The Role of the CTO: Four Models for Success
By
Tom Berray, Primary Author1
Raj Sampath, Secondary Author2

Tom Berray
Executive Director
Cabot Consultants, Inc.
1750 Tysons Boulevard, Suite 400
McLean, VA 22102
703-283-3121
tom.berray@cabotinc.com
tberray@yahoo.com

1

Tom Berray is Executive Director of the CIO/CTO Practice with Cabot Consultants, an executive searchfirm in Virginia. Prior to joining Cabot Consultants, Tom was with Heidrick and Struggles and the Gartner
Group. Tom is the chief architect of the study, as he created the four-fold model based on nearly three
years of research while building the conceptual framework from top to bottom.
2
Raj Sampath, a Business Architect in the Global CIO/CTO Practice with Heidrick & Struggles
International, edited this piece and contributed to some of the content and writing. Raj can be reached at415-291-5240 or rsampath@heidrick.com.

C 2002-Tom Berray
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Introduction:
With an increasing number of organizations exploiting information technology ininnovative ways, many companies have been adding a Chief Technology Officer (CTO)
to their executive leadership teams. One can argue that this role is among the least
understood of all c-level (CEO, COO, CFO) positions in the executive suite. But given
the impact of technology on business organizations over the last twenty years, it may be
the most promising when considering ‘competitive strategy’ in the future. The Holy Grailof all competitive strategy will concern the elusive nexus of ‘technology’ and‘leadership.’ These parallel issues converge in a unique way in the CTO role. Because
the CTO is a relatively new position, there are various roles CTOs play in theirorganizations. On the one hand, many senior executives express confusion about what
is and should be the exact role of the CTO. On the other hand, is there a way tomeasure the intrinsic ambiguity and complexity of a role, where research, development,
technology innovation and leadership vision intersect in unpredictable ways? For
example, the CTO of a multibillion dollar media company believes “I suspect it will bedifficult to define the role of the CTO as many people attribute different functions to the
CTO. To me, one common function is the ability to assess technology’s strategic future
impact on the corporation.” The CTO role is polymorphous: it either assesses the useof an existing technology or develops a new platform, which impacts an organization in
improving its competitive performance within a given industry.
This paper explores two fundamental questions: What are the current models in
corporations for the role of the CTO? Which model is right for your company? This
study was conducted over the past three years. It is drawn from discussions withhundreds of CIOs and CTOs as well as a written survey of approximately 30 CTOs.
During the course of the research, many variations on the specific roles of the CTO
began to emerge. These variations make it difficult to define a “typical” or “normal” CTO
and their responsibilities. The intrinsic ambiguity of the role does not reflect its lack of
power or influence given more familiar roles within the executive suite (CEO, CFO,
COO). On the contrary, it concerns the single most important question of futurecompetitive strategy: how does technology (in the widest sense possible) relate to
optimal decision-making at the top, which in turn enhances competitive performance,
higher margins, greater market share, and long-lasting dominance of a certain industry?
In looking across many industries and companies, we can categorize different CTOs
into four (4) general models.

Model 1: CTO as “Infrastructure Manager”
With the escalating complexity of information technology (IT) many companies haveallocated some of the responsibilities of the traditional Chief Information Officer (CIO) toa CTO. The CIO retains the “staff” role of IT; they oversee technology strategy,
executive-level relationships, budgeting, and the fusion of IT and business processes.
The question—“How effective is the IT organization?”—remains in the forefront of the
CIO’s mind. In model 1, the CTO takes responsibility for the “line” role of IT. He/sheruns the infrastructure and operations of IT: data center operations, network operations,
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applications development & maintenance, security, and other line functions. Thus, theCTO’s focus is to keep the IT organization operating efficiently. Additionally, this CTO
generally does not determine how technology will be used to support the organization –the CIO usually retains that responsibility.
In this model, the CTO usually reports directly to the CIO, who is a senior executive inthe organization, reporting to the CEO or President. Sometimes the CTO will have an“officer” title, but he/she will not be considered an officer of the company. The person
who takes on this CTO role should have proven operational skills, a keen sense ofmanaging technology, and an ability to lead a large and diverse organization. In thismodel the executive function and technology enabler is split apart: the CIO retains the
traditional elements of executive power while the CTO is responsible for day-to-day
management and operations. Splitting apart these functions has repercussions fororganizational behavior, design, and integration for the company, and thus affects its
ability to perform at a maximal level.

