Understanding the Tech Initiatives & Priorities of Today’s CIOs
It’s that time of year again; CIO’s annual State of the CIO report is released. This year’s survey examines how CIOs are seeing their role transition within their respective companies as technology continues to drive business forward.
To bring this data to life, SVP/General Manager, IDG Events & Publisher, CIO, Adam Dennison hosted a webcast featuring Shannon Gath – VP and CIO of AMAG Pharmaceuticals; Nicole Raimundo – CIO for Cary, North Carolina; and David Behen – VP and CIO of La-Z-Boy. During their conversation, they discussed many of the research findings, including the different responsibilities within CIO leadership, priorities of tech executives, and the importance of communication.
Taking on Strategic Initiatives
Over the previous 10 years of the State of the CIO research, there was almost always a clear distinction between strategic, functional and transformational CIOs, with the majority of CIOs having a transformational role. However, recently there has been a shift towards strategic CIOs. In 2017, half of all CIOs surveyed were considered transformational, with only 31% in the strategic category. This gap narrowed this year as 42% of CIOs sit in the transformational bucket and 40% in strategic.
This fluctuation can be partially attributed to the fact that CEOs are leaning more and more on CIOs and the IT department to lead digital business initiatives and strengthen IT and business collaboration. No longer are the days where IT solely improved the company’s IT operations and systems performance. Now the CIO finally has a true “seat at the table,” developing and refining business strategy, identifying opportunities for competitive differentiation, and driving business innovation. In the coming years, these responsibilities are likely to expand even more with strategic CIOs expected to increase to 58% within the next three years (2023).
However, many companies out there don’t expect to be limited simply to the “strategic” sector. La-Z-Boy is an example of this. David Behen doesn’t see his team ever getting out of being functional but does view them as being in all three categories. At the end of the day, it will always be necessary for IT to maintain security, systems operations, technology crisis control, among other traditional roles; but by moving forward into other areas of IT, CIOs are able to be incredibly good partners for enhancing the business.
IT Executive Priorities are Expanding
As CIO responsibilities continue to transform and expand, it is a very good thing that their priorities are in lockstep with their CEOs. Of those surveyed, 39% of all CIOs shared their CEO’s top priority for IT in 2020 is leading digital transformation initiatives, followed by upgrading IT and data security to boost corporate resilience (31%).
Shannon Gath of AMAG Pharmaceuticals has found success with having her IT team maintain a wide variety of responsibilities, specifically when it comes to determining where to spend their budget. Since her IT department has a wide range of roles, it forces them to come into meetings with their “enterprise hat on” and not simply focus on the functional aspect of their job. This encourages the team to look at the bigger picture throughout the organization and not just their individual department. Additionally, this practice assists in making sure any responsibility from revenue generation to risk mitigation is completed as a team. By taking this approach, AMAG has been able to make sure they invest their budget in the most efficient ways.
This expansion beyond traditional IT responsibilities is supported at La-Z-Boy. Behen has found “not many people are making significant moves in their companies without talking to someone on the IT team,” regardless of their area of expertise. By allowing technology leaders to have this high level of impact during the business decision-making process, companies are becoming much more integrated between all departments. As CIOs and their teams look to enhance the business and collaborate across departments, they are seeing new ways to drive revenue, as 67% shared that revenue-generating initiatives are in their purview.
Communication is Key
Staying consistent with last year, 78% of CIOs say that they are communicating with the Board of Directors more than ever before, with this figure increasing to 83% for strategic CIOs but decreasing to 72% for functional CIOs. This increased level of communication aligns with the tasks making up strategic agendas, such as developing and refining business strategy and driving business innovation.
All three of the CIOs who participated in the webcast agreed that communication with line of business executives has been one of the most important aspects in finding success. For Gath, she says her communication is dependent on timing and what AMAG needs at the current moment. At La-Z-Boy, Behen does his best to distribute his communication as equally as possible, keeping in contact with a variety of departments and believes there should be a need and desire to overcommunicate more with line of business to make sure everyone agrees on what is best for the company. However, he made sure to note that for budgets and supply chain, the CFO has a special place in his inbox. Cary, North Carolina’s Nicole Raimundo found her experiences aligning closer to Behen’s – she does her best to meet with everyone to understand their primary needs, but at the end of the day, “finance is [her] best friend.”
As important as communication is with senior IT executives and the Board of Directors, the relationships IT builds do not stop there. Over half (52%) of CIOs also depend on strategic vendors for advice, followed by their peers (42%). Insight provided by the panel suggested that the biggest difference between the two is that typically vendors simply follow their contractual agreement whereas your peers are willing to go above and beyond their expectations.
With CIOs’ roles expanding and the need for communication at all levels increasing, stronger integration between all moving parts of a company, vendors included, will do nothing but make driving business forward easier and more efficient for all.