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Gartner: The time is right to make IT a boardroom issue

In many businesses, IT is regarded as an internal service provider and cost centre. Gartner says now is the best time for CIOs to make IT strategic

At the annual Gartner Symposium for CIOs, held in Barcelona, the analyst firm urged delegates to work on breaking IT free of ingrained attitudes.

Gartner research director Ed Gabrys said that from the conversations the analyst firm has had with business and IT leaders, the time is right for CIOs to take leadership in a technology-led business strategy.

“CIOs need to step up. The board recognises the CIO is the gateway,” said Gabrys, but added that while there is now an opportunity to enter the boardroom, he is not sure “how many will step through”.

Gartner warned that geopolitics, economics and the emergence of digital giants are creating uncertainty and pressure for CIOs. According to Gartner, these forces are a shift from the normal course of momentum, and board executives now recognise they need to become more focused on meeting these new challenges.

Gartner analysts said the ultimate digital business strategy is about how quickly and how far organisations can digitise their internal operations and their external value proposition.

The 2020 Gartner CIO agenda survey showed that, on average, a fifth of organisations said their products, services and revenue value proposition are digital. The study reported that 39% of their workplace, processes and supply chains have been made more effective with digital technology.

However, top performing CIOs said more than half their operations are digitalised and a third of their value propositions are digital. In 44% of top performing organisations, Gartner found that 62% of internal operations had been digitised.

Addressing delegates at the conference,Valentin Sribar, senior research vice-president at Gartner, said: “Your operations can go digital. You are only being held back by organisational inertia.”

A Gartner study of business executives found that just under a third (31%) only speak with the CIO when something is wrong. However, Gartner predicted that by 2021 at least 40% of IT organisations will shift from an internal focus on creating digital products.

Jan-Martin Lowendahl, distinguished research vice-president at Gartner, said: “In the past, I felt the board was not ready to hear they need to change. But 80% of my onsite engagements is with executive teams.”

A Gartner leadership self-assessment of more than 15,000 CIOs and IT executives showed that the majority of CIOs view themselves as more likely to be reactive or defensive, than assertive.

“CIOs need to get ready for a mental shift if they want to drive the strategy,” said Lowendahl. “CIOs must embrace going on the offensive. This means being able to pivot, generate power and score.”

Throughout the keynote presentation, Gartner analysts discussed how businesses need to reduce costs and invest in technical innovation. Above all, CIOs should shift their focus from keeping the lights on and delivering an IT service to the business, to being at the forefront of digital product development in their organisations.

Sribar warned that “we are heading to another set of economic downturns”. In 2008, he said the companies that came through the downturn stronger were the ones that not only reduced operating costs, but were able to invest in developing new products and services.

Those successful companies had a strategy of where to cut quickly and where to invest for future growth. Oil firm Shell is one example presented during the keynote session. After 2008, Sribar said the company began building out a network of electric vehicle charging points.

Artificial intelligence (AI) and robotic process automation have big roles in Gartner’s vision of the new IT organisation. It predicted that by 2022, 40% of employees will consult an AI agent for decision support. According to Gartner, most environments – particularly complex, data rich ones – will require a partnership between humans and machines, with machines doing the heavy data processing work and people interpreting and reinforcing decisions.

Gartner believes that people will be needed in automated decision support to spot rare events. However, Gartner’s distinguished vice-president, Rita Sallam, said that by 2022, 30% of organisations will use explainable AI to build trust. She urged CIOs and IT executives to focus on shifting security and risk management to protect their businesses and society.

“They should design personalised customer experiences and solid information governance to be a trustworthy custodian of data, and find a social topic relevant to their industry and build a societal value proposition,” Sallam said.

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