Model 2: CTO as “Big Thinker”
The CTO as “Big Thinker” spends his/her time evaluating how technology can be usedinternally by the business to 1) enable new business models and business lines, 2)
increase revenues, and 3) preempt a competitor’s attempts to use technology to disrupt
or dislodge his/her company’s market position. This CTO’s responsibilities often include
advanced technology, competitive analysis, technology assessment, prototyping lab,partnering, planning, and architecture standards. The CTO may report directly either tothe CIO or the CEO, and generally has a small, elite staff. In some cases, they operatealone. Thus, this CTO works mostly from a position of influence - as opposed to directcontrol like the line manager. Often the CTO has been with the organization for a
substantial period, and has built a strong reputation with the senior executive leadershipteam. The other scenario is a CTO, who comes from outside the organization but has atremendous public reputation.
The successful CTO must be well respected within the organization. Furthermore,
he/she must demonstrate the ability to influence key senior executives to consider new
information or different paths to accomplish key goals. Typically this CTO is given
ample room to contemplate long-term innovation, broaden the strategic horizons of thecompany, and envision future paths. This means alleviating the restraints on the role,
which in turn generates more independence. But inversely, this CTO does not always
have direct and actionable say in concrete decision-making, which is always intertwinedin an intricate web of relationships within the executive suite. The CTO has the freedom
to think in the broadest possible ways, but inversely must await a longer period of trial
and incubation to see innovative ideas become reality.

Model 3: CTO as “Technology Visionary and Operations Manager”
The CTO as “Technology Visionary and Operations Manager” is usually found in a
dot.com or other technology-oriented company where information technology is the key
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ingredient in implementing business strategy. The CTO is responsible for determining
how technology can be used to implement the business strategy. This informs the‘technology visionary’ aspect of the role. But then subsequently, the CTO is responsible
for actually integrating and running the technology, i.e. the role of the ‘operations
manager.’ Hence, the CTO must have an excellent combination of both business andtechnical skills in order to successfully design the functional and technical aspects of thebusiness strategy and then build the IT organization to execute its components. As oneof the top executives in the company, this CTO is usually brought in very early in thebusiness life cycle to help get the company off the ground. Often, the CTO is a cofounder of the business and knows his/her best role is staying tuned in with thetechnology. One common problem we have observed with this model is the following:some CTOs develop new strategies and move technologies rapidly, but do not have theIT management and infrastructure in place to successfully implement these new ideas
and technologies. Their zeal for technology innovation outstrips the organization’s
capacity to manage rapid change. One of the great challenges of this CTO is tobalance the initial expenditure of energy towards product research and innovation whileconsidering the enduring business requirements necessary for building a successfulcompany.
In model 3, the CTO reports directly to the CEO or may even be a co-Chairman of thebusiness. The person, who assumes this CTO role, should have a strong technology
vision with the practical ability and experience to design, build, and run the technology
while managing a large organization. Larger organizations may also have a CIO
reporting to the CTO. In this case, the CIO will usually fulfill the role of infrastructure
manager. According to Bruce Rogow, IT Consultant, one of the pitfalls is CEOs hiring
CTOs with vision but no real experience in actually creating and running an IT
organization - a mismatch that can be disastrous to the future of the business.
Visionary technologists are successful ‘managers’ of organizations when they
understand how technological instruments function in complex contexts, which include
relationships among other assets (human, social, knowledge, and financial capital,
communications, marketing, branding, customer relations, etc.).

