The Emerging 'Double-Deep' Employee – Are CXOs Keeping Pace?
How much should successful modern executives, managers and employees know about information technology? Should they be self-sufficient with Microsoft Office? Capable of managing a stable work-at-home environment? Familiar with the basic purpose and disciplines of SAP? Aware of emerging applications within their industry or profession? How important are these issues anyway?
Over the last few years, we have been talking about the emerging double-deep workers, individuals skilled in not just their particular job function but also the relevant information technologies. From this perspective, it's easy to see that the IT know-how that a marketing person needs is different from a financial analyst, which is different from an office manager, which is different from a scientist. All of these jobs require a baseline IT fluency, but their ideal IT skill sets vary as widely as their roles.
Sharp growth in the number of double-deep workers is necessary for the true co-evolution of business and IT, and is now being driven by two main factors. Each new generation of workers arrives with more IT experience and fluency than their predecessors and thus is more likely to want to apply IT to whatever task they face. Equally important, ever-improving technology tools and services are enabling IT to be much more relevant and useful to just about any information intensive line of work. In both cases, learning to use new IT tools and the development of new IT skills are usually in the employee's own interest.
This is the main reason why thus far the growth of double-deep workers has tended to be a bottom-up process. Many individual workers and professionals embrace modern, increasingly consumerized, IT to help them become more successful and pursue a richer range of career options. The result is a virtuous circle of ever-improving technology and increasingly powerful individual learning incentives. About the only things that could derail this would be some combination of IT vendors failing to make IT simple enough, or basic educational problems that leave many workers ill-equipped for the required learning.
But while the situation with individual employees and professionals is mostly positive, the status of double-deep executives and managers is much more mixed. In our report last year on the CIO and the Board, we showed that most external board-level directors have little knowledge or even interest in IT, and have no real incentive to change the situation. We think this will prove problematic as IT's role in most businesses inevitably increases (this is one reason why boards are increasingly relying on outside technology advisers).
In short, our double-deep research thus far has shown that we have a positive story at one end of the market and a negative situation at the other. But what about the middle – the managers and CXOs who are charged with running the modern large enterprise? In many ways, we think this is the most interesting category to examine. How important is double-deep IT knowledge to the development of executive talent and the management of the firm? How strong are the incentives to learn?
To try to answer the CXO part this question, we recently interviewed 25 non-IT CXO-level executives across a wide range of industries in North America. The primary purpose of the interviews was to determine what these executives think about the importance of their own personal knowledge of IT to both their overall careers and their day-to-day responsibilities. While such a small sample cannot provide definitive results, we think the two main findings below are consistent with our wider client experience. We hope to study middle management IT knowledge further during 2011.
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Only one-third of CXOs think that IT knowledge is an important personal career differentiator
Of those who saw IT as important, most came from finance and marketing. As one senior financial executive told us, "The more IT-savvy a business manager is, the greater the chances that he or she grows in an organization." Of course, during their careers many financial executives have had to work extensively with spreadsheets, often developing custom applications and analytics. Similarly, we have observed for some time that marketing is becoming a technology-intensive profession, increasingly requiring knowledge in areas such as data mining, web analytics, web community building, social media, etc.
Of the two-thirds who downplayed the importance of IT knowledge, several argued that with the growing reliance on technology partners and outsourcing, direct IT know-how isn't as important as staying focused on business results and overseeing partners and vendors effectively. While this is often the case in businesses where IT plays primarily a support function, in industries where IT is also a major part of the product and/or the customer sales/support experience, we find this position worrisome. Today, most industries – telecoms, defence, finance, health care, travel, retail, media, etc. – have a strong IT product, sales or service component. They constitute much closer to two-thirds of the market than one-third.
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Fifty percent of CXOs believe that more formal training in IT would be helpful in their jobs
This is a classic glass half-empty/half-full situation as it can be viewed either positively or negatively. Particular areas where CXOs said that more training is desired include business intelligence, social media and cloud computing – the last no doubt heavily influenced by all the recent cloud publicity. Nevertheless, the fact that half of those interviewed don't think improved training would be useful suggests that the rapid emergence of double-deep executives is unlikely.
We believe that an analogy with CXO financial training is instructive. In the 1950s and 1960s, financial reporting was viewed as an arcane domain best left to specialized accountants; today, just about every CXO in a large organization is expected to have a reasonable grasp of basic financial reporting, with MBA or equivalent formal training often preferred. Similarly, in the 1960s and 1970s, information technology was also a specialized domain left almost entirely to information processing professionals. But ever since the emergence of the personal computer, business leaders have had to become more fluent in IT, and we believe that eventually most CXOs will need to understand their firm's information flows as well as they do the corporate balance sheet.
However, all of our research thus far shows that while the journey has clearly begun, we still have a long way to go before information processing is embedded into our everyday management mindset. In keeping with the consumerization of the IT industry, the emergence of double-deep workers is likely to remain mostly a bottom-up phenomenon over the next few years. This can only widen the IT skill gap between ambitious employees and the top executives of the firm.