An Interim CIO on What Actually Works.
Mid-market companies are under more pressure than ever to adopt AI and modernize their technology. Most are going about it backwards. Here is a practical framework for getting it right.
I have had some version of the same conversation countless times over the course of my career. A leadership team gathers, usually at an offsite or a board meeting, and the question lands on the table: what are we doing about AI? Someone mentions a competitor who just announced a digital transformation initiative. The CFO asks whether the company is leaning in. A VP pulls up a ChatGPT demo. And within a few weeks, a vendor is getting time on the calendar.
I am not here to tell you that reaction is irrational. The pressure is real, the pace of change is real, and the fear of falling behind is legitimate. What I will tell you, based on having walked into more mid-market companies than I can count at exactly this inflection point, is that this is how expensive mistakes get made.
Technology decisions made from pressure instead of strategy rarely produce the outcomes leadership is hoping for. What they produce is a graveyard of expensive software that nobody uses, initiatives that stall after 90 days, and leadership teams left wondering what went wrong.
The principle I come back to in every engagement is the same one I talked about on the Middle Market Smart podcast: do not let technology be the tail that wags the dog.
It sounds obvious. In practice, it is one of the hardest disciplines for a growing mid-market company to maintain, especially right now.
Why “We Need AI” Is Not a Strategy
The mid-market is drowning in technology options and starving for technology clarity. Every week brings a new platform, a new AI capability, a new vendor promising to transform operations, cut costs, and accelerate growth. And for companies operating between $50M and $300M, complex enough to feel the pain but not always resourced enough to navigate it well, the noise is deafening.
I understand why leaders fall into the instinct to act. If the tool is being talked about everywhere, maybe the company should be using it. If a competitor just implemented a new ERP, maybe the risk of falling behind is real. If the board is going to ask about AI at the next meeting, it feels better to have an answer.
But “we need AI” is not a strategy. Neither is “we need a new CRM” or “we need to modernize our tech stack.” These are technology statements masquerading as business decisions. And the dangerous thing about them is that they feel purposeful. They feel like forward motion, while actually skipping the step that determines whether any of it will work.
That step is answering a question that has to come before any technology conversation: what business problem are we actually trying to solve?
Here is a data point I come back to often. Most mid-market companies are utilizing somewhere between 10 and 15 percent of the capabilities in their existing technology platforms. They are not behind because they lack tools. They are behind because the tools they already own are not being used, adopted, or connected to business outcomes. Buying more software does not solve that problem. It compounds it.
Most companies I walk into are not under-tooled. They are under-utilized. The answer is almost never more software. It is making the software they already have actually work.
Start With the Business Problem, Not the Software Demo
The inversion I advocate for is not complicated in theory, but it requires a discipline that most organizations struggle to maintain under pressure. Before any vendor is contacted, before any demo is scheduled, before any RFP is written, I ask leadership teams to sit with a set of foundational questions.
What outcome are we actually trying to drive? Not “improve efficiency” or “scale operations,” but specific, measurable outcomes. Revenue growth from a particular segment. Reduction in order fulfillment time. Improved margin on a specific product line. Customer retention improvement in a particular channel. The more specific the outcome, the clearer the technology decision becomes.
What is actually slowing us down? This is where the most important honesty happens. Sometimes the answer is a technology constraint: a legacy system that cannot scale, a lack of data integration that forces manual reconciliation, a CRM that does not reflect how the company actually sells. But just as often, the constraint is a process problem, a people problem, or an organizational alignment problem that software cannot fix and will likely amplify.
What does success look like in 18 to 24 months? Major technology investments in the mid-market rarely produce meaningful returns in 90 days. Leaders who evaluate technology decisions on short timelines tend to abandon initiatives before the value materializes, and then repeat the cycle with the next vendor. Setting realistic horizons and identifying the leading indicators that signal progress is strategic work that has to happen before the purchase order.
Only after those questions have been answered, and the leadership team is genuinely aligned on the answers, should technology enter the conversation. At that point it enters as a potential vehicle for a defined business outcome. Not as the strategy itself.
The business strategy has to lead. Technology follows. When you flip that order, you end up with expensive shelfware and a team that does not understand why they are being asked to change how they work.
The Most Expensive Mistake I See Mid-Market Companies Make
If there is a single pattern I see more than any other, it is this: companies throw software at problems that software alone cannot solve.
A sales team that is not following a consistent process gets a new CRM. The CRM does not get adopted because the process problem was never addressed. The platform sits largely unused, leadership concludes the tool was the wrong choice, and the cycle begins again with a different vendor. The real issue, a lack of sales process definition and management discipline, was never touched.
An operations team struggling with inventory visibility invests in a new warehouse management system. The implementation drags on because the data going into the system is inconsistent and incomplete. The system goes live but produces unreliable outputs because nobody addressed the data quality problem that existed long before the purchase decision. The technology gets blamed. The underlying issue remains.
What I have learned from being inside these situations is that the technology decision is roughly 20 percent of whether an initiative works. The other 80 percent is change management, process redesign, data readiness, organizational alignment, and helping people make the transition.
