The joke has made less sense over time as the perception of CIOs has risen. Kevin Kabat, president and CEO of Fifth Third Bancorp in Cincinnati, is an example. He was chief information officer at Old Kent Financial Corp., which merged with Fifth Third in 2001, and managed to keep climbing the career ladder at the combined institution without completely losing the geek mind-set. "I have a high regard and appreciation for our tech agenda," Kabat says.
Kabat's former-CIO status and his attitude toward technology give him credentials as a tech-savvy CEO, as some of his peers attest.
"Leadership and more importantly a grasp of the value of not just IT but also operations" are characteristics of CEOs who get technology, says John Beran, former CIO of Comerica. "These are not individuals that look at the work of a CIO as a necessary evil. They understand it has enablement capabilities and value if managed correctly."
When Beran started at Comerica, his first boss was CEO Gene Miller. "Gene really got it when it came to IT and what IT could and should do for an organization," Beran recalls. "He brought me in at a high level and had me report to him. At one point, the management of Comerica was five high-ranking individuals, and I was one of them."
Such CEOs are curious about technology; they're not apt to just say "Don't bother me with it," Beran says. "They're interested in learning about it as much as they are other parts of the business."
CIO at the Head Table
The smartest move a CEO can make technologywise, Beran says, is to hire or promote a CIO to the highest level of the company and have that person report to the CEO, as Miller did at Comerica.
At the $117 billion-asset Fifth Third Bank, CIO Joe Robinson "is at the table from day one," Kabat says. Kabat and Robinson meet often to discuss what's next and where the bank is going and Robinson is part of a team that presents a plan of strategic initiatives and expectations each year.
Four years ago, First Horizon had no CIO (there was a chief technology officer who reported to the acting chief operating officer). CEO Bryan Jordan elevated the top technology position to CIO and brought in Bruce Livesay, with whom he had worked at Regions Bank.
"My experience has been that every business solution somewhere, somehow has a technology component to it," Jordan says. "The CIO needed to be a full partner with the business units. If you ever separate the two processes, you're going to have a lot more problems. Bruce and his team are much more effective, in my view, because he is at the table day in day out as we're talking about where we're trying to go from a strategic standpoint."
"You see the more progressive banks elevating that [CIO] role up," Livesay says. "In my case, I have a seat on the executive committee, I'm on the same level as all the other folks that report directly to the CEO and that is a statement about the role technology plays in the company."
Such CEO/CIO partnerships are relatively rare. A survey of 344 chief financial officers and other senior financial executives conducted by the Financial Executives Research Foundation and Financial Executives International showed that only 33% of IT organizations report directly to the CEO; 42% report to the CFO. Similarly, a recent Gartner study found that CFOs are making 26% of IT spending decisions and CIOs are authorizing only 5%. Most experts agree that the chief technology executive should be answerable to the CEO rather than the top bean counter.
The exact title or acronym of the technology chief is not that critical, Beran says, as long as an executive responsible for technology is in the C-suite. At some banks, including BB&T and North Jersey Community Bank, the COO rather than a CIO oversees technology.
In his days at Comerica, "I was a CIO, but I really operated more as a COO," Beran says. "We didn't have a COO, but my responsibilities at the bank besides information technology included operations — check processing, wire transfer, ACH, payments, security, real estate, loan operations. It went way beyond the CIO role."
Some CIOs, including Joe Robinson at Fifth Third Bank and Livesay at First Horizon, perform the COO functions Beran describes. In addition to IT, Robinson is responsible for back-office operations, check processing, loan processing and servicing, and call centers. He also oversees the enterprise project management office, which manages technology and business-change programs across the company. "That's very helpful because it gets everyone focused on the business change and results and the outcomes we're trying to drive," he says. "Rather than getting too deep into the technology or what could be interesting to do, it's what needs to be done to get the results we're looking for." His predecessor had the title of COO.
At some banks a CTO, who is generally lower on the corporate ladder, plays the role of a CIO. And sometimes COOs, such as Laura Criscione at North Jersey Community Bank, act more like CIOs.
Lining Up the Rank and File
Beyond raising the profile of the CIO, IT-literate CEOs have business and IT people work in partnership throughout the bank. At Fifth Third, a consumer technology leader works directly with a consumer bank leader to develop strategies that support the overall corporate agenda, and similar arrangements take place in other business units. At a summit each summer, senior executives in the C-suite listen to presentations from these teams.
