Chief information officers and other technology executives are seeing higher rates of compensation in 2014. It is largely driven by improved earnings.
The 2014 TechTarget IT Salary and Careers Survey of 333 senior IT executives across North America found “Nearly two-thirds (64%) of IT executives got pay increases in 2014. The average salary of $143,942 was 4% higher than the $138,269 earned in 2013. The average bonus was $35,427, up 13% from the $31,471 of the previous year. In addition, more IT executives received bonuses in 2014 — 46% compared to 43% in 2013. Total executive compensation added up to an average $177,229, compared with $164,090 a year ago.”
According to a Forbes.com article, in 2012 the highest paid CIO in the country was Filippo Passerini, who is CIO and President of Global Business Services at Procter & Gamble. According to Forbes, “He has been essential in providing data that feeds P&G’s digital war rooms, which allow leaders from across the globe to gain clearer insights upon which to base better business decisions. He earned total compensation of $4.9 million.”
He was closely followed at $4.8 million by Rob Carter, who was CIO and co-CEO of FedEx Corporate Services in 2012. (He gave up the latter title in 2013, and is currently the CIO only.) “Like Passerini,” the article said, “Carter has been a veteran with his company, his technical prowess only surpassed by his business acumen, and thus the rationale for him to be the co-head of Corporate Services is excellent.”
The upward trend in pay doesn’t surprise survey respondent William Floyd, CIO at Gold’s Gym International Inc. IT executive compensation has ticked up in the past two years after several years of stagnant pay. “I think there is a little bit of makeup going on for the declining salaries and no bonuses until 2013. That’s when IT got hot again and companies realized, ‘Oh wait, we’re going to lose these people if we don’t do something,'” Floyd said in the TechTarget.com article.
The article finds that higher compensation may be paid because the CIOs played a key role during lean times. It says, “CIOs were due for some payback said Subbu Murthy, consultant CIO at BCCI Construction Company and since 2005, the CEO of UGovernIT Inc., which makes analytics software for managing IT. During the recession, IT executives not only did more with flat or lower IT budgets but also used technology to offset layoffs and hiring freezes by automating business processes and driving efficiencies. ‘There’s a lot of IT backlog. Executives feel that the CIO bailed them out in hard times — now it’s time to reward them.'”
The research also shows that CIOs are making more money because they are facing increased responsibility for business results. “The increasingly important role IT executives play in achieving business results was apparent in this year’s survey,” TechTarget said. “‘Helping achieve a business goal or outcome’ was listed as a top measure of job success by 56% of senior executive respondents, up from 47% a year ago.”
According to the article, “Aside from achieving business goals, the other top compensation metrics were: improving a product to service (39% ranked it in the top three, up from 34% in 2013); completing projects on time (no change from a year ago at 34%); and achieving ROI on projects and tech purchases (20%, up slightly from 18% in 2013). “Meeting productivity goals,” dropped dramatically as a top metric, ranked in the top three by only 16% of IT executives compared with 32% in 2013, suggesting the heavy lifting on that score has been done. “Coming in under budget” also declined in importance, ranking as a top compensation metric for just 14% of respondents, compared with 19% the previous year.
Get started with the VocaWorks Tech Hiring platform
Curated talent, vetted employers. Learn more and sign up for the VocaWorks tech hiring platform.