The Gartner 2011 CIO Survey reveals that almost half of all CIOs expect to operate their applications and infrastructures via cloud technologies within the next five years.
This change will necessitate that CIOs re-imagine IT and lead their organizations through a process of creative destruction. Eric Goodness, a vice president in Gartner Research, looks at the CIO priorities according to Gartner in this interview.
Can you please elaborate on the main findings in the report? Gartner’s research into the top issues facing CIOs and the businesses they support, encourages CIOs to adopt a broader set of leadership positions to help, and often lead, their companies to create value through the use of IT. Reimagining IT, and cascading the reformed image across their business, requires elements of creativity and empathy in balance with financial discipline and organizational self-awareness in terms of technological pragmatism and the supported businesses’ ability to accept and effect change.
Are CIO’s in general on the right track or is a serious acceleration required?
CIOs have begun the requisite inquiries and test-bed projects related to cloud-centric solutions – public, private and hybrid scenarios. Although more than half of the responding CIOs in Gartner’s survey cite progress in moving to technologies that are key to their company’s growth, only 35 percent of CIOs believed that they brought differentiated value to their company relative to their vertical market or industry. While ‘every journey begins with one step’, there is still a lot of ground to be covered in terms of communicating the potential and value of reimagined IT and how reimagined IT is an integral part of any company’s growth plan.
What needs to be their main focus and why?
CIOs must focus on the continued digitization of their company’s business. This will require CIOs to develop an agenda and a communication plan that redefine IT’s contribution to their company’s growth strategies. To do so requires CIOs to assume a leadership role in creating an IT organization that not only evolves with the business but also knocks down barriers for the business to grow in this legacy market or to extend into market adjacencies. This will require significant and constant reorganization within their own CIO organization. Constant change and evolution will also require significant partnering and support from third party consultants and advisors to effect change.
What are the main risks and dependencies for them in the coming year(s)?
Although 81 percent of CIOs in Gartner’s report identify their strategies as having ‘Strong’ or ‘Very Strong’ ties to their company’s overall strategy this does not guarantee that the business accepts IT’s contribution to growth or that IT strategies foster growth. CIO’s will be required to formulate strategies that lead to growth and that differentiate their company in the market. Gartner believes that profound differentiation and innovation rarely occurs without diverse perspectives and deep knowledge found with external consultants and trusted advisors.
According to Gartner predictions 2011 “The No. 1 focus for most companies during 2011 will be growth”.
What impact will this have on a company’s IT strategy? Will they work differently? What will be their main headaches and how do they need to tackle them?’
Gartner’s report offers the concept of ‘creative destruction’ as a means to help CIOs reimagine IT. It is also a pragmatic approach to resources and expertise allocation which is effected by dismantling and redirecting existing ones. Virtualization and cloud computing are key enablers for CIOs to generate resources to support innovation, growth and strategy; however, there remains a skills-gap in many CIO organizations. The skills-gap is related to a lack of knowledge in emerging technologies as well as in a lack of strategic insight and acumen related to the company’s overall business. Increasingly, CIOs will rely quite heavily on external expertise and business acumen to foster and facilitate reimagined IT in collaboration with the CIO organization. Finding the right external resources, that bring technological expertise and business acumen to the table, is a considerable challenge.
The Magic Quadrant for Communications Outsourcing and Professional Services, Worldwide
As this edition of our magazine is all about consulting and professional services, could you elaborate on the most recent magic quadrant on the subject.
The Gartner Magic Quadrants (MQ) for Communications Outsourcing and Professional Services (COPS) focus squarely on the market for businesses to outsource processes to third-party vendors related to the development and integration and the ongoing operation and support of connectivity and corporate communications systems. The market for these services is very large, growing from just under $148B in 2011 to over $170B in 2014. Gartner’s experience in conducting the latest rounds of MQs on the COPS market found that many of the most significant deals were focused on reimagining how companies approach network services and communications systems.
What are the key findings and advice?
Historically, CIO organizations were staffed to address technological requirements; that is, they hired the requisite number of personnel skilled in WAN, LAN and PBX technologies. What we heard in the customer reference interviews, based on conversations with 110 global multinational corporations, is that while maintaining and operating networking technologies and services is no longer strategic to them, the demands of enterprise digitization and the need to migrate to networked IT services is more important than ever. In fact, most of the customers Gartner interviewed combined a blended approach of leveraging both internal and external skill sets to approach enterprise connectivity and communications. This entails both a financial management exercise as well as a technological innovation perspective.
About Eric Goodness
Eric Goodness is a vice president in Gartner Research, where he is the agenda manager and customer lead for Managed Services in the Communications sector. His research and advisory services focus on customer and vendor outsourcing and IT services issues surrounding business communications. Prior to joining Gartner, Mr. Goodness held senior positions within the communications outsourcing and IT services industry.