The Evolving Role of Virtual CIOs, with Jeff Roberts

strategy and more. Now let's get into today's discussion on what matters in IT.

hosted together. I'm happy to see podcasting again.

buzzword, alert, digital transformations. Jeff, welcome to the IT Matters podcast.

interesting AI and analytics in particular. But during that period, I was sort of offered this opportunity to step back and think about what I wanted to do next, while I still had a paycheck, and I took advantage of that, and the idea of starting a consulting practice had been on my mind for really five to five to 10 years before I felt like certainly there were other firms out there offering fractional CIO that was the most common sort of label at that point, but I knew some of those

organizations, and was troubled a little bit by the way they went about things, and felt like I had an idea for a different approach that would let us make a better match for each client and really bring the expertise to the table that a lot of companies need, even when they don't have the budget for a full time CIO, a lot of companies are at a size and scale that they really need the expertise, and someone who knows what they're

doing can really move the needle for companies like that. So that was the idea in the genesis of Innovation Vista.

together. So you start a consulting practice, you you go and hire some expert consultants, or maybe the founder is one themselves, but they hire a small team, and you put them on w2 and then you go find clients and projects to assign them to, to keep them busy. It makes sense. And it's, you know, 1000s and 1000s of instances where that's been the pattern. And those people you hire are probably really smart, right? You go, you have good criteria. You know, what makes a

good IT executive versus what doesn't. The problem is, and the square peg, round hole comes in, where clients need different things, and they operate in different industries, and someone who's successful in one space or even in the same industry, but they're successful maybe in a company that's very formal, you know, lots of committees and oversight

structures, things like that. They're not necessarily going to succeed with a company that's got a different culture, and especially one that's in a different industry, and I really feel like, especially in the 2020s here, this has become even more true that being an IT executive is really about being a business executive. It's understanding with our business model, where do our revenues come from? Where do our costs

come from? What sort of efficiencies would really move the needle versus sort of bell and whistle, kind of capabilities that we need to not waste our time on, and that industry knowledge is critical. So I heard, I don't want to name

any names, but I heard some horror stories. Let's put it that way, from both sides, from clients of fractional CIOs who thought they were hiring someone really good, reputable, smart, and they were smart, but it was just this mismatch problem that you know, all all of the unspoken assumptions, all of the lessons learned that they're bringing to the table, maybe as a as a hospital CIO, for example, if they're trying to work for a manufacturing company, it's just different.

It's so different in ways that you can't even put your finger on, necessarily, to know, to you know, have an open mind about so they walk in the door and they have to spend the first couple of months learning the business, and even after that, they don't really get it in the same way that someone gets it who spent their career in that space. That was really the key insight that I had, is I don't want to build a bench. I want to build a network. I want to know really good consultants that I could

pull in for a project. So literally, we have never built a bench, starting 2019 when I founded the firm, I don't intend to, I get told by financial consultants and my accountant that my margins are not what they could be if I was willing to do that, which I'm sure, I have no doubt that's true, because subcontracting is is just more expensive than putting someone on w2 it's the nature of the economics of that. But I'm not willing to make that trade, I guess, because structuring it

like this gives me a choice. Right now, we're over 400 consultants in the network, so I have over 400 options I can choose from. Whereas a firm that has hired a couple of people for the bench, they have whatever two or three or one, even if they've got one consultant that's not billing a client, they have that ongoing fixed cost, they know they need to keep that person busy and generating billable hours. And so guess who gets assigned the next client that walks in the

door? So I saw that problem. I heard about it from the consultant side as well, where they felt like they were set up to fail in many ways, and the sales team had made promises that they weren't even aware of or comfortable, that they could fulfill. So starting on Innovation Vista, I wanted to really just start out differently, in a way that didn't box me into this corner the way so many firms are.

your consultants are coming in as fractional or VCIOs. What do you think is the hardest thing for a VCIO or fractional CIO to get right when they come in, besides what you just said, the match, and making sure they have the experience after that, and you've vetted that out, what is the hardest thing for them to do, to to make this a success? Or, you know, where you know it immediately isn't going to work?

