CIOs walk a fine line between innovation and operational excellence. The study “State of the CIO 2022” shows where you set priorities. […]
If there’s one thing Jamie Holcombe has learned in his decades-long career as an IT executive, it’s to be a good salesman. Focusing on business value and communicating in a language that everyone understands is central to successful IT initiatives, whether it’s a project with state-of-the-art technology such as Robotic Process Automation (RPA) or a project such as the modernization of a data center. After a period of accelerated innovation triggered by the Covid-19 pandemic, Holcombe, CIO of the US Patent and Trademark Office (USPTO), is now using his sales skills to drive a new IT agenda. This focuses on fundamental IT topics, including optimization, security and the resilience of the entire company.
Like so many companies that have gone through a two-year cycle of large digitization projects, the USPTO is also in a kind of recalibration mode. Innovations to support remote work and to improve customer, supplier and employee loyalty will continue to be driven forward. But the authority has moved into a governance cycle in almost all sectors to ensure that the many digital initiatives from the pandemic phase are now optimized and actually bring added value to the organization.
The return to basic IT topics is reflected in the study “State of the CIO 2022”, for which 985 IT executives and 250 business managers were interviewed. 85 Percent of the participating IT executives devoted their time to transformative tasks, including modernizing infrastructure and applications, aligning IT initiatives with business goals, and strengthening the partnership between IT and business. Functional tasks also occupy a large part of the CIO agenda. Among the most important are security management, improving IT operations and system performance, as well as cost control and expense management.
The top priorities that CEOs see for IT executives show a growing desire to balance years of technology investment with operational excellence. At the same time, they must ensure that digital initiatives are pursued at full speed and deliver the desired business results. For example, improving IT and data security to reduce corporate risk was the most important requirement for CIOs for a third of the survey participants. The demand to strengthen cooperation between IT and specialist departments was also at the top of the list. In comparison, the digital transformation of the company was one of the three most important CEO goals for only 28 percent of respondents on the “State of the CIO 2022”. In last year’s survey, this figure was still 42 percent, in 2020 it was 39 percent.
Such typical fluctuations mean that IT managers are grappling with the question of how to find the right balance between business innovation and operational excellence – an important topic for three quarters of the participants in this year’s survey. It has always been a challenge to find the right balance, but last year the need to pursue the two business goals in parallel was particularly striking.
“As always, it’s about doing both,” comments Bess Healy, senior vice president and CIO at financial services provider Synchrony in Stamford, Connecticut. “The IT fundamentals are important, but this must not come at the expense of innovation. We must not lose sight of the ball or miss the chance to take advantage of the momentum we have gained with our digital-first experiences.“
Of the CIOs surveyed in 2022, 46 percent are trying to increase operational efficiency; last year, it was only 34 percent. The transformation of existing business processes, including automation and integration, was at the top of the agenda for 41 percent. But also the improvement of the customer experience was mentioned by 42 percent. The topic of employee productivity has a particularly high priority for 27 percent.
By far the most important area with regard to ongoing IT investments was cyber security – no real surprise, considering that the CEO has the task of minimizing threats to the company, while ransomware attacks and data breaches are increasing at the same time. Almost half of the respondents described the improvement of cyber security as the most important initiative that drives IT investments – a significant increase compared to 34 percent in 2021. Security and risk management is also the most frequently mentioned technology initiative that requires IT investments this year. And as part of the technology roadmap for hybrid working, almost half of the survey participants cited more effective cybersecurity as a particularly important prerequisite.
The standing of CIOs in their companies is likely to remain high after the pandemic, as the “State of the CIO 2022” study also shows. Almost three quarters of the CIOs surveyed are confident that the increased visibility of the CIO role triggered by their pandemic initiatives will remain.
The line-of-business managers (LOBs) surveyed, who often have a different view of the CIO role, are also convinced of this: more than three quarters assume that the special status of CIOs will endure regardless of cyclical shifts. In addition, CIOs are increasingly seen as “changemakers” who take the lead in business and technology initiatives – a view shared by the vast majority of CIOs surveyed (84 percent) and also by LOBs (75 percent).
The current study also confirms the leading role of CIOs in the definition and implementation of digital innovations. 86 Percent of CIOs say that their role is more focused on digitization and innovation, a slight decrease from 92 percent last year. In addition, 85 percent report that they are more involved in the management of digital transformation initiatives compared to their colleagues from the departments. In 2021, the figure was still at 89 percent.
According to this year’s survey, IT managers have found a recipe for success in order to build trust with colleagues in the specialist departments and to promote user engagement. More than half of the IT managers surveyed classified the CIO as a strategic consultant who proactively identifies business opportunities and makes recommendations, while only 26 percent consider the CIO as a consultant who gives advice and assistance in technology selection. Only 10 percent of respondents turn to the CIO solely for the purpose of risk assessment.
Even though this year’s focus is on the basics, LOBs’ view of IT management is now more in line with the CIOs’ own view of their role and tasks. The majority of companies that participated in the “State of the CIO 2022” survey see the top IT executive as a strategic consultant who proactively helps them identify business needs, make technology recommendations, and help select vendors. 21 Percent see IT as a kind of consulting resource. Three quarters of the participants describe CIOs as changemakers – an important confirmation of their leadership qualities – and 78 percent believe that the role of the CIO, which was upgraded during the pandemic, will continue to be in the foreground in the future.
Even when it comes to the impact on digital transformation, respondents were more willing to acknowledge the importance of the CIO this year. 79 Percent of those interviewed from specialist departments see the role of the CIO as more digital and innovation-oriented; 78 percent believe that the CIO plays an outstanding role in driving digital transformation. In comparison, in the “State of the CIO 2021” survey, only 62 percent of the respondents rated the role of the CIO as particularly digital and innovative. And only 59 percent thought that CIOs have a greater share of digital transformation compared to other executives.