Technology not quite on board

I wrote a post last week (22 September 2005, The black hole known as IT) commenting on the lack of IT and technology representation at Australian board level.

The post was prompted by an article in the Australian Financial Review, citing a global study by KPMG that found that 86% of corporate respondents to the study had experienced losses of up to 25% on technology projects.

In this morning’s subscription-only Australian Financial Review is yet another article (Agnes King, Call for CIO Board Seats) calling for technology representation at senior management levels, and in particular, on company boards.

The article quotes Egidio Zarrella, KPMG Asia-Pacific partner for information and risk management:

“The absence of tech savvy people in Australian boardrooms should rate at the top of businesses’ priorities, particularly as the nation follows the US down the regulatory road in adopting its own version of Sarbanes-Oxley.”

In particular, Zarrella raises his concern with CIOs reporting through financial controllers:

“The controls that CEOs and CFOs are signing off on… rely on IT, so why is the CIO not in the boardroom partaking in the debate about governance?”

“Having CIOs report to financial controllers is a knee-jerk reaction to overspending on computing projects, and those decisions are being made by business managers.”

As technology and the Internet becomes more and more a vital component in business operation, those businesses that meaningfully engage CIOs and technologists at senior management and board level are going to possess a significant point of competitive advantage over those businesses that do not engage technology as meaningfully.