Technology has become integral to running nearly every business. As companies grow, they eventually need someone to manage that technology. Above and beyond mere maintenance of technology, businesses need a person to be responsible for driving the business forward utilizing new technologies and for streamlining the company’s existing systems and processes. Inevitably, someone in the company will fall into this role, usually the CFO (Chief Financial Officer), CEO (Chief Executive Officer), or a business owner. However, these people will likely not be optimized for this technology role because most CFOs and CEOs are not interested in managing IT, let alone being the driving force championing technological advancements. Furthermore, these are highly paid employees and adding any roles to their job description splits their time, making them less productive at their primary role.
For this reason, many companies have added the position of CIO (Chief Information Officer) or CTO (Chief Technology Officer) to their ranks, but this promotion can be cost-prohibitive for many SMBs (Small and Medium-Sized Businesses). That is why the vCIO role came about.
vCIO is an acronym for “Virtual Chief Information Officer”. The vCIO is an outsourced CIO for companies who do not need or can’t afford a full-time C-Suite executive’s salary and benefits, but still needs someone with the knowledge and expertise to manage the company’s IT staff and infrastructure while having a deep understanding of the business and its goals.
Please note that a vCIO is not necessarily an IT manager. The key difference between a vCIO and an IT manager is the understanding and focus on the business. Most IT managers are great at IT but may lack the business application aspect of technology. A vCIO does not need to be technical at all; a vCIO needs to understand how the business can leverage technology to its benefit. With that said, what exactly does that mean for a company?
For starters, a vCIO will immediately lift the burden off the CFO, CEO, or business owner of worrying about the minutia of IT and trying to stay on the cutting-edge of technology. This will allow the company’s leadership to get back to the important matter of running the business.
A vCIO will analyze the company’s IT environment by performing a full and in-depth audit of the entire infrastructure from the bottom up. They will then continue that process on a regular basis. Not only will this reveal areas where best practices, industry standards, and federal compliances are not being followed, but it also allows the vCIO to suggest changes to increase network security and employee productivity. The goal is to change IT from a cost center to a profit center for the business.
This shift rolls into their next duty, which is creating a technology budget that forecasts IT requirements and technology advances into the foreseeable future. To do a budget, a vCIO must know industry trends and stay up-to-date on new technologies. A vCIO creates business cases focusing on ROI (Return on Investment) and how that technology will create competitive advantages for the company. The vCIO will present these proposals to the company’s C-Suite for approval. Once approved, they become the spearhead for implementing those changes.
As the top IT executive, the buck stops with the vCIO. It is their responsibility to make sure their team, whether they are in-house or an outsourced MSP (Managed [IT] Service Provider), is efficiently managing the maintenance of the company’s systems and resolving issues in a timely manner. In this regard, they will create reports showing trends and use those statistics to give the rest of the C-Suite clarity about their IT environment. Providing transparency and being able to explain technology in laymen’s terms are hallmarks of a good vCIO.
So, what is a vCIO? In short, they are a competitive advantage. They are also a greater return on investment than the higher paid employee or full-time CIO for most SMBs (Small to Medium-sized Businesses). A vCIO is the person who delivers strategic technology direction to increase the company’s efficiency and profitability in order to help achieve the business’s goals and objectives.