Chief technology officers · the role
What does a CTO do?
The short answer · updated
A chief technology officer (CTO) sets an organisation’s technical direction: which technologies it uses, how its systems are built, and how the engineering team works. In a company that sells software, the CTO leads the building of the product. The CTO turns the business strategy into a technology plan and answers for its security and reliability.
What a CTO does
The government’s Digital and Data Capability Framework calls the CTO the organisation’s technology strategist: the person who makes decisions about its technical direction and works closely with the other senior leaders. It lists the job as below, and adds that a specific CTO job varies with the organisation.
In a start-up the CTO may still write code, choose the stack and hire the first engineers. In a scale-up the job shifts to building an engineering organisation, setting standards and architecture, and deciding what to build versus buy. In a large company the CTO sets direction across many teams and spends more time with the board, investors and customers.
- creating a technology strategy that fits the organisation’s wider strategy, and leading its delivery;
- evaluating the technologies the organisation has and the ones it needs;
- putting in place a reliable technology architecture;
- keeping systems and services running and resistant to attacks and disasters;
- helping the organisation adopt new technologies that offer value, within appropriate levels of risk;
- making sure people have the tools, technical skills and ways of working to deliver.
Security, data protection and R&D
A CTO who ships software owns how securely it is built. The government’s Software Security Code of Practice, written with the NCSC, sets out principles for software vendors to reduce the likelihood and impact of supply-chain attacks and other resilience incidents. The NCSC’s Cyber Security Toolkit for Boards covers how the board oversees that risk.
The product also has to handle personal data lawfully. The ICO’s guidance on data protection by design and by default says data protection must be built into systems from the design stage and throughout their lifecycle, with extra duties for online services likely to be used by children. That is an engineering decision as much as a legal one.
Many CTOs also carry the technical case for R&D tax relief. HMRC requires a project to seek an advance in science or technology by resolving a technological uncertainty, and the company has to explain the work done to overcome it. The CTO is usually the person who can.
Who a CTO reports to
A CTO usually reports to the chief executive. In a venture-backed company the CTO is often a co-founder, sits on the board or attends it, and presents the technology plan to investors.
Where the company has a chief product officer, the two work as a pair: product decides what to build and why, the CTO decides how and runs the team that builds it. In some larger groups the CTO reports to a chief operating officer or a group CIO.
A CTO who is a company director has the seven general duties under the Companies Act 2006. Companies House guidance says the duties apply even to someone who acts as a director without being formally appointed, which matters for a founding CTO who has never been put on the register.
CTO vs CIO
The CTO looks outward, at the product. The CTO sets the technical direction of what the organisation builds and sells. The CIO looks inward, at the business. The CIO runs the systems, data and IT suppliers the organisation itself uses. The government framework describes the chief digital and information officer as keeping the organisation’s digital, data and technology resilient and advising the board on all of it (DDaT framework).
Many organisations have only one. A software company often has a CTO and no CIO, with a head of IT under the chief operating officer. A retailer, charity or professional firm more often has a CIO or IT director and no CTO. Where both exist, they split the estate: the CTO takes the product platform, the CIO the corporate systems.
Other titles sit close by. A VP or head of engineering manages the engineering team day to day, often under a CTO. A chief information security officer leads security. For the inward-facing role, see fractional CIO roles.
Fractional, interim and part-time CTOs vs a permanent CTO
A permanent CTO is an employee, often with equity, who owns the technology for the long run. That suits a company whose product and engineering team need full-time leadership.
A fractional or part-time CTO works a set number of days a week or month. That suits an early company choosing its architecture and first hires, a non-technical founder who needs a technical counterpart, or a business preparing for due diligence. You can hire a fractional CTO or hire a part-time CTO. An interim CTO works full-time for a fixed period, to cover a departure, steady a team or lead a rebuild; you can hire an interim CTO.
A fractional or interim CTO often works through their own company, so the off-payroll working rules (IR35) may apply. Status turns on how the engagement runs in practice, and a medium or large client makes the determination. Our IR35 guide sets out the tests.
What a CTO costs and earns
Pay moves with the company’s stage, funding and sector, the size of the engineering team, and how much equity is on offer. A permanent CTO is paid a salary, often with equity or a bonus; a fractional or interim CTO a day rate.
We do not publish a figure on this page. Our CTO salary page sets out permanent and fractional pay, and our fractional CTO cost page sets out day rates and costs by company stage. Each figure there carries its source.
How to hire a CTO
Decide what the CTO has to do in the next two years: choose an architecture, build a team, fix a platform, or prepare for a raise or a sale. A builder, a scaler and a turnaround CTO are different people. That also tells you whether you need a permanent, fractional or interim CTO.
Test the work. Ask candidates to walk through a system they designed, a team they built and a failure they owned, and give a short practical exercise based on your own product. SFIA’s levels of responsibility describe the top level as setting strategy and taking accountability for overall success, a useful yardstick. BCS Chartered IT Professional (CITP) registration is a signal of competence and conduct, though not a requirement.
Our CTO headhunter page sets out how we hire a CTO. We recruit fractional, interim, part-time, temporary and permanent executives. Every brief gets a shortlist of 3–5, each with pay or day rate, availability and IR35 position set out, after the five-stage vetting we describe.
Questions people ask
What is the difference between a CTO and a CIO?
The CTO sets the technical direction of what the organisation builds and sells, and usually runs engineering. The CIO runs the technology the organisation uses internally: systems, data, infrastructure and IT suppliers. Many organisations have one or the other; larger ones may have both.
Does a CTO still write code?
Sometimes. In an early start-up the CTO often writes code and reviews every change. As the team grows the CTO spends more time on architecture, hiring, standards and the board, and less on code. A CTO who cannot let go of the code can become the bottleneck.
Does a start-up need a CTO?
A start-up whose product is software needs someone accountable for its technology from the start. That may be a technical co-founder, or a fractional CTO for a few days a month who sets the architecture, hires the first engineers and supports a non-technical founder.
What is the difference between a CTO and a VP of engineering?
The CTO sets the technical direction and represents technology to the board and investors. A VP or head of engineering runs the engineering team day to day: delivery, process and people. In a smaller company one person does both.
Is a CTO a director?
Not always. A CTO is a company director only if appointed to the board, though a founding CTO often is. Companies House guidance says the directors’ duties also apply to anyone who acts as a director without formal appointment.
How much does it cost to hire a CTO?
It depends on the engagement. A permanent CTO is paid a salary, often with equity; a fractional or interim CTO a day rate. Our CTO salary and fractional CTO cost pages set out sourced figures. We set out pay or day rate for every candidate on a shortlist.
How do I hire a CTO?
Define what the CTO must achieve, choose between permanent, fractional and interim, and test candidates on systems and teams they have built. Our CTO headhunter page sets out the process; we send a shortlist of 3–5, each with pay or day rate, availability and IR35 position set out.
