Are CIOs being given the strategic role they deserve?

The business role of the CIO – focusing on transforming the organisation with technology that drives efficiency, opens up new markets, products and services – can be much more exciting than the traditional break/fix role. The CIO and the IT department underpin, and in some cases drive, this move.

Consequently, there is also the potential need to transform the IT department itself so it is capable of playing this more active, proactive and interactive role. Then, there is the transformation of CIOs themselves, in terms of focus, concerns and professional positioning. A leader is more useful to an organisation than a follower, and ultimately more employable.

The indications from the 2012 State of the CIO survey are that IT managers, and specifically CIOs, are exactly in that schizophrenic position – 61 per cent say that their focus is on long-term strategic thinking and planning; 46 per cent also choose improving IT operations/systems performance.

Barry Wiech, CIO for food manufacturer Parmalat, says the strategic side is top of mind for most CIOs at the moment but "we must not forget that we still have a core job to keep the lights on."

"We need operations to run smoothly to be taken seriously at the strategic table – it’s hard to have the strategic conversations if we can’t get the basics right. I think the [survey] assessment is fair in that most CIOs would love to sit more in a strategic space, but the reality is that day-to-day operations require attention, and until business realise the value that CIOs can add around the strategic table, this will not change significantly in the short term.”

Clive Bailey, head of IT with Dexus Property Group, agrees that it's not easy but it is essential that CIOs do both well.

"If you ignore your operational responsibilities then nothing you do or say at the strategic level will be trusted because the perception of your business colleagues is, ‘If you can’t keep [IT services running efficiently and properly] then why should we trust you to give us clear guidance for the future because we won’t trust you to deliver on that either?’

"Following on from that, if you’re not engaged with them strategically, then your value-add to them is severely diminished and you have just put yourself into the ‘cost centre’ basket.”

But there is always a technological fly in the business ointment. Michael Eggenhuizen, director of ICT at The Kings School Parramatta, suggests, “Perhaps one could debate ‘long-term strategic thinking’, as it is difficult to plan too far ahead as the ‘technology’ – the hardware, applications, processes, policies – changes rapidly.

Having said this, I produced a five-year IT projections document that caters for IT hardware and applications changes within the School over time. This document allows the school to plan for changes in strategic direction, infrastructure and budget.”

So can outsourcing provide the grunt power in the ‘lights on’ area to allow CIOs to be more strategic? A third of respondents to the survey estimated that in five years’ time, 20 per cent of their activities will be outsourced.

Eggenhuizen says whether IT support/activities are outsourced or in-house is dependent upon a number of factor and businesses often cycle through both modes as circumstances change. He adds that this applies to schools as much as commercial business.

“The cycling usually occurs as a result of a number of factors including: budgetary demands; failing infrastructure, processes and policies; lack of staff expertise; lack of vision and strategic planning; poor decision-making; lack of teamwork; complacency and so on.”

Bailey feels that outsourcing is becoming more effective as products and services are further commoditised.

"The true value of IT lies in our ability to work effectively with our business colleagues on their pain points and help them find appropriate solutions," he says. "I see no value in running my own data centre or WAN, there is no competitive advantage in that."

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CIO asked the most senior IT executives in many organisations, supporting an average of 4000 internal users, what their key priorities were over the next 12 months.

Perhaps one of the most encouraging findings from online surveys with these IT leaders is that only 23 per cent of respondents said the business viewed the IT organisation as a cost centre, down from 36 per cent in 2011.

Some of the key findings included:

More strategic thinking

• 61 per cent of their time is spent on strategic thinking and planning
• 46 per cent on improving IT operations and system performance
• 43 per cent on aligning IT initiatives with business goals
• 37 per cent on tapping expertise to run the IT function
• 35 per cent on change leadership.

Technology priorities

• 56 per cent said mobile technologies was their top technology priority
• 40 per cent said business intelligence and analytics
• 37 per cent said updating legacy systems
• 28 per cent said cloud: software-as-a-service
• 27 per cent said collaboration technologies.

IT management priorities

• 54 per cent said improving business processes was their top IT management priority
• 48 per cent said increasing IT capacity and resources to drive innovation
• 45 per cent said marketing the IT department so the business has a better understanding of IT's capabilities and processes
• 37 per cent said lowering IT's operational costs to free up money for new initiatives
• 30 per cent said increasing the scope of IT's centralised or shared services to improve efficiency.

Technology trends that matter to CIO

• 32 per cent said mobility mattered the most
• 30 per cent said cloud computing
• 15 per cent said big data
• 12 per cent said consumerisation
• 10 per cent said social media.

CIO's State of the CIO 2012 survey will be published soon.