The CIO Shift in Business

By Stephanie Blanchard, Digital Editor — November 11, 2013

If online chatter was any indication, the CIO as we know it is a thing of the past. Is the death of this position greatly exaggerated? Yes. The Society for Information Management (SIM), a nationwide organization of almost 5,000 members, has released data from its annual IT Trends survey. Results clearly indicate that CIOs are integral to the business in 2013 and beyond. Unfortunately, there is still a huge communication gap going on in the C-Suite.

Developed via the Delphi method (a three-round approach to formulating questions by experts) the trends survey followed a logic path, offering dozens of variables to carefully crafted questions. Purposely taking only a dozen minutes to complete, the survey yields long-ranging insights into the CIO’s year ahead.

Notably, 65% of respondents expect the IT budget to increase in 2014, with more than half of resources allocated to staff and outside contractors. Conversely, 27% plan on cutting IT budgets, and 23% plan on reducing IT employment.

Mobile Enterprise spoke with Leon Kappelman, University of North Texas, regarding the results which breaks it down by what keeps a CIO up at night, what the enterprise is worried about, and the areas that the company is actually investing in. While security is on the minds of many (coming in as the second most important issue to IT Leaders), it’s actually not on the minds of enterprises – not even making the top five concerns for organizations and coming in 14th place for investments.

The five largest IT investments in 2013:

  1. Analytics/ Business Intelligence
  2. Customer Relationship Management
  3. Cloud Computing
  4. Enterprise Resource Planning
  5. Big Data
Surprisingly, or not, apps come in at No. 6, as it did the year before. “Mobile is a piece of the overall picture but the term itself is going to become outdated,” Kappelman said. “To be an organization, you better be mobile, or you’ll become something we will remember in history.”

Answers Lead to Questions
Previous SIM surveys have painted accurate snapshots of the current technological landscape. This year the organization has decided to analyze the data in more depth and see where the insight leads. BYOD, for example, was actually a bigger investment in 2012, ranking No. 7. One year later, and it drops to No. 21. What’s going on?

“Sixteen percent are saying BYOD is keeping them up at night but many fewer are saying it’s a big investment. If 16% are telling me that BYOD is a big worry, a top five concern, do they represent more mobile enterprises? Or are there other differences we should be looking at?” Kappelman asked.

The number one concern — affecting both enterprises and IT leaders alike — is not security, or legacy systems, or mobile initiatives, but aligning IT with business. If a CIO can get this right, he or she is on his way to superstardom, at least within that person’s corporate world.

So is it better for the enterprise to promote the most technologically apt employee to the job, or the person who best understands the business? Perhaps the results can answer this question.

A Day in the Life
There is a big shift in how CIOs are spending, or trying to spend their time: from becoming just a tech expert to one who is much more business savvy — no matter what industry they are in. Thirty-seven percent of respondents are focused on the business, 36% are working on strategy, both up from 2012.

CIOs, however, have traditionally been held in low regard by CEOs and CFOs, in terms of contributions, and Kappelman is personally appalled. “If 85% of CEOs think the CIOs do not contribute to the business, my question is, why would you stand for that? Would you continue to hit yourself on the head with a hammer if it hurts the first time?”

In addition, while the role of CIO comes in 10th for most important issues to IT Leaders, the enterprise does not believe it’s worth worrying about: The issue ranks No. 23.

The reason there might be such disconnect is because enterprises aren’t paying CIOs to be key players, Kappelman explained. Want to change that, he added?  Change how you are measuring performance. In addition to focusing on whether projects come in on time or on budget, look at how IT can increase customer/client satisfaction, add to revenue growth  and improve decision making across the board. And don’t forget how incentives often correlate to initiatives in the first place.

However, if the organization really doesn’t want IT concentrating on anything but the technology, that’s okay too, Kappelman said, because ultimately, it’s what works for each particular company. But some businesses are making the long play. “It’s not just getting the technology up and running but setting the organization up for the second and third and fourth derivative payoffs,” he said. “It’s not about installing the hardware and software anymore but how to leverage it.”

And as a result, CIOs who come out of marketing can still be best of breed, making data work better for the enterprise, marketing what IT accomplishes, and helping improve performance and meeting strategic objectives. However, in 2013, only 9% of CIOs are coming from outside IT.

In Conclusion
Kappelman, a longtime SIM survey designer and accomplished research scientist, has come to appreciate how much more complicated it is to be an IT leader in 2013 than just a decade ago. Maybe other positions are equally hard, he said, but to be a good IT leader, a good CIO, in today’s environment, involves complex and multi-layered thinking.

“We actually forget how new IT is,” he said. The current crop of board members did not grow up with the exponential security risks for example, and before anyone even knew what a Microsoft desktop was, IT infrastructure involved a typewriter and a telephone.

Fast forward to the last five years, and technology, along with the business, has rapidly changed. Sometimes one is ahead of the other, and that’s where the problem stems. However, Kappelman does not believe the term “alignment” is an appropriate description, nor does it capture the full spectrum of what IT leaders have to deal with.

“IT is NOT separate,” he said. “The term ‘alignment’ is an historical artifact, and divisive, creating an us versus them thing. Business people say IT doesn’t know anything about the business and IT thinks no one understands the technology. It’s time for a paradigm shift.”

Kappelman, along with SIM chapters nationwide, plans on pushing the ball on that matter; it’s a question of deciding on the right things to say. In any event, the CIO is most definitely alive and viable.

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