Gartner: CIOs need to focus on business expertise

CIOs and IT employees need to focus on business expertise as well as IT knowledge, a new Gartner study says
  • Nancy Weil (IDG News Service)
  • 15 February, 2007 08:40

Two of three companies aim to grow faster than their markets this year, making it more important than ever for chief information officers to shift their priorities to encompass business objectives, according to a survey from Gartner.

CIOs who do that will differentiate themselves, and their enterprise IT departments, and be leaders in an emerging trend where they and their employees have more business skills and acumen, said Mark McDonald, group vice president and head of research for Gartner EXP. Gartner has surveyed CIOs for the annual study since 2002. More than 1,400 CIOs were queried worldwide.

Gartner has identified four strategies that CIOs should pursue: technical excellence; enterprise agility; information effectiveness; and innovation. The third strategy involves using analytics and applying information to how business decisions are made, rather than how information is moved around a company's computer systems. Companies that "look at [information] as a resource as opposed to an asset to be managed had significantly better performance," McDonald said.

Interestingly, the survey found that 86 percent of respondents identify innovation as critical to success, but only 26 percent said that innovation processes are sufficient to achieve goals. Although a corporate environment or culture that does not encourage innovation was flagged as the number-one roadblock, the survey found that among those who said that innovation processes are sufficient, corporate culture wasn't mentioned.

Rather, those companies approach innovation as a "structured process" that generates results. Those enterprises also have "technology effectiveness," with IT departments that operate at "a service level" but keep costs under control.

As for budgets, the survey found that IT departments on average will have more money for the fourth year in a row, but just 3 percent more on average and 3.4 percent among U.S. companies whose CIOs were surveyed. That's not much and points to the need to "do more with what you've got" as opposed to doing more with less, McDonald said.

Along those lines, successful CIOs understand that "business knowledge has to become the highest common denominator across the IT shop." That presents a challenge for some companies where the IT department focus is more on technical expertise.

"My coder should know how my company makes money regardless of the work they do," McDonald said. Ensuring that means that "you have to change the source of new recruits."

More than 70 percent of CIOs anticipate they will hire new employees from IT shops at other companies rather than "tapping into the reservoir of talent within their own businesses." Recruiting from other IT departments means you wind up with "more of the same rather than someone who is different," he said.

CIOs also need to focus on training for employees they already have, to help them develop heightened business acumen. That could include something as simple and inexpensive as brown-bag lunch sessions, McDonald said.

Overall, Gartner finds that CIOs need to focus on "the next big round number" and develop a vision for 2010. The last such focus was in 2000 when "everybody was kind of willing to celebrate, but they were celebrating and laying out grand strategies with an eye over their shoulders because they weren't sure if their systems were going to collapse," he said. CIOs who don't look to 2010 and communicate a vision for their departments will find that others do that for them, McDonald said.