Majority of businesses today are on the journey to digitalization and globalization. The reason is that the world is becoming smaller everyday and as a consequence every successful business has to sooner or later go beyond borders. At the same time the global business landscape is only becoming more complex due to varied factors. And it is in this context that Organizations build business verticals within to manage the complexity. So the logical concerns could be: What kind of IT leaders are on demand? Transformational or transactional? What’re differences between Transformation vs. Transaction? How would you define differences between Transactional and Transformational CIOs?
In its best form, leadership is about creating a powerful future that is compelling in the present, that utilizes the best talents, capabilities and resources of their people and organization to produce meaningful and valuable results. This is more than a positional approach, and having a CIO title will never be enough to make this real. However, given the hierarchical nature of most of organizations, if the modeling of leadership doesn't start at the top, it will likely be little valued anywhere else. Thus, a frank self-assessment and a bit of situational evalution would help in analyzing the effectiveness of leadership.
Why do some transactional CIOs meddle in the middle, seems losing the focus & leadership influence:
- Lack of charisma?
- Lack of business-savvy?
- Lack of Business leadership/vision?
- Poor IT governance?
- Poor cost/budgeting?
- Inadequate portfolio management?
Transactional" refers to operational transactions, taking an input at one end and churning it out at the other with processes in between. "Transformational" means redesigning existing transactions to something new, being innovative/ creative and also introducing completely new transactions hopefully with a strategy that serves the organization well. It's easy enough to churn out the same old things even with minor modifications but to undertake real transformational change requires leadership, know-how and confidence
So an effective leader needs to have both levels and styles of thinking, behaving and acting. Becoming a CIO or being given the CIO title requires technical and adaptive skills, just like any other c-level executive. It doesn’t mean we should say transactional is bad and transformation is good, in the absolute. Any c-level executive has to carry on a conversation in their discipline AND have discussions with their peers.
However, the pace of changes in IT, would force more CIOs into transformation-oriented roles...creating business value is what is expected from CIOs. Further, from transactional manager to transformational leader, it takes thought leadership, transcendent wisdom and trans-disciplinary skill. And, transactional running the systems is going to shrink with cloud and digital technology, once IT is seen as strategic rather than tactical, IT can be transformational when opportunity arises and it is appropriate to seize it. Until then, the rest of the business will feel that if the transactional CIO is talking it's because there are problems, not opportunities, and won't want to listen.
The CIO requires being confident to create and manage change and requires a leadership substance of vision & style that more closely matches the action-oriented style of senior executives and also has some of the analytic & synthetic qualities that are commonly associated with successful executives. The CIO must adopt the attitudes and styles of strategic leadership (transformational way), and also must be willing to engage in conversation with his/her staff on some occasions on details (transactional way) so the staff believes the CIO is not that far away from reality.
As many organizations are at inflection point in digital transformation, the transformation-driven, effective CIOs can help orchestrate such change in organizational structure (vertical), working structure (horizontal) and social structure through the latest digital technology. It doesn’s mean transformational CIO is superior to transactional CIO in every perspective, and both attributes - transactional and transformative - are needed in a CIO otherwise you will either end up with static uncompetitive technology or with completely loose cannon who can throw the organization’s technology into turmoil.
Most CIOs are now managing IT delivery to multitude of business. And that means they play a transformational role of the organization per se. By 2020 not only will the technology transform but also the behaviors and attitudes of the new workforce will change dramatically. IT will not only be extremely embedded in all business operations, it will also be extremely hard to silo - like it is today. The skills that the workforce will need or would have acquired will be dramatically different from what we have today.
The reach of the CIO and the IT organization offers a nearly unprecedented opportunity to take the lead in an organization - in the best sense of the word. It requires real vision, a sense of mission, an ability to foster a collaborative clarity of focus with clients - even when they are not clear, and willingness to go beyond being even a very high end service provider. Much is possible for transformational kind of CIO Leader.
Transformational IT team must have five attributes:
There are connections among Alignment, Architecture and Agility: If you don't understand the business you can't deliver relevant results except using slow, clumsy processes. If you don't have Architecture, you can't easily decide whether a business request maps to your technical capabilities, and Agility can result in chaos.
If being transformational is leadership style, then, the leadership substance underneath is vision, effectiveness, and adaptability. In order for CIOs to be more proactive, influential, and transformational, forward-looking organizations should empower their IT leaders, invite them to big table, initiate in-depth conversation, set positive tone for IT's stability and long term strategy.