Model 4: CTO as “External-facing Technologist”
The CTO as an “External-facing Technologist” focuses his/her efforts on using
technology to provide better products and services to external customers or clients.
Nearly every major IT consulting company implements this CTO role. This brand of
CTO has to be outwardly focused with respect to external trends and willing to embrace
spheres of innovation, which lie in and outside of his/her company. They may notnecessarily identify with their organization wholesale, but view themselves as an ether
or network, which permeates multiple institutions and industries. In consulting
companies, the CTO is usually an equal peer of the CIO or may be considered a higherlevel executive than the CIO (although the CIO does not usually report to the CTO in
this case). In this scenario, the CTO’s main role is to develop the strategic technology
plan for the organization by identifying, tracking, and experimenting with new andpotentially disruptive technologies. The goal is to project and assess technologies'
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impact on the corporation and its customers. This differs from the traditional CIO’s
technology plan, which most likely focuses on the technologies to support the internal
systems of the organization, i.e. running the trains in day-to-day management
operations.
The CTO usually has a relatively small group of people (10-50 people, depending on
the size of the organization). His/her responsibilities may include technology research &development, technology transfer and change management, intellectual property,
knowledge management and/or best practice management, and advanced specialized
technology centers. In addition, the CTO is usually responsible for ensuring that bestpractices for exploiting key technologies are shared across the organization’s front line
to its customers. Like the second model (CTO as “Big Thinker”), this CTO may have astrong reputation with the senior executive leadership team-- either from internal
relationships or external public perception. This person’s success will stem mostly froma position of influence as a key advisor to the CIO, COO, CEO, and other senior
executives. It is difficult to measure the sphere of influence of this type of CTO. On the
one hand, he/she serves in a broad, advisory function, which may precipitate majordecisions or changes in direction for the company. On the other hand, there is no clear
definition of this CTO with respect to some of the more traditional functions in theexecutive suite.
In this model, the CTO usually reports directly to the President/COO, CEO, or othersenior executives. He/she should combine a broad knowledge of the potential value inemerging technologies, and a keen understanding of how these technologies can affectthe company’s business and business processes. This person also needs strong
communication and interpersonal skills to influence senior executives. The CTO’s
function is to help them evaluate different paths to achieving the business goals, inaddition to being an external spokesperson for the organization. One can argue thatwith increasing awareness of the value-add of this CTO role, traditional industries,
which are typically averse to radical innovation (i.e. disruptive technologies), will cometo rely on the CTO for major corporate and organizational decisions.

Matching CTO Role to Organizational Need
Given these four broad models of CTOs, we next examine a framework for matching the
CTO roles to the organization’s business needs.
In Figure 1, we map the different CTO roles against two driving forces: 1) the amount ofbusiness change affecting the organization from either internal or external pressures,and 2) the percentage that information (versus physical assets) represents in theorganization’s suite of products and services.
Lower Left Quadrant“Information Technology has become nearly ubiquitous in almost every customer
interaction. At the same time, the ability to provide ‘bullet-proof’ information security has
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become an ever-increasing and daunting challenge. These two factors cry out for somekind of CTO role even in a relatively slow-moving and information-sparse industry likeours.” – CTO of a multibillion dollar chemicals manufacturing company.
In the lower left quadrant are organizations in relatively stable industries and thus facerelatively low amounts of business change. Although companies in this space conduct
mergers and acquisitions, the pace of these does not overwhelm the business as awhole. In addition, these organizations use information to help build and support theirproducts, but it is not a critical component for their success in the market. Somegeneral examples of industries are food services, chemicals, and raw material
companies. If companies in these industries choose to add a CTO to their organization,
they should consider the “CTO as Big Thinker” model. This CTO is a low-cost addition
to the organization, yet can help reap potentially high pay-offs by identifying andelevating critical opportunities for the organization. Inversely, they can preempt any
potential threats, which loom on the horizon.

