The Right C’s

An article just came out on CFO.com entitled “Who Needs a COO?” Reading it, I couldn’t help but think about the many articles I see all the time in Information Week about the changing role of the CIO. And it all makes me think that there is something that is still missing.

CFO.com reports that there has been a downward trend over the past ten years in the number of Chief Operating Officers (COO’s). The article explains this trend as being related to the growing role of the Chief Financial Officer (CFO’s)–as the desire for financial accountability rises, the finance function is taking not only reporting responsibility but also operational responsibility as well.

On the other hand, Chief Information Officers (CIO’s) are spend most of their time trying to bridge the gap between technology and business. It is not enough to just get the right computers in everyone’s hands. Companies need their technology leaders to think strategically about how to leverage available technologies to work better, faster and smarter. If you want a sense of the potential of this role, read “Information Worth Billions” in Fortune about GE’s CIO, Gary Reiner.

All this just highlights the disruption in companies as they adapt to a technology- and knowledge-led economy.  Even in traditional industries, the average company has as much as 70-80% of its value tied up in knowledge intangibles (intellectual capital) like competencies, processes, relationships and brands. Technology is the medium that facilitates the flow of knowledge between people, through processes and with external partners. The new factory is intellectual capital. The new production line is information technology-enabled processes. It is hard to separate the intellectual capital from the information technology. I use the shorthand IT=IC to describe this state of affairs.

And it leads to shifting views on the role and responsibilities of the “C” team in most companies. Who should own process management? What about the competencies that go hand in hand with the processes? And the processes that support client communications? And how can you separate processes and technology these days? How do you track the performance of these intangibles?

My bias would be showing if I suggested that maybe the CIO and the COO really should both morph into the a role that recognizes of intellectual capital in both operations and technology.

What would we call this kind of manager? I frankly think that one of the reasons that Leif Edvinsson’s title when he was at Skandia–Director for Intellectual Capital–never caught on was the acronym (DIC, if pronounced “dick”, has a bad connotation). Chief Intellectual Capital Officer (CICO) wouldn’t work either (sounds like “kicko” or “sicko”).

Maybe Chief of Intellectual Capital, CIC (pronounced “kick” for short)? That would work. The position could oversee the intersections between technology, process, people, and networks (the technology and the relationships). A combined role for COO’s and CIO’s-this could end up being one of the most powerful roles in a corporation.

Whatever you call the role(s), it is absolutely clear to me that corporations need to keep thinking about the right focus and organization of their “C” team. The new factory is indeed corporate intellectual capital and the new production line is IT-enabled processes. Who’s minding the factory?