CEO/CIO Communication and the Strategic Grid Dimensions

Abstract

McFarlan’s strategic grid postulated that the impact of existing information systems and impact of the portfolio of planned information systems constitute two dimensions on which the chief executive officer and chief information officer could assess their information technology. But what predicts their agreement on those impacts? Mutual understanding between an organization’s CEO and CIO is an important factor in the organization’s efforts to gain the greatest value from information technology, a factor that communications theory predicts, moreover, can be the product of greater communication frequency and channel richness. This research used a postal survey of 202 pairs of CEOs and CIOs to investigate the effect of such frequency and channel richness on CEO/CIO mutual understanding of the impact of existing information systems and of the impact of the portfolio of planned information systems. More frequent communication between the executives predicted mutual understanding about the current and future impacts of IT. However, the use of richer channels did not predict mutual understanding about the current impact, but did predict it about the future impact when the extent to which the organization relied on IT to support future projects was used as a covariate. Moreover, the finding that CEOs and CIOs perceived e-mail to be a richer communication channel than telephone was an unexpected outcome of the research. From a research perspective, the study extended theory about communication frequency, media richness, mutual understanding, and the impact of IT in organizations. It also provided additional validation of existing instruments that can be used to help future researchers of communications and IT. It provided direction for CEOs and CIOs who may be interested in increasing their mutual understanding of the impact of IT, improving their relationship with each other, and thus improving their planning of new information systems.