                    
    10      Baxter International Inc              
    11      Becton Dickinson & Co.                
    12      Black & Decker Corp.                  
    13      Bristol-Myers Squibb Co.              
    14      CBS Inc.                              
    15      Chemical Banking Corp.                
    16      CMS Energy Corp.                      
    17      Columbia  HCA Healthcare              
    18      Comerica Inc.                         
    19      Computer Sciences Corp.               
    20      ConAgra Inc.                          
    21      CSX Corp.                             
    22      Deere & Co.                           
    23      Digital Equipment Corp.               
    24      Dow Chemical Co.                      
    25      Eli Lilly and Co.                     
    26      FHP International Corp.               
    27      First Bank System Inc.                
    28      Fleet Financial Group                 
    29      Fleming Cos. Inc.                     
    30      Florida Power & Light Co.             
    31      Ford Motor Co.                        
    32      Gannett Co. Inc.                      
    33      General Electric Co.                  
    34      Great Western Financial Corp.         
    35      GTE Corp.                             
    36      Harcourt General Inc.                 
    37      Illinois Tool Works Inc.              
    38      Ingersoll Rand Co.                    
    39      ITT Corp.                             
    40      Johnson & Johnson                     
    41      Kerr McGee Corp.                      
    42      Key Corp.                             
    43      Kmart Corp.                           
    44      Lockheed Martin Corp.                 
    45      May Department Stores Co.             
    46      Maytag Corp.                          
    47      McDermott International Inc.          
    48      MCI Communications Corp.              
    49      McKesson Corp.                        
    50      Merrill Lynch & Co. Inc.              
    51      Microsoft Corp.                       
    52      Monsanto Co.                          
    53      NBD Bancorp Inc.                      
    54      Olin Corp.                            
    55      PacifiCorp                            
    56      Phillips Petroleum Co.                
    57      Raytheon Co.                          
    58      Reliance Group Holdings Inc.          
    59      Reynolds Metals Co.                   
    60      RR Donnelley & Sons Ca                
    61      Ryder System Inc.                     
    62      Safeway Inc.                          
    63      Sara Lee Corp.                        
    64      SCEcorp                               
    65      Scott Paper Co.                       
    66      Sherwin Williams Co.                  
    67      Southern Co.                          
    68      Sun Co. Inc.                          
    69      Supervalu Inc.                        
    70      Texas Instruments Inc.                
    71      TRW Inc.                              
    72      Union Camp Corp.                      
    73      Unisys Corp.                          
    74      Westinghouse Electric Corp.           


Copyright 1996 by IDG Communications, Inc., 500 Old Connecticut Path, Framingham, MA 01701.
Reprinted by permission of Computerworld

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