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CTO Role for Organizational Needs
High

Business Change

InfrastructureManager

Visionary andOperations
Manager

External-Facing
Technologist

Big Thinker

Low

Information as % of Products/Services

Figure 1
In the upper left quadrant are organizations engaged in a high degree of businesschange: many are in the process of numerous and/or large mergers and acquisitions.
In addition, companies in this space may be experimenting with and launching many
new products and services. However, since information is a relatively small part of the
products and services, these organizations may best be served by positioning their CTO
as an “Infrastructure Manager.” A CTO will benefit the organization by focusing on costreduction. He/she can leverage the existing infrastructure across the existing and new
business units. Also, by driving toward a common infrastructure, the organization will
ensure better communications and collaboration across geography and business units.
In the lower right quadrant are organizations where information is a critical componentof the business, yet the business is experiencing relatively little change. Establishedresearch, information technology consulting, software, and hardware companies aresome good examples of organizations that might fall into this quadrant. The “ExternalFacing Technologist” CTO may help companies by driving future product/service, and/or
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business model opportunities while providing a respected presence for clients, industry
analysts, and the media.
Lastly, in the upper right quadrant are organizations in a high state of change, which
use information as the key component of their business. These companies constantly
use information technology to launch new products, enter new markets, and create
partnerships and alliances. The companies often require a CTO as a “Visionary andOperations Manager” to meet the fast-paced demands of these interactions. This CTO
must be adept at knowing the potential of the technology and how to make it work – withreliability, availability, and scalability.

Relative Strengths of the Different Models of the CTO
As a complement to the framework in Figure 1, the following table addresses therelative strengths of each of the CTO models. In Figure 2, we rank the relative
capability of each CTO against 10 key business requirements and processes.
Business
Requirements/Processes

CTO asInfrastructureManager

CTO as Big
Thinker

Identify new technologies

LOW

HIGH

MEDIUM

HIGH

Exploit new technologies

LOW

MEDIUM

HIGH

HIGH

Integrate new technologies

MEDIUMLOW

HIGH

MEDIUM

Leverage technology acrossbusiness units

HIGH

MEDIUMHIGH

MEDIUM

Drive the business strategy

LOW

HIGH

HIGH

HIGH

Drive Revenues

LOW

LOW

MEDIUM

MEDIUM

Reduce costs

HIGH

MEDIUM

MEDIUM

MEDIUM

Enhance client relationships

LOW

MEDIUM

MEDIUM

HIGH

Enhance communications andcollaboration

MEDIUM

MEDIUM

Low/Medium

HIGH

Build out or leverage existing IT
infrastructure
Figure 2

HIGH

LOW

HIGH

LOW

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CTO asCTO asVisionary
ExternalandfacingOperations Technologi
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Conclusion
In conclusion, organizations first need to think through the IT functions, which they
currently have in place. Secondly and more importantly, they must decide what
additional functions they need. By understanding the way in which the role of the CTO
is developing across many industries companies can create a CTO position that will
best enhance their own business opportunities. Now and in the future it will be
important for companies to think strategically about the relationship between technology
and their ‘leadership needs.’ In other words, they must assess what kind of technology
leadership is required for the growth or stabilization of their company. The issue is not
simply the obvious need to keep apace the frightening expansion and development of
disruptive technologies: of course this is just one of the factors, which play a part ingeneral competitive strategy. Rather, engineering new types of leadership will impact
how an organization maximizes its resources, strengthens its brand, and leverages
internal and external relationships. This in turn will evolve industries and markets in
new and exciting ways.