That is not a comfortable message for leaders who want to move fast. But it is the message that saves companies from wasting millions of dollars and two to three years of organizational energy on initiatives that were set up to fail before the contract was signed.
You can buy the best software in the world and still fail completely. The technology is rarely why these projects go sideways. It is everything that has to happen around the technology that most companies underinvest in.
What Intentional Technology Leadership Actually Looks Like
The companies I have worked with that consistently turn technology investment into business results share a set of characteristics that have very little to do with which platforms they have chosen.
They treat technology as a capability-building exercise, not a tool-buying exercise. The question is not “what software should we buy?” It is “what capability do we need to build, and what combination of people, process, and technology will get us there?” That framing changes everything about how decisions get made, how implementations get resourced, and how success gets measured.
They assess their current state honestly before looking outward. Before evaluating any new solution, they invest time in understanding what they actually have: what is working, what is not, and why. That assessment often reveals that the highest-ROI move is optimizing current capabilities rather than acquiring new ones. I have walked into engagements where the most valuable thing I did in the first 60 days was help a company get more out of tools they were already paying for.
They measure technology success by business outcomes, not go-lives. A successful implementation is not the day the system goes live. It is six months later, when adoption is where it needs to be and the business metrics the initiative was designed to move are actually moving. Companies that treat go-lives as the finish line tend to lose momentum precisely when the hard work is beginning.
And critically, they have someone who can sit at the business strategy table and translate. Not just someone who manages IT operations, but someone who can connect technology decisions to revenue, margin, customer experience, and competitive positioning. In many mid-market companies, that person does not yet exist internally. That is a gap worth taking seriously.
Why More Mid-Market Companies Are Turning to Interim Technology Leadership
Here is the reality for a lot of companies operating between $80M and $300M. They are large enough that technology decisions carry serious consequences, but not always large enough to justify a full-time CIO who can operate at the intersection of business strategy and technology execution. The result is often a VP of IT who is excellent at keeping the lights on but is not positioned to drive the strategic technology conversation at the leadership level.
This is exactly the gap I step into. When I come into a mid-market company in an interim capacity, the engagement is not about managing IT infrastructure. It is about helping leadership answer the questions that have to precede technology decisions and then ensuring that the investments the company makes are anchored to outcomes that actually matter.
Sometimes that means building the technology roadmap from scratch. Sometimes it means stopping initiatives that are consuming resources without a clear line of sight to business value. Sometimes it means renegotiating vendor contracts that no longer reflect the company’s size or needs. And sometimes the most important thing I do is help the leadership team align around a shared understanding of what they are actually trying to accomplish before technology enters the room.
For private equity-backed companies and businesses navigating ownership transitions, this work is particularly valuable. Technology is often both a source of value creation and a source of undisclosed risk. Understanding which is which, and building a roadmap that addresses both, requires the kind of pattern recognition that comes from having been inside dozens of companies at similar inflection points.
The Leaders Who Will Win the Next Five Years
The pace of change is not slowing down. AI capabilities are evolving faster than most organizations can evaluate, let alone adopt. New platforms are launching every month. The pressure to act will only intensify.
In that environment, I am convinced that the companies that win will not be the ones that move the fastest toward every new tool. They will be the ones that move with the most intention, always asking first what the business needs, and then deciding what role technology should play in getting there.
That requires building a culture where technology is respected as an accelerant, not treated as a solution. It requires leadership teams that are willing to do the harder work of defining outcomes before opening the vendor catalog. And it requires having the right people in the room when those decisions are being made.
The leaders who will win the next five years are not the ones who adopted AI first. They are the ones who adopted it with a purpose, connected to a real business outcome, with a plan to actually make it work.
Hear the Full Conversation
I go deeper on all of these themes in Episode 2 of Middle Market Smart, the CXO Partners podcast on growth, technology, and leadership for mid-market companies. We get into real-world examples of companies scaling from $80M to $250M+, the mistakes that derail technology initiatives at every stage, and the practical framework I use to stay focused when the innovation noise keeps getting louder.
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About Tracy Deuell
Tracy Deuell is Managing Partner of Technology Strategy Services at CXO Partners, a national firm specializing in interim executive leadership, strategic advisory, and transformation for mid-market companies. With decades of experience as an interim CIO and technology transformation leader across healthcare, financial services, distribution, manufacturing, and nonprofits, Tracy has helped companies scale from $80M to $250M+ by connecting technology decisions to the business outcomes that actually drive growth. He serves on the Middle Market Smart podcast as a featured voice on practical technology strategy for growth-stage companies.
Connect: cxo.partners/team/tracy-deuell · linkedin.com/in/tracydeuell
About CXO Partners
CXO Partners is a national executive advisory and interim leadership firm helping mid-market companies navigate transformation, leadership transitions, and growth. With deep expertise across Finance, Technology, Operations, and Supply Chain, CXO Partners provides the experienced leadership that growing companies need, when and how they need it. Headquartered in Atlanta, GA, with clients across the United States.
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