2,500 CIOs Speak Out

 
 
By Dennis McCafferty  |  Posted 2009-12-08
 
 
 

Wanted: CIOs to manage today’s corporate enterprises. Skills needed include a vast command of all developing IT trends, from virtualization to convergence to Web 2.0. People skills count greatly as well. In other words, loners need not apply.

At least, that’s the message presented in an exhaustive new report, “The New Voice of the CIO: Insights from the Global Chief Information Officer Study,” developed by the IBM Institute for Business Value. Within the highest-performing companies, more than six of 10 CIOs seek to integrate business with technology, the study reports, while only one-third of CIOs at low-performing companies do the same.

Also, at the higher-performing companies, CIOs say they spend 64 percent of their time attempting to drive innovation and growth, as opposed to traditional tasks, such as infrastructure and operations management. The upshot: CIOs are seeking to weave IT innovations into the “big picture” of business needs in their enterprises. And successful CIOs constantly seek insight from employees at all levels of the organization.

How involved do they get? In the case of one study participant, Avon CIO Donagh Herlihy, it means getting out there with the sales teams to find out what customers want.

“Shortly after he started, he spent a week or so out selling lipstick,” says Peter Korsten, who oversaw the study as global leader for the institute, IBM’s primary business-focused think tank. “He learned that customers were making great use of social networking tools. So he went back to the Avon board members and sold them on the idea of launching Web 2.0 applications, such as social sites, blogs and wikis. No one had even thought of the idea before—for a cosmetics company to be getting involved with these things.”

Such an effort appears to be a sign of success: In the next five years, 87 percent of CIOs at high-growth companies plan to seek customers’ active input and interaction, compared with only 70 percent of CIOs at low-growth companies.

To conduct the study, researchers met face to face with more than 2,500 CIOs in 78 nations representing 19 industry segments. They asked participants about their philosophical approaches to their jobs, as well as the kinds of technologies they’re most interested in. Here are some of the key findings:

It’s all in the data. Customer information, sales patterns, patient records, social-network “fan” pages, equipment breakdown cycles, user clicking patterns—all kinds of data representing important corporate assets. That’s why 83 percent of survey respondents pinpointed business intelligence and analytics systems as ways to make their organizations more competitive.

“We talk a lot about ROI,” Korsten says, “but I had a CIO tell us that it’s really about ROY—return on yesterday. He explained that he didn’t have the budget to invest in new stuff, so he needed to make better use of what he already had.”

Green is good. CIOs want to keep lowering energy costs, with 76 percent undergoing or planning virtualization projects to help achieve that. It wasn’t too long ago that “going green” sounded somewhat utopian and even naive in corporate circles. No longer, as more companies have concluded that IT systems are among the biggest consumers of power resources.

“Going green for the sake of going green usually isn’t an option,” says Korsten. “But if you can go green and clearly demonstrate savings, it’s a fantastic solution.”

Outside help is welcome. At high-growth companies, 56 percent say they use third-party business or IT services, but only 46 percent at low-growth companies say they do. “The high-growth company CIOs are making an explicit choice here,” Korsten says. “They do not feel like they have to do everything. They focus on what they’re good at and then seek outside expertise for other needs.”

Getting in sync is essential. More than three-quarters of CIOs seek to have a stronger, more centralized infrastructure within five years, and more than half expect to launch completely standardized, low-cost business processes.

“There’s a lot of duplication of data that these CIOs are trying to avoid,” Korsten says. “There’s too much expensive infrastructure where various key applications are incompatible. CIOs don’t want to run a company in which employees aren’t easily able to share the data and the applications aren’t in harmony. Service-oriented architecture systems that provide interoperability save money and increase productivity.”