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Biographies:
Mr. Berray is Executive Director of the CIO/CTO Practice of Cabot Consultants, an
executive search firm, with over 17 years of information technology (IT) hardware,
software, and services industry experience. Prior to joining Cabot, Tom was a Principalwith Heidrick & Struggles in the Information Technology practice. Tom’s search practicefocuses on CIO, CTO, VP Engineering, and other senior information technology
executives in all industries, as well as senior executives for high technology companies
in the hardware, software, telecommunications, professional services, and e-businessareas.
Before joining Heidrick & Struggles, Tom was with the Gartner Group a worldwide
research and advisory company focused on providing information technology
management, applications, and operations research to Fortune 1000 organizations. At
Gartner Group, Tom was a Director with its Executive Programs group, where his
primary responsibility was to act as a personal advisor to over 70 Chief Information
Officer and Chief Technology Officers who were members of the mid-Atlantic andSoutheast chapters. Prior to Gartner Group, Tom worked for Computer Associates andXerox Corporation.
As an IT professional prior to entering the search industry, a sample of Tom’s client list
includes AARP, American Red Cross, Beers, Campbell Soup, Catholic Health East,
Cigna, Cracker Barrel, Deloitte & Touche, Discovery Communications, DuPont, Fannie
Mae, Federal Reserve, Freddie Mac, Fruit of the Loom, Gannett, GTE Wireless,Intelsat, Lockheed Martin, Marriott International, Mobil Oil Corporation, National
Association of Securities Dealers, Provident Insurance, Sallie Mae, TVA, TRW, nearly
every major agency of the US Government, Vencor, Wachovia, and The Washington
Post.
Tom earned his Bachelor of Science degree in Computer Science and Economics fromDuke University. Phone: (703) 283-3121. Fax: (703) 744-1307. Email:tom.berray@cabotinc.com or tberray@yahoo.com

Raj Sampath works with the Global Industry and Functional Practices of Heidrick andStruggles International Group. As a thought leader, innovation architect, and strategicchange catalyst, his responsibilities include the following: work with senior leadership on
strategic development, new ventures, corporate innovation, new business plans,communications, knowledge management, extended research/equity analysis, andthought leadership as it relates to business development and executive search efforts
worldwide.
Raj Sampath has over a decade of international experience, including the U.S., Westernand Eastern Europe, Russia, the Middle East, and Asia, in academics, think tanks,
university and corporate research & development, government entities, media, andC 2002-Tom Berray
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research/development for executive search with an emphasis in financial markets andtechnology. He began his career at the University R&D and Corporate Funding divisionof the University of California, Irvine Administration. There he wrote National
Endowment of the Humanities, National Endowment of the Arts, and National Science
Foundation grants to procure major corporate and federal funds for basic science andtechnology research at the University of California, Irvine. His latest endeavors include
a designee for the Fulbright for recent Ph.Ds and scientists and a D.A.A.D. research
fellowship in northern Germany and Scandinavia. He was awarded the Chancellor's
Postdoctoral Fellowship at the University of California, Berkeley from 96-98. Sampath
has lectured all over the world and published over fourteen articles in international
journals. He is in the middle of composing his second major work on the philosophy ofhistory, religion, and the new millennium, which will be published by the University
Press of America (Rowman and Littlefield Publishing Group). His first major work was
published in 1998: Four-Dimensional Time: Twentieth-Century Philosophies of History
in Europe, Bethesda: International Scholars Publication, 1998.
He holds a B.A. degree in history with a philosophy minor from the University ofCalifornia at Berkeley and a Ph.D. in modern European philosophical-history, with
subspecializations in historiographical theory and epochal shifts, economic history, thehistory of science and technology, and speculative theology from the University ofCalifornia at Irvine. Sampath has also conducted studies/research at the Ecole desHautes Etudes en Sciences Sociales in Paris and the Freie Universität in Berlin.
Sampath is a member of the following organizations: Silicon Valley Charter Member of
The Indus Entrepreneurs (TIE), CIO Insight Leadership Panel, CIO Insight (Ziff DavisMedia publication), Cato Institute, Commonwealth Club of California, World Affairs
Council of Northern California, Society for the Philosophy of History, Society for
Philosophy and Existential Phenomenology, International Society for the Study of Time,and the American Philosophical Association. Sampath is a frequent speaker atinternational conferences and professional organizations. Current writings, businessdevelopment, and topics of interest focus on corporate leadership, vision, power,
management, innovation, monetary systems and financial markets, and technology inthe 21st century. Phone: (415) 291-5240. Fax: (415) 981-0482. E-mail:rsampath@heidrick.com

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