The IT department has notoriously been known for responding to requests rather than having a strategy in place which dictates what they work on. However, with an ever changing business environment and the business’ understanding of how important IT can be in meeting the company’s overall strategy from a technology standpoint, this is all changing.
The Economist conducted a study of CIO’s from a variety of organizations to gain further insight into the current risks, opportunities and outcomes that they were experiencing. One particular area of interest was the concept of CIOs having an expanding role in the business.
These CIOs felt that they needed to have a greater role in being more strategic, which was exemplified by Patty Morrison, CIO of healthcare services company Cardinal Health who said “All the senior executives of a company have to play a role in driving strategy based on where they are adding value in the market.”
Despite this greater sense of accountability, many of these CIOs felt that they still weren’t being engaged in the early planning stages of setting the strategy. Only about half of survey respondents indicated that they are an early-stage stakeholder in—and adviser to—all mission-critical projects with a technology component.
The majority of CIOs are consulted prior to project execution, but primarily in support roles. Also, 62% of CIOs polled say their companies view the role of technology within the business as “tactical, primarily to drive efficiencies and increase productivity.” This does little to help CIOs to be proactive in setting technology strategy and makes it difficult for them to create added value in this area of the market.
It was further observed that in the middle market, IT tends to be less strategic and more tactical. This may be a factor of size, but when looking at the competitive landscape it could prove to be a disadvantage. “Even mid-size companies find themselves at a disadvantage against competitors that embrace technology as more than just a way to cut costs or improve operations,” maintains Tim Theriault, CIO of drug retailing chain Walgreens.
CIOs also report that their C-suite colleagues are more tech-literate, making collaboration across business lines simpler than it previously was: 80% of CIOs say their business counterparts have “high” or “moderate” knowledge of technology trends; 90% say they themselves have a “high” or “moderate” level of technological literacy. This may explain why businesses haven’t necessarily adopted their CIOs as part of their early technology strategy discussions.
Additionally, it may because the role of a CIO is also expanding into other areas, rather than just their approach to the role. In some cases, CIOs are also responsible for human resources or customer service functions within the same organization. Mr. Theriault, for example, holds many titles: CIO, chief innovation officer, and chief continuous improvement officer. The CIO’s role is expanding to encompass a number of new business responsibilities.
With the expanding role, CIOs may have a greater influence across other business aspects, but what is key to their expanding role is taking a strategic approach. CIOs need to move away from tactical or simply responsive and move further towards a strategic approach to better help position the business in the competitive landscape. This is also where their priorities should lay.
Most CIO survey respondents consider developing a strategy to integrate emerging technologies into the enterprise either a “high priority” (31%) or a “moderate priority” (54%), CIOs interviewed for this report consider this an essential part of their responsibilities. Additionally, they are better positioned to do so. When asked to compare their current roles with the past, 49% of CIOs report that today they are “well positioned to promote game-changing innovations” within their companies while only 26% would have said the same three years ago.
We would love to hear your thoughts on this subject – Do you believe your CIO has a sufficient input in developing strategy around technology initiatives in your organization? Do you think it is important that they do?