The Evolving C-Suite: CIO as Value Broker

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Contents

OverviewResearchResultsCIO as Value Broker Trait 1 Trait 2 Trait 3 Trait 4 Trait 5

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Overview

The rise of new technology is transforming the way we work. It’s no longer a question of when or if organizational leadership will change as a result, but how.

One of the most significant shifts in roles is occurring for the CIO. As the technological environment changes, it is inevitable that the role of the CIO—and the interplay between the business and IT organizations—shift as well.

In a series of conversations with IT and finance executives across the country, we discussed the changing dynamic between business and IT, and the increasing expectation for the CIO to convey business value.

The research reveals that the CIO must now act as a Value Broker, and that this will affect the transformation of the CIO in 2015 and beyond.

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Our research shows that the CIO’s role is changing rapidly.

Research

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8 104 92Months of Research IT and Finance

ExecutivesCompanies

Over 8 months, we conducted one-on-one calls and group workshops with industry-leading IT and finance executives.

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Top Industries Represented

Professional Services

Banking, Finance, Insurance

Healthcare

Technology

25%

17%

13%

11%

CISO

CIO & IT

CFO & Finance

3%

22%

75%

Executives in Participation

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The workshops were held in cities across the country, including the following:

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“In today’s world of speed, automation, and agility, the way [we] measure value for IT investments is changing.”

-Paul Chapman, CIO of HP Software, in an exclusive interview with Ecosystems

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Results

Ecosystems | CIO as Value Broker 9

Ecosystems | CIO as Value Broker 10

The rise of shadow IT and organizational consumerism are affecting the dynamic between business and IT, requiring CIOs to alter their function to effectively lead internal stakeholders and coordinate external vendors. As of 2014, 70% of business executives are willing to run their own technology projects, without the involvement of internal IT.

The business is bypassing internal IT to work directly with external providers.

Vendor

Vendor

Vendor

CIO

Not only are 70% of executives willing to run their own technology projects, but they have the financial resources to do so as well. Gartner predicts that 90% of the IT budget will be controlled by the business by 2020. At the beginning of the decade, the business only controlled 20% of the IT budget.

IT budget control is shifting to the business.

20% 90%

2000

35%

2014 2020

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Gartner conducted a study of 2,053 worldwide CIOs, managing a total of more than $230 billion in IT budgets. Results showed that organizations achieve only 43% of technology’s business potential.

That represents a significant gap in the business’s ability to realize the full value of technology investments. With the business in control of the IT budget, the CIO should expect to hear an increasingly common question from the business to IT: “For the check I wrote you, what value did we achieve?”

The CIO’s ability to maintain a strategic role in the organization will depend on his or her ability to clearly and sufficiently answer this question—and provide the structure to ensure that the full value of each investment is achieved.

. . . But only 43% of IT investments are achieving full value.

43%of IT investments do not equal full business potential

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CIO as Value Broker

5 Essential Traits

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The CIO has recently been considered a “service broker,” where the focus is on “connecting business units with the best technology.” Now, there is an additional shift required of the CIO—the CIO must become a “value broker” between the business and technology.

The emerging role of the CIO not only connects the business to technology, but can also advise the business on strategic connections and convey the value of these connections to diverse groups of internal and external stakeholders.

To merely connect the business to the appropriate technologies is no longer enough—the CIO must also understand and convey the value of connecting the business to providers and services, and ensure that investment value is achieved.

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Four specific trends emerged from our research, based on challenges and opportunities faced by today’s CIO.

4 Trends for the New CIO

The CIO will need to enable aggressive innovation by providing the overall architecture needed to support business strategy. The focus is no longer on specific technologies but instead on the overarching strategy for implementing various technologies.

The CIO needs to deploy technology that is both effective and easy to use. Internal stakeholders will be the CIO’s “customers”–looking for efficiency and speed.

The parts within the IT organization must be integrated to work together effectively. CIOs will be expected to reduce the amount of time it takes for this to occur–from months down to weeks or even days.

The number of providers to the business is increasing, and budgets are shifting toward the control of the business. For the CIO to truly enable the business, there must be clear value definition for each investment.

Focuses Inside and Outside of the Organization

The CIO must focus inside the organization in order to understand the true business problems that need to be solved. However, the CIO also needs to maintain a thorough understanding of current

technology trends and best practices outside of the organization in order to identify the best solutions.

1

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Not Defined by “Power”

A new mindset accompanies the shift in the CIO role, as the value of the CIO is no longer determined by the number of people in the

IT organization or the amount of assets over which the CIO has control.

In fact, as companies arise that do not have physical assets in the traditional sense–think Airbnb and Uber–this shift is even more

apparent. Now, the CIO’s value is established by his or her ability to contribute to business strategy and whole value, particularly by conveying the value of connections with an ever-growing

population of technology providers.

2

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Advises the Business

Rather than focusing on tactical IT execution, the CIO is now expected to be the expert on the best technology available to

provide business solutions. In order to do this, the CIO must stay up to date on technology innovation and maintain a thorough understanding of the technology available to the organization.

3

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Orchestrates Providers

The CIO must orchestrate providers to build a strong ecosystem and fill any gaps for the business. By intentionally and strategically coordinating providers, the CIO can unite the best services to build

a highly efficient business solution.

4

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Markets IT Value to the Business

In order to convey the value of connections with providers, the CIO has to approach each investment as a project that needs to be

communicated and marketed to internal stakeholders. Achieving the full value of an investment requires communication of the value that is intended, with clear outcomes and owners, and

frequent communication back to stakeholders on project value.

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Ecosystems

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June 2015, Ecosystems

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