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The role of CTO in digital transformation (2020)

(Image credit: Image source: Shutterstock/Wichy)

The role of a Chief Technology Officer (CTO) is a mix of procuring abstract goals and achieving futuristic innovations – probably a reason why it is one of the least understood of all C-level profiles.

As digital transformation climbs up the top of every business agenda, organisations are grappling to put their best foot forward, while embracing new technologies to stay ahead of the race.

Naturally, a CTO is expected to be a part of every transformation project. With one eye on emerging IT technologies and the other on building a link between business and technology, they drive digital transformation.

Evolution of a CTO

Traditionally, the role of a CTO was confined to keeping track of emerging IT trends, policies, and ideas critical to improving a company’s product or service. Organisations had someone else at the CXO level to interpret how those trends will affect their customers.

But thanks to digital transformation changing the course of how industries operate, the role of a CTO is quickly redefining itself. Today, they are the drivers of a company’s transformation strategy. They create new business models and digitise products—and they look after human resources and budget.

What does digital transformation mean to a CTO?

Digital transformation has successfully intertwined with business today. A chief technology officer's job is to ensure tech strategy aligns with overall company goals.

A CTOs profile is often narrated as the ‘bridge-builder’ between people and processes within an organisation, as these are the technical components needed for driving a transformation strategy.

To understand further, here’s what the role of a CTO looks like:

They transform a company.

As discussed above, a CTO’s role has extended beyond monitoring technology performance or managing mundane operations. In fact, you could say CTO stands for ‘chief transformation officer’.

A CTO uses his/her skills to enter new areas of operations within a company’s environment and contribute to its top and bottom lines. Indeed, CTOs are the architect of strategic transformation in their industries.

They keep IT innovative.

Part of a CTO’s power is to appoint information technology to drive business. This means constantly developing new technology skill sets to push ahead of the competition.

For this reason, CTOs have redefined the importance of a business’ competitive advantage in the digital spectrum. They require new-era capabilities and board-level skill sets to incorporate changes to existing frameworks.

They seize the moment.

CTOs know what the future holds. They constantly build upon their vast knowledge of systems and security, which makes them aware of the next big thing. Likewise, they use these skills and experience to attract and hire new talent to help them reach their goals.

They influence business strategy.

CTOs always consider their company’s strategic goals when executing their IT strategies.

Using logic, awareness, and research, CTOs can influence the overall business strategy of their firms. They have a knack for anticipating new threats, foreseeing new technologies, and embracing the maturity of secular trends. 

In a bid to understand how technologies are evolving, CTOs conduct one-on-one sessions with vendors. They know how to create value for their companies. This puts them in a unique spot to lead the C-level panel on many vital issues. A few of these include:

  • Creating a roadmap for a business to succeed.
  • Addressing challenges such as when to delay/adopt new technologies.
  • Investing in technologies like AI or blockchain to improve ROI.
  • Developing core differentiating capabilities.
  • Coming up with new revenue resources.

They become their customer’s voice.

Does your technology investment plan focus on creating customer value? Or does it simply focus on saving costs?

A good business plan ensures excellent customer experiences. CTOs understand that for companies to remain relevant and profitable, customers should be their priority. They diagnose the root cause of issues and create unique value propositions around their customers.

They don’t just build; they integrate.

In the past, CTOs would manage a simple set of partnerships with a few hardware and software vendors. They rarely had a chance to address system integrators. Their main focus was to build in-house technology assets to keep the business going.

Things are different today. The number of technology touchpoints has multiplied exponentially. These are quite complex and have the potential to influence the overall results of a business.

In fact, different types of software and models of delivery emerge each day. Saas and other “as a service” offerings are rising, too.

In short, CTOs not only build assets but also leverage technology ecosystems. With their strategic and commercial expertise, they develop partnerships and execute decisions for organisational growth.

They create operating models.

A well-structured operating model will link strategy with operations. For a clear competitive advantage, a CTO addresses the following concerns:

  • The needs of internal customers/stakeholders.
  • Reducing infrastructural and operational risks.
  • Identifying key decisions and responsibilities.
  • Maintaining cross-divisional and cross-functional integration.
  • Increasing operational inefficiencies.

During a digital transformation, the role of a CTO changes from the initial stages of survival to making allies and foes within the team. However, a CIO’s role is deeply varied and may also change over time—even within the same business. A report by global cloud services company Access Alto identifies four distinct categories of CIOs.

The four different types of CTO

The visionary

The visionary is usually associated with the organisation from inception and is responsible for devising technical strategies and blueprints of the business model. For CTOs in this category, the agenda is to drive the business forward.

The infrastructure commander

The infrastructure commander oversees infrastructure, IT network, data security, and maintenance. They work for established organisations where they implement their already-approved technical strategy for business.

The customer champion

The customer champions have a deep understanding of their respective customers. They are responsible for delivering customer excellence in UI and UX. They are the face of business and they focus on problem solving.

The big thinker

The Big Thinker works in close quarters with the C-level profiles and the senior management team. Big Thinkers are creators of business models. They ensure that technologies are utilised within the organisation and aid in developing the corporate strategy.

Conclusion

Digital transformation does not come easy. Leaders must become transformers of their enterprise culture and strike the right balance between short-term improvement and long-term value. We hope this article will help CTOs take the right steps for creating the changes their company needs.

Deepak Gupta, CTO and co-founder, LoginRadius