Therefore, CIOs must balance their attention between demand for IT-based innovation and the supply of IT services.
Going forward, the CIO’s challenge will be to contribute to their firm’s business management in at least four visible ways.
• First, with growing digitisation of key business processes CIO’s will have an opportunity to contribute to the “top-line” growth and competitive differentiation of the firm. They will be able to influence their firm’s innovations in products, services, customer access channels, and other competitive agility maneuvers.
• Second, with the heightened governance concerns due to Sarbanes-Oxley as well as demands for compliance with industry standards such HIPAA, Basel, etc., there is board level oversight and attention to IT governance, control, and risk assurance. CIOs will be expected to not only develop effective oversight over the control and management of their firm’s IT assets and resources, but also to collaborate with the CFO and external auditors in leveraging IT for implementing effective and efficient financial reporting and enterprise risk management systems.
• Third, CIO’s will have to develop an IS organization with appropriate structures, processes, and skills that excels at managing the “IS business within the business.” CIOs must improvise and develop an organisational model that is appropriate for their firm’s priorities and expectations about IT management. This includes the development and maintenance of an IS organisation that excels at understanding the business needs for IT, delivers applications and services in a timely and cost effective manner,

develops the needed human talent, and manages financial resources with due diligence. Increasingly, such organisational models must include program on management office, a portfolio management process and an IT services management discipline (e.g., ITIL). Our ongoing research reveals that CIOs are developing a variety of organisational models to facilitate their IT strategy .
• Finally, CIOs will have to focus their attention toward developing a portfolio of sourcing relationships with IT vendors and systems integrators and direct attention toward emerging technologies and innovations. Sourcing relationships are being used not just to enhance IT services, but also to improve operational excellence, build new business capabilities, and gain access to new technologies.
What knowledge, skills, and capabilities will CIOs need in the future? Clearly the importance of business knowledge cannot be over emphasised – without a deep and thorough understanding of how value gets generated in the enterprise, the CIO will never be in a position to identify opportunities for competitive differentiation. The future CIO has to not only understand processes, but also strategy, marketplace, customers, and regulatory issues. He or she has to be constantly vigilant to innovation opportunities for creating new products and services. As Tom Trainer, Senior Vice President and Global CIO, Pepisco, Inc., describes his role, “I expend most of my energy as a CIO on my relationships with business executives, sitting with them to make business decisions. For example, I co-own with a top business executive our program to redesign business processes across Pepsico. I’m not just the “techie” observer.”