When Does Your Business Need a CIO or CTO?

The answer to this question is relatively simple.  When the CEO, business owner, or leadership team is spending a majority of their time overseeing technology, rather than focusing on their core competencies, it’s probably time to consider a CIO/CTO.  In some cases, this this position can be outsourced but for larger organizations, a CIO or CTO can be a vital part of the leadership team.  In this article, we’ll explore the precursors, options, and business considerations for hiring a CIO or CTO for your business.

Should Your Business Outsource?

Outsourcing technology and outsourcing your CIO are two different approaches that can work for many businesses.  There can be dramatic cost savings with this option that provide you the ability to tap into extensive technical expertise, at a fraction of the cost.  In addition, an outsourced CIO typically provides additional services and resources that they are accountable for overseeing and implementing.  But, there is no ‘one size fits all’ approach so it’s equally important to consider all the options available.

Many businesses consider hiring a CIO when they have more users and/or departments than their internal personnel can support and more needs than their leadership team can juggle.  For most organizations, hiring a CIO becomes necessary at 100 or more users.  It’s important to note that many businesses find outsourcing technology to a Managed Services Provider or technology advisor to be a great alternative to bridge the gap as the business grows.

Your outsourced technology provider should be able to help make important decisions in conjunction with your leadership team.  Effective communication and accountability will ensure that your overall business strategy, staffing, processes, platforms, and capital expenditures are considered for all technology decisions.  After all, technology affects your daily business operations and your bottom line.

Do You Need a CIO or CTO?

As your business evolves, the internal needs of your organization will drive this decision.  Departments within your organization will all be vying for time, resources, technology, and budgets.  In a company that is experiencing accelerated growth, or is already at the enterprise level, the internal teams will need someone internally to set priorities and facilitate conversations between departments.  This is when a CIO or CTO becomes a valuable delegate for the leadership team.  Here is a breakdown of the differences between a CIO or CTO:

• CIO – a business leader that primarily works in the C-Suite with other executives to develop an overall technology strategy. This position typically has experience in business management and operations but is not the CFO.  CFO’s may be tasked with the duties in smaller organizations, but do not typically have the technical expertise to make holistic technology decisions for a growing business.
• CTO – a business leader that focuses on executing a planned strategy. This leader is the tactician who is responsible for the overall infrastructure and typically has the technical background to make the technology work.

It is possible to have one person act as both the CIO or CTO, but the practicality of this will be driven by your organization’s size and needs.  In both of these cases, an outsourced technology provider can still be an invaluable resource to the organization and CIO.

Which Comes First?

Far too many organizations wait until after many technology decisions are made, to hire the technical experts who can ensure those expenditures and decisions are sound.  For most organizations, the following hiring sequence can make a lot of sense:  1) hire an outsourced technology partner, then when needed 2) hire a CIO, and then, if required 3) hire a CTO.  The reasons are simple.

• When you outsource first, you can easily scale while tapping into valuable technical knowledge and expertise, at a fraction of the cost. The biggest mistake many businesses make is to only utilize internal IT staff which can create a number of challenges.   This option is preferable as it can be implemented with or without any internal IT staff while minimizing growth pains and creating important redundancies.  In addition, many organizations simply cannot support a $300k+ salaried role early on, so this serves as a great alternative.
• Hiring a CIO second allows you to continue to utilize outsourced technology services providing consistency and support, while your CIO gets up to speed on organizational initiatives. The CIO can then work to develop a more comprehensive strategy with the C-suite while the outsourced technology provider keeps things up and running smoothly.
• After the CIO is on-board and has a strategy developed, they can then determine if a CTO is needed to help execute those strategies. The CIO and CTO may still elect to outsource some or all of the technology, but you now have an internal leadership team to communicate and coordinate technology rollouts.

Determining when and how to implement technology into each phase of your company’s development is important to your overall success.  It’s also important to create some consistency along the way, and a valued technology partner can provide a wide variety of capabilities including Managed Services, network monitoring, cloud data management, and 24/7 help desk.  Are you looking for a strategic technology partner to help you develop a comprehensive plan?  The technology advisors at Conscious Networks are ready to help!  Schedule a consultation today.