A Chief Technical Officer (CTO) helps bridge the gap between C-level executive decision-making and technical knowledge of the product, systems, and architecture.
Think: technical leadership.
The CTO position was created in the late 80’s to meet the need for an executive who could anticipate potential revenue streams and shape corporate strategy based on the nuances of the product or service. In practice, CTOs will often have the responsibility to analyze data to make decisions about which products to promote and which to cut, determine where to allocate resources, assess the technological benefits of potential mergers, and pitch products and services to potential customers.
For some companies, the CTO tracks and analyzes trends in big data to anticipate new technologies before competitors. For other companies, they are the operations manager for the entire engineering division, overseeing the teams that create the product/service with a mind to efficiency and security. For many SaaS and IT companies, the CTO may be the creator of the company’s core technology and responsible for presenting the technology to clients, investors, and the public.
More than other executive role, the responsibilities given to the CTO largely depend on the type of company.
So what is a CTO?
In short, a Chief Technical Officer connects the technical details of a product to the rigors of corporate decision-making. The line-item description on a CTO job posting, however, will vary widely from business to business. There are at least four models for a chief technical officer position according to Tom Berray and Raj Sampath.
If you are looking to add someone with technological knowledge to upper management (or if you aspire to one be a CTO one day), here are the major differences in the way this role can be expressed:
- An “Infrastructure Manager” usually reports to the CIO—a Chief Information Officer. The CIO’s main goal is using their managerial skills to hone how effective the company is, whereas the CTO takes the role of improving efficiency for a large group of engineers or IT specialists. In this sense, the CTO is not usually an officer but more of a manager with an internal support role for the systems and architecture of a large company.
- A “Big Thinker” is preoccupied with anticipating new technology so the company can beat competitors to the punch. They are also responsible for creating new income streams to increase profitability. To do this, Big Thinkers need to analyze a lot of data, conduct assessment and testing, and make changes to the system architecture. In this role, there is usually a small or select group of engineers working closely together with the CTO.
- A “Technology Visionary and Operations Manager” continually makes **technological decisions with an eye to the overall strategy of the business. This role can be difficult because the CTO will have to balance innovation with the existing architecture and capabilities. They must make sure their novel ideas are actually executable with the current systems and talent in place. The Technology Visionary must temper the push to release new technologies with scalability—the Operations Manager side. This role is usually filled by a co-founder or initial hire who acts as a true executive in this role.
- An “External Facing Technologist” represents the product to clients. This is a real C-level role. The Technologist needs to make pivotal decisions about how to develop disruptive technologies. This CTO is expected to advise the other C-level executives based on technical expertise. This type of CTO *specializes in tracking technology performance metrics, assessing internal and external impact, *and making decisions about the overall direction of the company.
As Amazon CTO Werner Vogels points out, the two CTO roles with manager in the title are usually focused on internal support, managing large (500+) teams of engineers and IT specialists. The other two types of CTOs—Big Thinkers and External Facing Technologists—usually run a small but elite group of engineers focused on innovating product to disrupt markets. They typically need to have more interaction and oversight over other departments in the company to make necessary business decisions.
SaaS and information companies have found that it is essential to have an executive who is conversant with the technology, infrastructure, and engineering required to produce their company’s product/service. Thus, the CTO.