likelihood that you succeed is just extremely low. And so this idea that you're hiring a consultant because of their experience, their approach, their ideas, their wisdom, but there's a humility that's needed when you walk in the door to not sort of arrive, like there's a new sheriff in town, and you all report to me now, by the way, and you haven't been doing it right. I'm here to make sure that you start doing it right. You know that sort of beginning to the relationship is

impossible to make work. So I think it's more art than science, but that building of trust for virtual and fractional CIOs is even more critical. If you come in as a new permanent CIO, there's this idea that, all right, the organization is committed to this person, and we all need to sort of make this work. So maybe there's a little bit more of a honeymoon period and a little bit more of a willingness to get to know each

other. You come in as a consultant, you know you have to come in and hit the ground running, in some sense, but that building of trust is just as important, because without it, you're not going to get the straight scoop. You're not going to get the facts about what's really happening and what's good

and what's bad about the current platform and processes. And when you try to make changes, you're not going to have people supporting that, and you know, they're going to find ways to sort of undercut what you're trying to do because they just don't believe in it, and they think you're maybe out for your own glory, or out to make them look bad so you can look good. Whatever it is that dynamic is just is an enormous risk. So it's one of the things we talk a lot about with consultants that

we're placing. And frankly, it's a lot of the criteria that puts a consultant in our network of 400 versus being one of the 800 plus that are not in our network that we've concluded we would not want to put this person in front of a client with the name of Innovation Vista consultant.

surpassing the amount of our invoice every month. And you know, there's, there's a rocket science around fractional and virtual executive work of how many hours a week are we spending, and we try to really zero in on that for both sides, right? The company wants that bill to be as low as possible, but the consultant needs the time that they need in order to really succeed. And I don't want to make promises that they have to fulfill and spend time they're not being compensated

for. So there's this constant sort of tension with that. And you know, we find that if it's an advisory engagement, you're a sounding board, maybe with the head of IT or the board of directors and CEO that can be as low as four hours a week, and you can be affected. You're maybe participating on a call or

two, you're doing some research and emails in between those. But if you're leading it like a virtual CIO is doing, it needs to be at least 12 and maybe, you know, 15 to 20 hours a week, because either you have staff, or, more likely, you have staff and vendor partners that you are overseeing, and there's collaboration with the business executives that are there so

that that that ends up putting the bill at a certain level. So we find 50 million and up, 200 employees and up is the size of organization where we really can bring that value, where we know we are saving them or even helping them gain revenue more than what we're charging them, and they're not at a size where

it's really clear they just need a full time CIO. And there's sort of this sweet spot in the middle there, from we it's different on depending on industry, depending on whether they're knowledge workers, or if you've got property, plant and equipment sort of company, the revenue versus knowledge worker staff count is different. But, you know, call it generally 50 million to about a billion or a billion and a half on the high end is the range where we tend to succeed. And our clients say,

you know, we this is tremendous for us. What other ideas do you have? We want to extend you.

contractual, subcontracted on 1099 like I talked about. But the matchmaking of it's not just industry and technical experience, right? There's this idea of formality and the temperament, and in some sense, what part of the country are you in strange to say, but you know, culturally that matters to some people, they just are going to feel a little bit more of a vibe with the rest of the C suite, versus being a fish out of

water. So there's a lot that goes in, and that's why, you know, really is as big as we can get our network with good consultants, the better, because it gives us more and more options from which we can choose.

Change was a part of the the culture in that part of the country and and then he decides, hey, you know, I'd like a slower

pace of life. Let's move to small town in South Carolina, and change is very difficult for some in this part of the world, and and it's it's certainly a shock, but I could see how, if you bring in a an IT leader that's very used to that, that quick, quick clip of change from the West Coast that's going to come to the southeast and expect everyone to change it at their pace, that there would be a mismatch there.

Fill in some of those details until they've put something out for a proof of concept. They've used it in the real world, right? The whole agile kind of mindset, especially around software, you know, in other organizations, you've got to come with a slide deck that's 80 slides and have everything fully baked on. How are you going to design it? How are you going to build it? How are roll it out before you ever take

step one to get that budget approved. So it's, it's all of those sort of dynamics that I really enjoy about the matchmaking aspect of what I do. And and seeing a client this just really thrilled with the consultant. We send them. And, you know, I check in with with feedback, both with the consultant and the client, as you can imagine, and when I hear good things. And hey, we want to extend them. And man, we really seeing the value of what they're bringing to the table. That is,

