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Competing in 2020:6 Initiatives CIOs Must Get Right Today
David McNally
Vice President, IT Executive Advisor
February 6, 2013
2
Agenda
2020: Where We Are Headed
The 6 Initiatives CIOs Must Get Right in 2013
The CIO Change Agenda
Essential Guidance
Questions and Answers
© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights
The 3rd Platform Shift:From IT Productivity to Business Productivity
PublicSafety
Omnichannel Retail
Smart Buildings Connected
Health
Smart Cities
Intelligent Industries
ConnectedVehicles
Smart Grid
MobilePayments
3
InnovationInformation
ServicesSystems
Business
Agility
IT
Agility
3rd Platform Implications for CIOs
3
On the Right Track:CIO’s 2013 Personal Agenda
In 2013, which of the following goals will be top of your personal agenda as CIO? Select top 3 goals.
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Implement a more rigorous process to evaluate new ideas for IT to take on
Re-skill existing IT talent
More effectively attract new IT talent
Carve out more IT budget for new projects/innovative projects
Focus IT organization on better understanding the requirements of the consumers
Better align IT with the business
Foster a culture within IT where IT more often provides a qualified "yes" to the business
Foster a culture within IT that drives more innovation
Focus the IT organization more on business strategy than technology strategy
0% 5% 10% 15% 20% 25%
USWETotal
n = 70WE respondents = 21; US respondents = 49Source: IDC 2013 CIO Agenda Survey, Fall 2012
4
5
Agenda
2020: Where We Are Headed
The 6 Initiatives CIOs Must Get Right in 2013
The CIO Change Agenda
Essential Guidance
Questions and Answers
© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights
By 2016, LOB executives will be directly involved in 80% of new IT investments
#1. New Working Relationships with the Business
6© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights
It is time to revisit IT Planning, Governance, and Portfolio Management methods
Of the new internal IT projects initiated at your company this year, what percentage will be led under the following
scenarios?
N = 57Source: IDC 2013 CIO Sentiment Survey, Fall 2012
Prediction
Companies will initiate an average of 40 new IT projects in 2013 (with or without IT)
58% of IT investments in 2013 will involve direct participation by LOB executives
Businesses participation in IT projects will grow to 80% in 3 years
The implications are vast on how the CIO works with the line of business
Situation Assessment
Cloud, social and mobile services are the great equalizers of the corporate machinery
Notable instances of CEOs & CFOs driving the migration to Cloud and Managed Services
Project solely led / managed by the LOBs
Project led / managed by LOBs, but subject to review by IT
Project jointly led / managed by IT and the LOBs
Project solely led / managed by IT
0% 10% 20% 30% 40% 50%
8%
17%
33%
42%
7
#2. A “Cloud First” Strategy
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Cloud Agenda Items for 2013
n= 47Source: IDC CIO Cloud Study. April-June, 2012
Prediction Today, only 23% of enterprises have a “cloud
first” strategy for new IT purchases Cloud architecture standards, cloud service
management processes and cloud migration paths will spur grow
Experience in cloud initiatives will address the current “skills gap” identified by many CIOs
CFOs Will Accelerate “Cloud First”
Situation Assessment
Software vendors aggressively investing in cloud
SaaS provides a direct linkage between solutions and business demand in a self-service model
Cloud will be required platform for some industry specific analytics based solutions
70% of CIOs will Embrace a “Cloud First” Strategy in 2016
#3. A Mobile Application Strategy
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Prediction
In 2013, 33% of all new apps will target a mobile form factor
IT must decide on the Mobile OS and device strategy as 46% of mobile app budget goes towards maintenance
More apps, integration and multi-platform development will drive 60% of new mobile app development to IT services providers in 2013.
Enterprise mobile app penetration will force either: a move to a standard corporate-liable devices (for compatibility) or multi-platform development
Situation Assessment “Mobile devices are the new primary design point” Development portfolios skewed toward
customers, sales, and service functions
Mobile and Non-Mobile Devices
Mobile Only Devices
Non-Mobile Only Devices
0% 20% 40% 60% 80%
16%
17%
67%
What % of new Apps will be for Mobile Devices vs. Non-Mobile Devices
IDC’s CIO Mobile SurveyFall, 2012
8
By 2013, one third of all new application development will target a mobile form factorBy 2013, one third of all new application development will target a mobile form factor
9
#4. An Enterprise Social Network Strategy
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Prediction
CIOs will seek out business sponsors in 2013 to move enterprise social networks beyond the pilot stage
Social tools will be integrated with enterprise apps connecting people inside and outside the firewall
Solutions for collaboration and file sharing will remain popular projects, owned by the CIO
E-mail persists but becomes more social
Situation Assessment
Cultural fit is essential to success Business case can be difficult - 82% of CIOs are
unable “. . . to accurately measure the ROI of our social business apps,” according to IDC social survey.
