Budget cuts make innovation a top CIO priority - report

Ability to deliver is a key stat for the modern IT leader

While firms are concerned about the global economy and continue to cut budgets, CIOs are responding by taking on more of a strategic role.

That conclusion comes from a survey of over 1,000 senior IT leaders by Logicalis, which found that 41% of CIOs now have some responsibility for business strategy. That finding reflects Gartner's 2021 CIO Role Evolution Primer, which found that 81% of CIOs now lead initiatives beyond traditional IT management.

In response to slashed budgets, CIOs are developing strategies that drive growth, improve efficiency and deliver the innovation customers, employees and partners demand. More than 80% of survey respondents said they are spending more time on innovation than they did last year; half are expected to deliver continuous innovation; and 46% said 'innovation' is now part of how their job performance is measured.

Eighty percent of respondents expect business strategy to become a bigger part of their role over the next two years.

CIOs' traditional mode of driving efficiency and growth - managing IT infrastructure to support business strategy - is no longer enough. In the modern era, business strategy is IT strategy, and vice versa.

James Watson, CIO at US-based Total Safety, said, "Increasingly CEOs are looking to their CIOs for strategic advice as to how to leverage technology to improve the value of the business and the service to the customer."

Top priorities

As well as the traditional role in managing technology strategy, senior IT leaders are increasingly focused on experience: both of customers and employees. Sometimes, they're the same thing.

Some 79% of CIOs expect to increase spending on customer experience in 2023, while 77% want to 'redefine' the customer experience in the year ahead.

In addition to that, more than half (57%) listed employee experience as a key priority. For the CIO, that means building a digital-first culture with high quality interactions and the ability to use data to deliver better leadership insights.

Dean Mills, director of information technology at Anglicare Victoria in Australia, said, "Technology only works when you work with your people, engaging key stakeholders, telling a story and creating a little bit of excitement around what's coming and how it's going to benefit their day-to-day work."

Despite budget cuts, that need to support user experiences is driving continued spending on digital transformation. Some 77% of companies say they will invest in 2023.

Green tech keeps growing

Sustainability comes out as another top priority for CIOs in 2023, with Nuno Pedras - Group CIO for Galp Energia in Portugal - saying, "Digitalisation goes hand in hand with sustainability."

CIOs often have a head start in sustainability initiatives, as they are often at the forefront of delivery: from self-service customer portals to remote working platforms.

They are also among the most likely people in an organisation to be working with climate data. About half (49%) of respondents said they look at carbon output, sustainability and energy efficiency when choosing new suppliers, and 20% say this is an important consideration when choosing new Managed Service Providers (MSPs).

Almost every respondent - 92% - said they see a clear link between ESG, sustainability and enterprise value, with customer attraction and retention among the top motivators for driving increased sustainability.

However, lack of skills, data and leadership buy-in hampers ESG efforts. Fewer than one in four IT professionals today say their organisation can accurately report on ESG performance.

This is expected to change in the future, but the CIO can be a key figure in driving and delivering that change now.

We have found the same lack of transparency and data in our own Tech Impact research. Expect a report on the sustainability of the top cloud providers - Microsoft, AWS and Google - to be released very soon.

The full report concludes that CIOs are trying to ride the wave of innovation, but the many demands on their attention make it seem as if they're "trying to conduct an orchestra at the same time."

Key questions for senior IT leaders to consider include:

• What actions can I take to fine tune innovation in our organisation?
• How can I work with colleagues across the organisation to build stakeholder engagement?
• What are the most significant risks to our organisation, and how can we build resilience to mitigate those risks?
• How well do we pitch to employees and customers, and how can technology improve the user experience?
• What steps can I take to build understanding, awareness and measurable action around sustainability that reaches outside the IT organisation?
• How can I rethink the way our organisation engages with service providers to meet modern challenges?

We will discuss many of these issues in our free virtual event, Deskflix: Hybrid and Multicloud, next week. Click here to register.