I don't know that's fun. That's just a lot of fun for me.

processes, or the structure, vendor partners, whatever. So we tend to say month to month, and you will see value either already delivered, or you will see it on the horizon that you know we really put the ball in their hands to say, look, and if you don't see it, then let us know you you would like to cancel and and you should cancel, because this whole thing is about ROI. You know, if you're spending money with us,

as an organization, so they'll know it when they see it. And that's why we like we really like that month to month and we like hyping that month to month structure, because it sets us apart from some competitors as well, who want you to sign up to say, look, we need at least a year for our person to get their feet on the ground and for you to see the value. And I don't

like that. I don't think it's true first of all. And I think it sort of sets the wrong expectation that they might be unhappy for a while, and then, you know, they're going to feel better by the time 12 months rolls around. I'd rather them feel good from the very beginning. And, you know, it's, it's not some immediate harvest basket that we bring to them of

dollars, but there's enough there. And they get a sense of the thought process that when they're up for renewing for the second month, it should be a no brainer, and it is for our clients. So that's a great question, though, and it's one that, you know, there's a lot of sort of preparatory work that goes into, what are we promising? What are our deliverables? Sometimes it's, you know, strategic plans, documents, roadmaps, things like that. And sometimes it's

leadership. And we're doing some of that planning and analysis, of course, to know how to lead. But you know, is a virtual CIO doing a good job. There's like 50 different things that go into answering that question. to month approach, and then you set expectations to say, here's how we're going to get there, and it depends on the organization. What's it? I mean, you don't share names and redact

anything you want, but maybe help us. Give us a specific example of an organization where you saw either quick or relatively quick success. And what did it relate to? Where did it fall? How did you guys identify it so quick?

gotten used to it, to be honest. So IT was not what it should be, that tension ended up blowing up to the point where the head of IT resigned, like unexpectedly, I'm out of here, sort of thing.

And so we're brought in, sort of in firefighting mode. And so there's not, you know, I would say it's 88% of the time when we're brought in, we're brought in to do an assessment and recommendations report, and we have a process for that, and it takes three to four weeks, and we deliver back something that kind of tells them where we think they are and what we think that they should do. And then from there, they often say, that's this is great. Can we have your help to make it happen

in a firefight? You don't have the benefit of that. You got to jump right in. We need someone to grab a steering wheel. That person is not in the building. There's no one that we feel comfortable knows. You know, the six or seven areas of it, and we have people that know their area, but no one that can do this. So we come in as an interim, and our consultant does a fantastic job of, sort of putting out the immediate fires, triaging the sick patients, is how he talked about this a lot.

So there's, you know, there's immediate surgery or this patient's going to die. There's, you know, hook them up to an IV, and we need to get to them next. And then there's okay. This over here, it's actually okay. These processes, these platforms, seem workable, and nothing urgent needs to be done. And that very quick, professional sort of approach. I mean, I talked about taking a month to do that in the firefight mode. He did that within a week or two, very successfully, in a way that the

leadership team saw his thought process. You know, why is this needing immediate surgery? And if some of it was having to spend money. Why are we spending the money? What are the ways we might spend money? Why am I recommending this specific way? They just really liked his thought process, and they saw the wisdom and the expertise there. And that is a client who's been a client of ours now for over four years. Because that interim turned into an ongoing. You know what? We would

just love to have this person continue to fill this role. He likes them. They like him. You know that that's a great sort of

success story. They're all different, but that's an example of one where it's it's just the difference between someone who knows what they're doing and has that professional approach can make all the difference versus, you know, even average or mediocre, you know, you make some missteps, and those are painful, and then you got a client that says, I mean, I don't know, it feels like maybe we could get someone better

somewhere else, right? We want clients to say, this is we can't actually imagine that we could find a better fit than this person.

our network. And so I try to get a sense of some of the intangible things that are not on the resume, some of the leadership communication. Do they have a backbone? If they have a backbone, is it overdone to the point where they might come off as abrasive or arrogant? Are they too much of a pushover, where I need to think about sort of a farmer, kind of engagement for them? Maybe they're really great technically. But if we've got an organization that needs change

and it needs the winning of hearts and minds. That's not going to work right? So there's a certain temperament, professional assertiveness, I call it, that I can tell someone could be diplomatic about it, but, but they're not going to give up. If someone says I don't know that we're comfortable with that. They'll just continue to build their case. Understand what's important to that stakeholder. Let's work on that.