Security, compliance and IP protection will remain barriers. 68% of U.S. CIOs have no formal policies regarding data retention of social data in place
Social business maturity often starts with experimentation (a pilot)
Enterprise social networks move beyond pilot stage with business sponsorship
10
#5. An Analytics Strategy for Intelligent Solutions
The Challenges CIOs Will Face
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Prediction
Get ready for a whole new IT project - more experimenting, less predictive outcomes; shortage of talent; and, 60 day project plans.
Talent (both IT and analytics) needs to be able to create answers to undefined questions
Situation Assessment Big data/analytics projects are changing the
way businesses make decisions CIOs must understand how to succeed Data architecture, data quality and data
governance are major gaps in large enterprises The technology will be easy when compared to
the business case Seeking major funding for a rapid development
with no certain value
Poor data quality
Insufficient specialized analytical skills required for use
Design and deployment time is too lengthy
Insufficient specialized IT skill-sets required for implementation
Data integration is very complex
High costs of technology
Insufficient computing resources
22%
27%
28%
31%
40%
47%
22%
Business Analytics Challenges
Source: IDC 2012 Vertical IT & Communications SurveyN = 2699
Lack of business support and/or business units do not understand the benefits of Big Data
Not knowing how to decide which technology is best/most appropriate technology for different types of Big Data analysis
Not having enough or the right analytics staff to analyze the data
Not having enough or the right IT skills to manage Big Data projects
Cost of technology infrastructure
Deciding what data is relevant (what data to keep/store and what data to discard)
9%
9%
10%
11%
13%
25%
Big Data Challenges
Big Data & Analytics projects will be like no other IT project
11
#6. IT Talent for the 2020 IT Organization
Prediction
CIOs have a wide range of IT talent issues highly correlated to location and industry including:
Recruiting Retention Talent Development – Skills and Leadership Performance Management
Inability to access new skill sets will limit an IT innovation
Situation Assessment
CIOs will need to cultivate best practices in IT talent strategies:
Assess current state and today’s needs Define future organization and skill needs Create the internal talent strategy Re-think sourcing strategies to fill the gap Assessing external IT talent
© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights
51%49%
Building IT Systems
Governing and Managing IT Systems
Out of the IT FTE in 2013, what percent do you estimate will be allocated to
the following activities?
N = 57Source: IDC 2013 CIO Sentiment Survey, Fall 2012
47%
53%
Building IT Systems
Governing and Managing IT Systems
2018 2013
IT Talent will be become the biggest barrier to innovation
12
Agenda
2020: Where We Are Headed
The 6 Initiatives CIOs Must Get Right in 2013
The CIO Change Agenda
Essential Guidance
Questions and Answers
© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights
13
What Will the CIO’s Role Look Like in 2020?
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Operational CIO Business Services Manager Chief Innovation Officer
1993 90% 10% 0%
2013 70% 20% 10%
2018 10% 40% 50%
Goal Keep the Lights on Provide an agile portfolio of Business Services
Business Innovator
Focus Costs and Risk Service Excellence Business Value
Jobs Scope Data Center, IT Ops Both Business and Technology Service Catalog
Business Processes, Capabilities and Analytics
Prediction
By 2018, 50% of business executives will view their CIO primarily as a partner for business innovation and improvement. The other 50% will see them as owners of costs, risk and services.
While CIOs may need to play all three roles, the key is business perception. This has broad implications on the CIO Agenda.
The transition from a portfolio of systems & technologies to a portfolio of services positions the CIO to engage in business innovation and improvement.
By 2018, 50% of Business Execs will view the CIO as a Business Innovator
CIOs can own the Change Agenda to reshape IT
• Run IT Like a Business
• Become a world class provider of Business Services
• IT Strategies that transform IT (if not the business)
• Sell the business value of Agility and the 3rd Platform
• Plan your Legacy Migration Strategy
• Get out of the data center business
• Move to a Zero Capital funding model
• Foster 3rd Platform Innovation in IT - Cloud, Mobile, Social, and Big Data / Analytics
14
“If we don’t sell change someone else will!”
