In theGartner Executive Programs 2008 CIO
survey, the average CIO's expectation was that
their IT budget would be rising by just more than 3% in 2008,
writesDave Aron, vice-president and research
director in Gartner Executive Programs.
The average is 2.5% for UK CIOs. However, for some CIOs the
picture will be very different, with their CFO knocking on their
door, coming to discuss radical cutbacks.
If you think this might be your situation, you must meet be
ready to provide the CEO and CFO with a strategy for coping with
budget cuts. The recipe for success is threefold:
1. Be clear what your IT costs are, and how they compare to
others in your industry and geography. Where you exceed industry
averages, investigate the reason - it may be inefficiency, or it
may be that you are using IT to drive greater business value and
differentiation.
2. Have a prioritized list of IT cost reduction opportunities,
across both the project budget and utility areas of IT. Have a
recession budget ready, which bakes these changes in to the IT
cost base.
3. Have a clear position on opportunities to invest in
value-added IT initiatives, to support enterprise-wide
cost-cutting, and also enterprise growth initiatives.
Although 2008 will represent a tough time for some, it will also
be an opportunity for the best CIOs to shine, finding ways to cut
utility costs, but also to invest in differentiated capabilities
that will drive enterprise growth and success. While many western
economies are slowing down, many emerging markets are growing fast,
and even in the slower economies successful companies will continue
to grow, partly through mergers and acquisitions.
The CIO survey also revealed that tenure was increasing, with
the average CIO now in place for over 4 years - 3.5 years in the
UK. This gives CIOs the opportunity to see major initiatives
through to the end, build credibility and expand their role and
responsibilities. More than half of all CIOs are taking on non-IT
responsibilities, to add more value and get more engaged with their
business leadership. The most common non-IT duty was business
process improvement, with almost a third of CIOs taking on
responsibilities in this area.
Meanwhile, CIOs continue to be concerned about talent management
in the IT organisation. This was a top priority for one third of
CIOs, but one which CIOs had relatively low confidence in
delivering on. CIOs are concerned about building business and
behavioural skills, strengthening roles such as relationship
management and business process improvement, and managing a
multi-generational IT workforce.
With all these internally-focused leadership challenges, CIOs
are not proactively prioritising environmental concerns and green
IT - that came way down the list of their priorities for 2008. CIOs
must at least be clear on their position here, and be ready to
engage the CEO and board, if the green issue rises up their
agenda.
In short, 2008 is not a year for the faint-hearted CIO - the
circumstances will clearly differentiate between CIOs focused
mainly on running the IT operations and the proactive,
strategy-focused CIO.