CIOs play multifaceted role, but still don't get a seat at the top table

While CIOs prefer to spend more time on innovation projects, most CIOs must spend their time battling to achieve the reduction of cost in IT delivery, according to Constellation Research. The research firm surveyed CIOs since 2010 asking about their priorities across four personas of the CIO role. These personas include the Chief Infrastructure Officer, Chief Integration Officer, Chief Intelligence Officer, and Chief Innovation Officer.

In the recent CIO survey of 119 respondents, over 44 percent expressed that reducing the cost of IT delivery remained the number one priority. However, when asked what should be the number one priority, almost 44 percent expressed that bringing innovation to the business was the number one requirement.
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“Hence, CIOs have known what they need to do. Yet, the sheer burden of reducing IT costs creates a conundrum as organisations move on in technology investments. Despite the presence of line-of-business leadership, CIOs are often consulted,” the research firm said.

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Constellation, however, believes three key factors prevent CIOs from bringing innovation to the business. More than 44 percent of CIOs report to someone other than a CEO, President or COO. The lack of a seat at the top management table hinders CIOs from serving in the persona of chief innovation officer. Companies that have a CIO report to the CEO often are more innovative organisations that value the impact that technology plays in enabling business innovation.

The survey shows that 70-80 percent of all IT budgets are focused on legacy and infrastructure projects. Until CIOs can reduce their IT spend, the CIO must continue to play the persona of chief infrastructure officer. Meanwhile, the persona of the chief integration officer continues to play a greater role as systems must be connected to external networks, customers, partners and suppliers.

Most line-of-business executives intend to increase spending by 20-25 percent on technology-related projects in 2014. Line-of-business technology investments are gaining importance due to cloud, mobility and Big Data project requests. Shadow CIOs, or people who lead technology projects on the business side, continue to exist and carry out the chief intelligence officer and chief innovation officer personas. This is why tech spending is up, yet IT department spending is mostly down.

The cloud - at the level of Infrastructure as a Service (IaaS) or Platform as a Service (PaaS) - once again earned the top spot, with 63 percent of respondents selecting this category as their top choice when asked what their top three priorities were. Renegotiating contracts (37.8 percent) came in a distant second. Meanwhile, virtualisation (35.3 percent) has dropped to third as many organisations have already adopted it and enjoyed many savings. Optimising the data centre (30.3 percent) remains a key strategy in reducing big-ticket expenditures. Of note, third party maintenance (27.7 percent) made a significant leap as a strategy to reduce legacy enterprise software costs.

In the integration role, executives must connect internal systems with customers, partners, suppliers, new employees and other external data sources. Integration officers must also prepare for a world of massively connected systems and Big Data business models from sensor analytical ecosystems. Many companies now have to integrate content from social media and content management systems into their software. Consequently, integration officers focus on management of APIs, mobile end points, compliance activities and integration libraries (54.6 percent). Ensuring master data management as a category drops to second place (51.3 percent) while identifying systems for retirement jumps (42.9 percent) to third in terms of key priorities. SOA principles (40.3 percent), maintaining process integrity (35.3 percent), establishing an architectural review (27.7 percent) and dealing with upgrades (27.7 percent) rounded out the list. In the future, integration will include sensor and analytic ecosystems in a world that encompasses the Internet of Things (IOT).

The intelligence role brings the right information to the right person at the right time with the right security model and the right form factor. The role increasingly is driven from the line of business or CFO office. As mobile technology, Bring Your Own Device (BYOD), Consumerisation of IT (CoIT), exponential growth of data and the proliferation of devices continue to make strides, form factor returns as the number one priority among intelligence officers. Enabling mobile access shoots to the top (59.7 percent). The shift to mobile first is more than a mantra. Self-service access (42.9 percent) is the third on the list. Meanwhile, data quality comes in second at (47.9 percent) as intelligence officers continue to worry about false positives in data while new information sources and Big Data create constant threats to data integrity. Today, chief intelligence officers have to deal with managing data, delivery of data and diagnosis.

Chief innovation officers often have two key characteristics - deep knowledge and passion for the business domain and the ability to simplify the communication of technology and its impact on business. Mobilising the enterprise (54.6 percent) leads their top priorities for 2014. With technology skills key to innovation success, training IT leaders to address business (46.2 percent) is the number two priority for the innovation officers. Cloud (40.3 percent), a perennial favorite and enabler, is the third priority as the innovation role seeks rapid deployment without the dependencies on IT. Meanwhile, innovation centres (34.5 percent) remain popular and business and IT collaboration (27.7 percent) rounds out the top five.

However, Constellation claims organisational DNA plays a significant role in shaping how the CIO succeeds. “While there are different layers of DNA within an organisation, the overall DNA does drive the desire and proclivity for digital disruption. Savvy CIOs will know how to maneuver around these layers to drive innovation. The CIO has a role in enabling innovation across the organisation. More importantly, the CIO should not stifle innovation but enable and accelerate it. The CIO should also make sure that fast innovation becomes a success and not a money sinkhole.”

Important pillars of digital disruption begin with social, mobile, cloud, Big Data analytics and unified communications. The convergence of these pillars provides the key to future innovations. In fact, the wish list among CIOs includes many of these pillars. In addition, augmented reality and Internet of Things made big jumps in priority.

“These technology shifts present opportunities to create new business models and are also the same opportunities that disrupt existing systems and transform organisations,” according to the report.