Run IT Like a Business – Account Management Separate IT Systems from Business Services
Business Relationship Managers• Source Information Services both internally and externally• Develop Service Metrics• Serve middle management – the source of much innovation
CIO
Ops.App. Dev. InfrastructureArch.RelationshipMgt.
IT Management
Services“Business Service
Strategy, Sourcing and Innovation”
“IT Service Management - Competing for Services”
15
Apps, Infrastructure & Operations compete for market share
Architecture manages an Extended Information Architecture
and Service Integration
16
Run IT Like a Business – IT StrategyStrategy Maps can link the IT Agenda to the Business Plan
** Based on The Balanced Scorecard, Kaplan/Norton
Financial
Custo
mer
Operational
Technology
Theme: Pricing Elasticity based on Market Insight
Gross Margin Improvement
Sales Efficiency
Customize Pricing
Special Offerings
Market-based Product Pricing
Mobile Pricing Tools
Market Analytics
Business Driven
Top down
Strategy
17
Run IT Like a Business – IT StrategyStrategies can also target Agility, Service Integration, etc
Capabilities
Solutions
Technology
Architecture
Theme: Data Quality and Accessibility
Analytics / Insights
Enterprise Data
Warehouse
Integration (EAI & ETL)
Business Intelligence
Tools
Data Cleansing
Architecture
** Based on The Balanced Scorecard, Kaplan/Norton
Mobile Pricing Tools
Market Analytics
Capabilities
Driven
Bottom Up
Strategy
Fostering 3rd Platform Innovation in ITEarly Adopters took small steps in the right direction
Cloud• Migration to Public Cloud for development and testing
• Architecture reviews, Service Integration and Data Integration for SaaS solutions
• Update Sourcing practices to respond to Cloud Services
Mobile - 1/3 of all new Application Development will target mobile
• In-house mobile development pilots
• Moving field, sales, and support apps to mobile solutions
Social• Adoption of File sharing and Collaboration tools both within IT and for projects
• Offer solutions to remote worker, sales and field operations
• Develop Unified Communications solutions
Big Data / Analytics• Adoption of Open Source Tools and Cloud Services for Big Data
• Rewriting legacy apps in Pig Latin
• Identify dynamic data sources
18
19
Agenda
2020: Where We Are Headed
The 6 Initiatives CIOs Must Get Right in 2013
The CIO Change Agenda
Essential Guidance
Questions and Answers
© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights
Essential Guidance “IT’s about the Information not the Technology”
Adapt and Thrive!
Redefine the Role of the CIO before the business does!
Manage Business Relationships the way your best vendor would
Develop Business Service Management metrics
Develop IT strategies that create Agility
Foster 3rd Platform innovation within IT
Plan for an Extended Enterprise Architecture
Get ready for IaaS as a CFO imperative
Next Gen Sourcing and IT Talent strategies will enable the transition to Information Services
20
The right portfolio of services and systems will enable the agile enterprise and
separate winners from losers
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 21
Questions and Discussion
David McNally
Vice President, IT Executive Advisor
IDC is the premier independent global market intelligence, events, and advisory firm for information technology, telecommunications, and consumer technology markets
IDC is a subsidiary of IDG, the world's leading technology media, events and research company
IDC has been delivering IT intelligence, industry analysis, market data, and strategic guidance since its 1964 founding by Patrick McGovern
More than 1,060 IDC analysts, including in-house statisticians and economists, provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries
Our multilingual, multicultural workforce surveys over 300,000 technology users and decision makers annually, delivering unrivaled coverage
We advise IT professionals on making more effective technology decisions by providing insightful fact-based research and consulting services
IDC Overview
22
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 23
IDC’s IT Executive ProgramsWhy IDC IT Executive ProgramsIDC's IT Executive Programs consists of a family of research programs intended to help today's time-constrained IT executives make more effective technology decisions.
The program offers accurate and timely fact-based research and programs that will assist IT executives in mitigating technology risks, maximizing the effectiveness of IT investments, identifying and capitalizing on new opportunities, and bringing forth solutions that are aligned with the organization's business objectives.
Our IDC IT Executive Program offers you: Flexible options for a program that is right for you Easy analyst access A CIO Advisor Peer group through the CIO Executive Council
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 24
IDC’s CIO Agenda Practice
Why IDC's CIO AgendaIDC's CIO Agenda research program recognizes that an IT executive's time is better spent engaging the business around IT than managing day-to-day IT operations.