Let's let's begin to win hearts and minds and turn ship. And that is, it's a difficult thing, but for those that are capable, it's also really probably the most satisfying thing that you can do is a turnaround of an organization. You know, you know it, if you've seen it right, it's, it's just this feeling, you know, you walk or in the virtual world, you talk with people about how things are going a year later, and you just have this feeling like, you know, I did that. This would

have been chaos a year ago, and now we've got a process. People are aligned, people are happy, people are staying. Things are working right. And so that's, that's a fun, fun dynamic.

customers away from you with their technology. They're out there thinking about how they can create digital products to upsell their customers, how they can create a capability that no one else in your space can match, and begin to pick off customers one by one from everybody else and just really disrupt the space so it, you know, technology has gone beyond this utility, light switch kind of function, enabling function,

some companies call it. That's not what it is anymore. And that's why we have the tagline, innovate beyond efficiency, because we hear so often, you know, people that think, Oh, we're fine. You know, our system is actually fairly efficient. And so I challenge that, you know. And similarly, it's not all about that. If that's all you're settling for and you're telling your head of IT, good job, because we're efficient,

you're missing it. You're really missing it. In 2024 you were missing it even in 2015 by the way, in some industries more than others, but in 2024 it's every industry. If you're not thinking about AI, if you're not thinking about you know, what deals did we miss? What transactions or revenue did we

miss? Where technology would have been a difference maker, and if your head of IT is not at the table, even asking those kind of questions or leading those kind of discussions, you have the wrong person, or maybe they're good at what they do, but you don't have the right person in the room. And so yeah, it's a hard question for companies that have a director of IT. For example, we see a lot of this person's been there for over a decade, maybe homegrown, right? Came up from a help desk.

Everybody loves them. They know where all the bodies are buried. They're running everything. And I always say that's great, but you know what that means? They haven't seen anything else for the last 10 plus years, except for your shop. I don't know if that's great. I think it's probably not great. So what about the value of someone, even as a sounding board to that person, to expose them to what's working for other organizations?

Other ideas, new ideas, things that are now feasible, possible, affordable, that were completely impossible or impractical, even just two, three years ago, they need to know about that, and not just from going to a conference and hearing some, you know, talking head at the podium, someone that they're going to hear it from, someone who's taken the time to get familiar with their company and Their platform as it is, to really know what's possible and what the next steps might be. So our

answer is, of course, yes, there is a size. I said earlier. There's a size where we just would kind of turn away, or we'll say, look, Sign us up for an advisory thing, and let us just be sort of the idea person for a while. And let's try that for a few months, four hours a week, very cheap, like, you know, $1,000 a week. Think about to bring in this next level of expert that's been around the block that you're trying to go

around multiple times. And let's just see, and maybe the ideas are valuable enough, and we size it right, that your person can take the ball and run with it. And all they needed was a little perspective. Maybe they're not capable. Maybe they're really strong on infrastructure and operations, but they're they just don't understand the concepts around systems, data and analytics. Maybe we need to mentor them. Maybe we need to

supplement them in some way. Or maybe you need us as a virtual CIO for a very small number of hours a week, and this director of IT can report to them. That's a long answer to that question, I know, but it that's sort of the conversations that we have when people are skeptical that that they need someone because our IT is okay, our stuff works. You know, we're not crashing. I think we're better than than most like, if that's all you think it's about. You're missing it.

lot of what Opkalla does. This is, this is what we do on a day to day basis. We our team engages the the marketplace of vendors. We have over 1000 are in our portfolio that we evaluate, and it's a full time job to keep up with, who's bought, who, who's good at what, what you know, what what services are should we avoid for now? How are organizations going about their digital transformations? What are some stories that we can learn from? It's it's that it's about

building that network. Like you said, it was more and more important today than ever before.

understanding the right tools, vendor partners, processes, methodologies, that that stuff is all applicable. And you're right when you say it's changing. It's changing faster than ever. It's accelerating the pace of change, which is really scary. And, you know, we try to use that to encourage people to act now, because it changes never been faster than it is right now, and it'll never be this slow again. And that is, that is a daunting but it's it's been so true. I mean, looking

back on 2020 What a shock and change that was. I mean, think about 2023 2024 what's happening with AI is more disruptive than what happened with the pandemic and having to close. And you know, in some ways, because it's the difference between survival and failure of more organizations. It's just It's shocking. So if ever consulting made sense, it makes sense in 2024 I have a biased opinion, obviously, but I feel the same

about your services. You know, this guidance of who should we really be looking at and just help, maybe on like, what are the finalists that we should consider for this sort of solution? The value of that has never been higher.

