What Is a Chief Technology Officer (CTO)?
A chief technology officer (CTO) is the executive in charge of an organization's technological needs as well as its research and development (R&D). Also known as a chief technical officer, this individual examines the short- and long-term needs of an organization and utilizes capital to make investments designed to help the organization reach its objectives. The CTO usually reports directly to a company's chief information officer (CIO), but may also report to the chief executive officer (CEO) of the firm.
- A chief technology officer (CTO) is an executive who is responsible for the management of an organization's research and development (R&D) as well as its technological needs.
- As of early 2021, the average base salary of a CTO is $163,255.
- Depending on the company, a CTO may play one of several roles, including strategic planner, customer relations liaison, and overseer of infrastructure.
- Becoming a CTO often involves at least 15 years of IT experience, along with a graduate degree and certifications in computer sciences and business administration.
Understanding the Role of the Chief Technology Officer (CTO)
A chief technology officer (CTO) is the highest technology executive position within a company and leads the technology or engineering department. They develop policies and procedures and use technology to enhance products and services that focus on external customers. The CTO also develops strategies to increase revenue and performs a cost-benefit analysis and return-on-investment analysis.
Originally a chief information officer (CIO) previously performed dual roles as CIO and chief technology officer (CTO). However, as technology continued to advance, there was a growing need to separate the CIO job into two roles to ensure a company's success. Hence, the development of the CTO as a separate position.
How do the two differ? Despite the titles, the CTO has more of an outward-looking, strategic planning role, while the CIO has more of a technology-focused, operational role. Generally, a CIO is responsible for technologies that run the company's internal operations and business procedures. The CTO is responsible for technologies that grow the business externally, implementing services and products that serve clients and customers.
Many large corporations need both a CTO and CIO, while smaller companies tend to have one or the other. The choice depends on the company's vision and budget.
As technology focuses more on integrating applications, processes, and the Internet of Things, CTOs must keep abreast of big data, streaming analytics, and cloud technology to remain innovative and stay competitive.
Types of Chief Technology Officers
While research and development have been a component of businesses for many years, the rise of information technology (IT) and computers has increased the importance of the chief technology officer. Companies focusing on scientific and electronic products employ CTOs who are responsible for the oversight of intellectual property and have backgrounds in the industry.
But the responsibilities and role of the CTO also depend on the company. There are typically four different kinds of CTOs, whose main duties may differ.
This CTO may oversee the company's data, security, maintenance, and the network of a company and may implement (but not necessarily set) the company's technical strategy. The CTO may also manage the company's technological roadmap.
This type of CTO may envision how technology will be used within the company while setting the technical strategy for the company. This CTO will also look at how to further implement new technologies within the company to ensure its success.
In this role, a CTO will act as a liaison between the customer and the business by taking on the responsibilities of customer relations, getting a grasp on the target market, and helping deliver IT projects to market.
This kind of CTO will help set up the corporate strategy and fuel technological infrastructure, will analyze target markets, and create business models. Additionally, the CTO will have a close relationship with the CEO and other members of the company's senior management.
Becoming a Chief Technology Officer (CTO)
As with most jobs in the IT industry, the path to CTO starts with a bachelor’s degree in a computer- or information science-related field (computer programming, software development, management information systems, applied mathematics, cybersecurity).
Many firms also prefer their CTOs to have M.A.s: master's degrees in computer sciences, information technologies, or technology management. Given the fact that CTOs often focus on products for customers and customer relations, sales, and marketing courses are often useful as well. Many chief technology officers have MBA degrees, reflecting the significance of IT in strategic corporate planning and business goals.
On-the-job, practical experience is important: Most CTOs have worked their way up the IT ranks at different organizations. Industry certifications, if not crucial, can significantly enhance an applicant's credentials as well.
A chief technology officer is a high-ranking executive-level position in a company, part of the senior-level, "c-suite." So applicants may need more than 15 years of experience in the IT field before being considered for a CTO job.
In 2021, annual salaries for CTOs range from $89,000 to $246,000, according to Payscale.
The average base salary of a CTO in 2021, according to PayScale.
The U.S. Bureau of Labor Statistics predicts that the job outlook for CTOs, along with other computer and information systems managers, is good: Employment is expected to increase 10% between 2019 and 2029—much faster than the average 4% for all jobs.
The continued growth of business conducted over information systems is the main cause of employment growth in this role. Rapid advancements in business solutions and growth in mobile device usage and cloud computing usage have also contributed to the expected increase in job openings.
In 2009, the White House announced the appointment of the country's very first CTO, an official in the Office of Science and Technology Policy. This official's main focus is to use technology to help stimulate job creation, improve healthcare and security systems, and increase broadband access. Aneesh Chopra was the first CTO of the U.S.
Chief Technology Officer FAQs
What Does a CTO Do?
Chief technology officers (CTOs) evaluate new technology and implement it to launch or improve goods and services for their firm's clientele and customers.
Are CTO and CIO the Same?
The CTO title has been in use for over 10 years, but there is still confusion about the role and how it differs from the CIO. The title first developed at dot-com companies in the 1990s and then expanded to IT departments. The CTO role became popular as the information technology (IT) industry grew, but it is also used in other industries such as e-commerce, healthcare, telecommunications, and government.
Although there is overlap between the two positions, since both deal with IT, CTOs generally look outward, using technology to improve the company's customer experience—the use of the goods and services. CIOs generally look inward, developing and using technology to improve the company's procedures and operations.
Who Does a CTO Report To?
CTOs often report to CIOs. However, they may report directly to a company's CEO, especially if there is no CIO position.
What Does a Chief Technology Officer Do?
A chief technology officer (CTO) is responsible for overseeing the development and dissemination of technology for external customers, vendors, and other clients to help improve and increase business. They may also deal with internal IT operations if a company is small and doesn't have a chief information officer.
What It Takes To Become a CTO
CTOs start out with bachelor's degrees in a computer-science-related field. They often earn master's degrees as well, again in computer sciences or mathematics fields—though more general MBAs are common as well.
CTOs generally have at least 15 years of IT job experience under their belts. Along with technical expertise, they must demonstrate leadership, decision-making, management, and business strategy skills.