CIO Agenda supports IT executives in creatinga business-based IT organization by providing strategies, best practices, frameworks, and advice around the most important issues on a CIO's agenda: Emerging IT Strategies Case Studies on IT Transformations Peer Benchmarking on Best Practices IT Performance Metrics IT Spending Surveys
Deriving Business
Value through
Information
Planning for End
User Devices of
the Future
Incorporating Social
into Workplace
Collaboration
Replatforming
Around the
Cloud
Governance, Risk &
Compliance
Framework
IT Enterprise
Architecture
IT Financial Mgmt
Strategies
IT Staffing &
Organizational
Strategies
Service Mgmt
Strategies
App/Dev
Architecture and
Strategies
Data Mgmt,
Governance &
Information Security
IT Sourcing &
Procurement
Strategies
Working with the
Business
Innovation
Strategies
Maximizing IT’s
Performance
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 25
IDC’s IT Benchmarking and Sourcing Practice
Why IDC for Benchmarking and SourcingIDC's Benchmarking and Sourcing research is a set of solutions designed to ensure that your technology purchasing and deployment decisions are optimized.
With 50% of the Fortune 500 companies having accessed our research, IDC is the pioneer in helping organizations establish best in class and benchmarking metrics.
Our IT Benchmarking and Sourcing research will enable you to: Drive spending efficiencies to allocate savings
towards innovation Get the best pricing for your strategic IT
investments Validate costs against peers Stay ahead of market trends within the IT
industry
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 26
IDC’s Mobility Practice
Why IDC for Mobility DecisionsOur fact-based global research team of 20 full time analysts and over 100 contributing analysts worldwide covering mobile devices, network infrastructure, telecommunication services, software, and semiconductors can help you with the following mobility decisions:
How is mobile technology transforming the way our organization needs to interact with customers, employees, and partners?
How do I manage corporate-liable and employee-liable devices?
What is the threshold for Corp App Store adoption? What are my organization's must-have security,
access management and compliance features for mobility?
What are the different usability functions and security requirements for different workers and types of information?
What security components do I incorporate into an app?
What capabilities can mobile management systems provide to support CIO needs?
IDC’s Mobile Device Decision Framework
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 27
IDC’s Cloud Practice
Why IDC for CloudOur fact-based global research team of 33 full time analysts and over 100 contributing analysts worldwide covering cloud applications, platforms, infrastructure and service around cloud help you with the following cloud decisions:
How do organizations assess their readiness for cloud?
What impact should cloud have on the data center? What should organizations be looking out for in cloud-
based service-level contracts? What strategies should organizations deploy to ensure
optimal cost/performance in their cloud contracts? What are strategies for buyers to link contracts and
payments to user success? What options do companies have to protect their data
and IP in cloud deployments? What do organizations need to know about secure
cloud transactions?
IDC’s Cloud Progress Monitor
Source: IDC Cloud Study, 2012
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 28
IDC’s Big Data and Analytics Practice
Why IDC for Big Data and AnalyticsOur fact-based global research team of 7 full time analysts and over 100 contributing analysts worldwide covering analytics and data management software, industry applications, server and storage infrastructure, high performance computing, and professional services help you with the following big data and analytics decisions:
How do I measure the readiness of my organization for effectively leveraging big data trends and technologies?
How have my peers harnessed big data technologies and trends?
What best practices are emerging? How have others defined and generated value? How will big data technologies evolve? What leading indicator should I use to pace the level
of technology evolution around big data? How should I ready my IT infrastructure and
architectures?
Big Data/Analytics Challenges
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 29
IDC’s Social Practice
Why IDC for Social BusinessOur fact-based global research team of 21 full time social business analysts and over 100 contributing analysts worldwide covering social customer relationship management, enterprise 2.0 and collaboration, partner networks, supplier networks, unified communications, social commerce and social infrastructure, can help you with the following social business decisions:
How can organizations use social business for a competitive advantage?
How do CIOs enable and support the adoption of social business tools across the business?
What’s business value can be created by integrating social technologies with enterprise systems?
How do organizations overcome the challenges they face when enabling /allowing employees to use social business tools?
How do organizations calculate ROI and risk? How do CIOs create an architecture that can change
as our expectations of the social network change?
Social Software Adoption
30
IDC is the premier global provider of market intelligence, advisory services, and
events for the information technology, telecommunications, and consumer
technology markets. IDC helps IT professionals, business executives, and the
investment community make fact-based decisions on technology purchases
and business strategy. More than 1,000 IDC analysts provide global, regional,
and local expertise on technology and industry opportunities and trends in over
110 countries worldwide.
30© IDC Visit us at IDC.com and follow us on Twitter: @IDC and @IDCInsights