They're saying, hey, we want to innovate. We want to transform. Okay, great. But like you said, if you've never done it, you've been an organization. Where you've never had to. Doing it on your own can be a daunting task. You don't need to do that. There's folks like you out there, there's folks like us out there, engage and ask like because we've seen it 100 times,

1000 times, 10,000 times. You, you, you all too. And so just like as children, we rely on our parents to share, share with their experiences of life, so that we don't follow in the same traps. It's the same thing in this space. So I appreciate your

perspective. I have one final question, and I think Keith will wrap up here, but you know, in the in the traditional thought of a CIO, and I think this is more, I would say this is more a thought of the past, but I think people still sometimes feel this way. You mentioned the utility versus the the actual business officer, which I think it really is, but risk is always really

interesting when you think of the CIO role. CIOs are responsible for systems that have to be up cybersecurity that has to protect and so in a typical organization where the CIO is there, they sometimes can fall as a scapegoat with risk. If it's you know, it happens. How does risk work with VCIO? And how do you guys handle risk and manage risk as VCIOs for organizations?

that's another one of our taglines. I love that, but it's so true because you're you're not needing 40 hours a week of someone's time to turn the crank on some machine run some process. It isn't about that. The highest leverage functions of an IT leader is the strategy, the architecture, the culture, negotiating your agreements and setting the standard for processes and operations. You don't need to run it. You need to make those key decisions in a very wise way with your eyes

open towards the risk. To your point, you know you don't have to, you don't have to hit all risks. You need to be aware of them. And so a lot of this comes down to that, that experience and the awareness of the landscape of, you know, threat vectors on a cyber security basis, stability. You know you can design things like a hospital or like NASA, if you want triple redundancy in every possible system and requirement, you're going to spend an awful lot of money doing that, though.

So understand, like a business impact analysis, sort of mindset of, okay, what are these risks? What would happen if this occurred? Really, what's the likelihood and what's the impact, and making a commercial decision about those things? So if something bad happens, and you've gone through that analysis, and you say, look, that it's okay, the solution to avoid that would have cost us more than it's getting ready to

cost us to just go fix it so it's all right. We made that purposeful decision six months ago or whenever, that makes people feel so much better, versus being hit with someone being hit with something that no one saw coming right your middle manager or your vendor didn't ever come to your leadership team and say, you know you need to be aware that there's a certain percentage possibility of x, and if x happens, you know

here, here's going to be your impact. Just knowing and navigating that, again, in a commercial mindset, very ROI mindset, that's another value proposition of getting that expertise of someone who's been around that block. And I feel like there are a lot of smart people in middle management, so I don't say middle manager is a derogatory it just means that they're they probably are limited in what they've been exposed to. You know, people come up the IT career ladder,

generally one side or the other, right? It's IT, and operations, cyber security, maybe. And then it's systems programming, project management, data and analysis. And that's oversimplifying significantly. But you know, you have a middle manager. They're they're still on their way up that ladder. They know one side of it. To some extent, they're probably completely blind on the on the other side of the ladder, and that's a risk that, you know, a lot of organizations just should

not be running. And unfortunately they are.

that fits on a billboard. You know? The innovate beyond efficiency, tries to capture that whole concept in one catch phrase, but I it's more of a problem with IT leaders than it is with business leaders, and it's the way we're trained. And there's all kinds of reasons why that is, but it's sad and it's career limiting for a lot of these very smart people that if they just realize there's more to it, they shouldn't be getting an A plus grade if all they're doing is keeping the lights on,

go in and talk to the CFO. Go in and talk to the CRO understand what's happening in your organization and where IT can move the needle.

from people, anyone who just wants to to chat. You know, there doesn't need to be some kind of virtual CIO engagement in the offering. I'm happy to have a call just to talk about these things because I love the topic.