In today’s fast moving tech world, great CTOs have achieved truly mythical status. Think Adrian Cockroft, of Netflix, who drove Netflix’s cloud adoption for streaming video, or Werner Vogels, who invented and continues to build out Amazon Web Services, the world’s most successful Cloud platform. Every CEO who is building the next big thing wants a CTO like Adrian or Werner on their team to conceive those breakthrough products. Every CEO needs an expert technical manager that can lead the effort to get those products built, delivered, enhanced, and supported. It’s almost impossible to find both in the same person, because it is almost impossible to do both jobs at the same time at scale.
In the Beginning
When most companies launch, the only permanent technical person on board is a hands-on developer/CTO. This is the person who can take a sketch of a minimum viable product (MVP) and rapidly create a working model of the product using available components, services and capabilities. It’s a person who can help drive a lean startup from concept to launch. This description fits almost every great startup CTO I’ve met. Hands-on CTOs build the prototypes and early versions. They iterate and improve. They inspire small, elite teams, but they don’t build out product portfolios or figure out how to build a platform that is easy to support and inexpensive to operate.
As a start-up moves into its growth stage, the role of the CTO changes and risks emerge. The demands of the market, closing deals, working with partners, briefing analysts, and working conferences and trade shows becomes a full time job. The CTO must become externally focused. At the same time, the CTO is managing a growing and more diverse team. Therefore, the CTO spends more time managing and schmoozing and less time inventing. When the engineering team hits 15 to 20 people, it’s a safe bet that the CTO won’t be spending much time on inventing new products at all. It’s also a safe bet that he will be pretty unhappy about it. At this point, it’s time to consider adding a new, senior-level role to your team that can be internally focused: The VP of Engineering.
At first glance, it appears that you’re adding a duplicate, expensive role to your org chart. You’re not. You’re adding a force multiplier who can drive the engineering team to create great products that meet the market demand. Here is my best take on the roles of CTO and VP of Engineering.
The CTO is the #1 technical guru of the company, bringing deep insights into the underlying technologies and key capabilities built into your products. The CTO is also your thought leader and stays abreast of cutting edge research and development trends in your target market. The CTO loves technology and often takes an early leadership or technical role in developing new technologies and products. Frequently, the CTO oversees a small group of engineers devoted to R&D in next generation technologies and protecting the company’s IP by working with legal counsel and others in the company to build a patent portfolio and establish trade secrets.
The CTO has heavy influence into the technical strategy, which they co-develop with the VP of Engineering and the Head of Product, and will serve as the technical face of the company at industry conferences and when dealing with the analyst community.
The VP Engineering role is much more varied and is more about delivering products on time and on budget with good performance. Key duties include:
- Personnel management – For teams of less than 12 people, the VP Engineering is usually the direct supervisor of the technical staff. For larger teams, the VP of Engineering often manages a team of managers who oversee teams that are aligned along product and functional lines.
- Program management and engineering execution – The VP of Engineering is responsible for converting product vision into well executed products. There is usually an overall approach that brings together all inter-dependencies between the functional disciplines (e.g. mechanical, electrical, controls, software) needed to build the product. He is also ultimately responsible for interactions with other departments, such as sales, marketing, and finance.
- Technical leadership – The VP of Engineering works directly with the CTO daily to develop and maintain the technical roadmap for the Company. This is the case both for new products that may get built and existing products that need to be enhanced. The VP Engineering may personally serve as a systems architect, but, as the business grows, the VP of Engineering will likely hire one or more full-time architects to work across the product portfolio.
- Strategy development – The VP of Engineering is a member of the management team and works with their peers in other departments (e.g. VP Marketing, VP Business Development, VP Manufacturing and Ops) as well as the CEO, CTO, and COO (if present) to develop company strategy and product strategy.
- Professional Services – The VP of Engineering may need to create a professional services capability for B2B offerings to drive adoption of the product, coordinate with system integrators and partner integrations. Without this capability, the cadence of the development teams will be frequently interrupted by these demands.
- Product operations – For SaaS products, the VP of Engineering will establish the product deployment, operations and technical support capabilities and operationalize the products.
- Vendor management – The VP of Engineering is responsible for managing vendor execution and delivery of the technical vendors. These can range from cloud hosting, content delivery networks, telecom, software vendors and support, outsourced development, recruiting and more.
- Financial Management – The VP Engineering also manages the budget for the engineering department, which is often the biggest cost center for a technology-driven startup. This includes headcount, outside consultants, prototyping costs, supplier management, equipment cost, travel and entertainment, professional development, patent costs, and more.
finally, the VP of Engineering should NOT be responsible for back-office, internal IT, desktop/laptop support, and communications infrastructure. All of these functions should be consolidated under Finance & Administration until the company grows to the point where it needs a CIO, which is a discussion for another post.