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CIOs need to embrace change to drive business innovation

Johannesburg, 20 November 2013 - The findings of the Deloitte CIO Survey for 2013, a global survey that gathered responses from more than 700 CIOs and senior IT leaders across 36 countries, suggest that while the worst of the IT budget cuts are behind us the business environment is still extremely challenging for CIOs.

This is characterised by increasing business expectations, rapid increases in the pace of business and technological change, shrinking technology adoption lifecycles, and a shortage of available talent. The role of the CIO as a trusted partner to the business, in what for many parts of the world remain difficult economic times, has never been more important or challenging.

While the Survey showed consistent experiences across global regions and industries, some variations have come to the fore.

"There are definitely some broad-sweeping challenges that CIOs in Africa are exposed to that their international colleagues are not. These would include things such as the cost and availability of connectivity, infrastructure investment costs, and access to skilled resources who are able to deliver business as well as technical insight," says Kamal Ramsingh, Technology leader for Africa at professional services firm Deloitte.

Despite this, business investment in IT is on the rise as nearly 80% of IT budgets have increased or stayed the same this year. The additional resource is focused on delivering against new business requirements, including new or revised business models and transformational plans, such as digital.

"The CIO is becoming more of a post-digital catalyst and this is a trend which we are seeing across South Africa. CIOs are having to embrace and adapt to fast-changing business needs which are being largely driven by the consumerisation and democratisation of IT," says Ramsingh.

He believes that this means that while CIOs may not be seen as the primary business innovators, they can choose to be at the forefront of supporting and enabling business innovation.

"This is definitely in line with the international trend. The only difference is that the readiness to adopt these new trends may not be as highly developed," says Ramsingh.

At a time when business transformation is a top priority for organisations, it is positive that the majority (75%) of CIOs understand how IT functions could support the innovation strategies of their organisations. This increased focus on digital and new business requirements places a greater demand on the IT department to be a centre of innovation. However, challenges remain as only 35% of respondents believe their IT function is considered a credible hub of innovation by the business.

"From a South African point of view, CIOs are going to be driven by a need to better deliver customer information back into the business. That means embracing the ideas of Big Data, social business, and customer analytics whilst still being able to deliver top tier 'business as usual' IT services," adds Ramsingh.

In short, he feels that CIOs could well be driving the digital strategy through the support of new business needs in addition to the consolidation and maintenance of current IT Infrastructure.

Key findings include:

  • IT and budget priorities: IT budget cuts largely seem to be behind us, as the majority (78%) of budgets have increased or stayed the same since last year. Almost half (42%) of budgets are being put towards change or growth activities. Business as usual still receive the majority (58%) of IT budgets.

  • Business partnering: Over half of all respondents acknowledge there is still more to be done to improve the IT function’s effectiveness in facilitating business change and growth. More than 60% rate their business partnering effectiveness as merely “fair” or “poor” and business partnering now sits at the top of the priority list. Furthermore, almost half (45%) believe their data and insight capabilities within the IT function need improving.

  • Innovation: Many respondents struggle to change business perceptions of IT as a mere provider of routine IT services and educate business leaders on where it can add real value. For example, 75% of the IT leaders in our survey feel there are significant opportunities for IT to support business innovation, yet only a third (35%) believe their IT function is considered a plausible centre for innovative development within their organisation.

  • Talent: The above disconnect between the business and IT is due in part to a shortage of the right skills within the IT function. Almost 60% of CIOs indicated that they are experiencing problems recruiting staff – in particular those that can think like the business, think strategically and communicate effectively.

  • CIO careers: Almost 40% of IT leaders are considering a CEO or COO role as their next career move, with a third (33%) not believing their current role provides them with development and job opportunities for a fulfilling career in IT. These leaders are eager to make a more strategic impact on their organisations and will look externally for roles that offer this opportunity. The main reasons for moving roles are a greater contribution to the business (27%) or a new challenge (26%).

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