With financial services technologies in particular developing and evolving at a very fast pace, there is no doubt that the role of the CTO has changed – and will continue to change, evolving from what was traditionally a ‘technical expert’ function to being fully immersed in business strategy.
No longer primarily focused simply on managing a company’s technology infrastructure and ensuring its smooth (and sustainable) operation, CTOs today are increasingly regarded as strategic leaders playing a critical role in shaping and driving the continuing growth and success of a company.
Today’s CTO is a key contributor to a company’s strategic planning and development, working closely with other members of the leadership team – CEO, CFO, CPO, CMO et al – to identify and implement technology strategies (internal and customer-facing) aligned with the company’s business goals and objectives. Gone are the days of a Board checking in, every once in a while, with the CTO. Today, they are more likely to be a permanent fixture on Board agendas with much more sway, and say, in strategic business decisions.
Obviously, this is particularly true in the case of technology-led companies such as IPC Systems, where technology is essentially the product and as such at the heart of all strategic discussion and day-to-day business activity.
CTO is an increasingly challenging role
The role of CTOs – and the challenges they face – in a technology-first business, operating within a technology-driven industry, with an ever-evolving technological landscape, has grown exponentially.
It’s not just a question of identifying (and understanding) the newest, shiniest technological solution to support a specific business objective. It really doesn’t matter how fantastic a particular technological innovation or application is if it doesn’t ‘talk to’ or ‘fit’ with the technology infrastructure and stack already in place – particularly on the customer side.
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Today’s CTO not only needs to understand what new technologies bring to the party, they must understand the potential opportunities and impacts associated with their introduction, and be able to make informed decisions that effectively balance the risks and rewards: “How does it work? How does it fit? Is it sustainable in the short, medium, long term? How quickly will it be surpassed, technologically?”
In a high-tech operating environment that is keen to continue to embrace technological innovation – for example, new cloud models and digital infrastructures – an increasing aspect of the CTO role is assessing potential risks, developing appropriate risk management strategies, and ensuring that proposed technology solutions meet both the company’s and customers’ compliance standards and obligations.
The CTO function today is much more integrated within the broader business functions of sales, marketing, product development, etc. While previously the role was focused more around a company’s future (in terms of sustainable technology), it is now very much more involved in broader commercial strategies and day-to-day activities.
Of course, the element of curation remains, with respect to sifting through myriad ‘next best things’ in financial services technology to separate what is real and ready from what may be a great concept, but still a long way from being ‘launchable’ as a customer value proposition.
A crucial aspect of this curating function is being able to identify emerging technologies and trends and to understand how these might be leveraged – and over what future timeframe – to create new products and services in line with customers’ changing profiles and needs. The CTO must also consider how much change will be required on the customer side in order to benefit from any technological enhancements.
CTOs are business leaders of the future
One of the key advantages to an organisation of having technologists as business leaders is that they have a really strong, integrated view of how technology supports and contributes to a business, as well as understanding associated risks. They can take technology concepts or propositions that a business may be very excited about and help stakeholders understand whether and how it might be valuable (or not) to the business. The ability to link the ‘hype’ component with the risk component is a fundamental shift from the historical “We’ve made a decision, now make it happen!” approach.
The question of whether CTOs make good CEOs is subjective. From a personal perspective, the skill sets that make for a good CTO aren’t necessarily directly transferable to the CEO role, and vice versa.
However, today’s CTO must be a people leader – able to build and manage a high-performing technology team as well as communicate information and insights clearly to other executives and stakeholders. They must possess a wide range of skills and expertise beyond technological nous, encompassing strategic planning and innovation, product development and project management, risk analysis and data analytics, and make an active contribution to their company’s continuing success and future direction in a rapidly evolving business landscape.