In a perverse inversion, the split personality of Information Technology (IT) subjugates strategic application development to operational management. Surely because 70 - 90% of the business of IT is operations work*, most CIOs are operations specialists. While operations is important however, most operations-focused CIOs have no business managing application development.
To understand why, look no further than the differences between the two professions. Stability and reliability are the bedrock of operations, whose main enemy, change, must be eliminated. Drawn and managed by a few masters, detailed procedures are executed by low-skill workers to ensure conformity. Key partners of an ops leader are predictable vendors of stable technology, and peers for product reference checks, while mortal enemies are software developers and demanding customers.
By contrast, application development is about embracing and managing constant change under uncertainty. The work is a high wire act of continuous problem solving, built on experience, with acute sensitivity to local variability. Key partners are a patient customer to guide the conversion of time and money into business value, and disciplined yet creative teammates to share the load, while mortal enemies are CFO's, who see all resources as fungible, and inflexible CIO's.
Is it any wonder that app-dev under the operational CIO is trail of expensive disasters? A good operational CIO suppresses change and therefore innovation, forces vendor COTS into places it cannot possibly fit, grinds app dev leaders to paste by demanding recipes for software creation while hamstringing them with armies of cheap dolts.
It's time to break the mold: hire a good ops CIO under the CFO to keep the trains running, but hire a good VP of development under the COO to help innovate your business through judicious application of custom software. Application dev in IT departments might just then begin to approach the efficiency and reliability found in the software product industry.
* See the ITIL framework, but skip the lame section on Application Management.