Offshore CTO?

At first the idea of off-shoring the CTO function looked a bit difficult to comprehend.  To put it in context, IT Organizations hire a Chief Information Officer (CIO) for ensuring that the organizations information technology investments are aligned with its strategic business objectives. For most Fortune 2000 companies, the CIO has become the the architect of building and managing technology assets that meet the business requirements. Many CIOs come from a business background and lack the hands-on-skills in architecting solutions.   To help alleviate this gap, often a Chief Technology Officer (CTO) was hired to support the CIO.  While the CIO was the big boss in most organizations, technology-centric firms gave more credence to the CTO.  Large firms can afford the luxury of having both the CIO and CTO.  Small to Mid-Sized Businesses (SMBs) rarely have the luxury of affording two executives.    Many CIOs lack the technical skills to build contemporary IT efficiently.  Conversely, many CTOs lack the business skills to build a technology portfolio that best matches the organization’s needs.

The idea of of an off-shore CTO working under the direction of a CIO to help architect and deliver a technology platform does appear to make sense, particularly in light of the fact that many technology solutions are in fact developed off-shore.  A few guidelines for successfully off-shoring the CTO services:

  1. The business drivers must be articulated on-shore by a CIO or equivalent;
  2. The off-shore CTO must be co-located with the implementation team;
  3. The off-shore CTO must provide PMO functions to ensure successful outcomes;
  4. The CTO must be fluent in the enterprise architecture; and;
  5. If the development team is outsourced, the CTO function must not be from the same outsourced entity.  This will help ensure that the CTO’s loyalty is to the enterprise and not to the outsourced entity.

Off-shoring a CTO is not necessarily undertaken to reduce costs, rather it is to help minimize the gaps between the desired outcome and the delivered technology platform. The capability of the CTO determines the success of the engagement.  Fortunately, with the large number of engagements that have involved on-shore and off-shore projects, it will not be difficult to locate competent CTOs.  Many qualified CTOs in Europe/US may themselves avail of off-shore engagements further boosting the pool of available CTO resources.

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