Keep Your Balance

Keep Your Balance

Business is facing a tough year. CIOs need to balance the immediate with the important

CIOs who want to maintain credibility must be able to deliver short-term results, while still maintaining the long-term view, according to Gartner's 2002 survey of its 1500 CIO Executive Program (EXP) members. The survey captured the top 10 enterprise business trends, the top 10 IS management issues and the top 10 technology trendsThe clear message is that 2002 is shaping up to be more difficult than 2001 in terms of economic and business pressures. Difficult decisions have to be taken now. CIOs need to balance the immediate with the important, to make sure they control costs and deliver real value without cutting into organisational muscle.

Top business trends The top two business trends are increased pressure on enterprise costs and budgets, and the demands for greater stakeholder returns. The economy continues to be volatile. Even where the signs are positive, the real business emphasis is now on net profits, real profits, not revenue or growth at any cost. Concurrently privacy and security are key issues increasing restrictions on enterprise degrees of freedom.

IT budgets, which have been growing around 10 per cent year-on-year for several years, have now stalled. At the same time there is a demand for extra-budgetary expense on security. It's not all bad news though. It is somewhat easier to recruit and get the right mix of business skills and competencies, and the impact of consumer activism is less than a year ago.

Top IS management priorities Three main findings summarise IS management priorities: improve business and technology synchronisation, deliver value while cutting costs, and fix security and business continuity.

The top two priorities focus very much on the "demand"side of the CIO's role - working on linking the business and IS and providing leadership and guidance for the board and executive. The CIO needs real "bench strength"to do this, so it wasn't surprising that the importance of developing leadership and behavioural competencies for the IS executive team rose to position four on the IS management agenda for 2002.

Demonstrating business value was also in the top five. This implies that projects with longer payback periods will be put on the back burner for another year or two when cost pressures are expected to have eased. Despite this trend, a key short-term priority was fixing security and business continuity post-September 11.

The good news is that finding IS staff in 2002, compared with 2001, is easier because of the global economic downturn. This pause will also allow the technology base to mature.

Top technology priorities The prevalent requirement to demonstrate short-term business value has changed technology priorities. The top technology priority is to enhance security tools, followed by working on Web design and content management. From this, it appears that in 2002 at least, the focus will be on short-term infrastructure needs rather than longer-term projects.

Aggressive enterprises are taking advantage of today's difficult economic environment by rationalising fragmented infrastructure and by improving interconnectivity of applications infrastructure. They are achieving this by a mix of short-term, immediate payback initiatives and medium-term components including middleware, integration, messaging, and Windows 2000 deployment.

Based on these survey results, we advise enterprises to continue laying the foundations for enterprise e-enablement, working on internal e-enabling infrastructure, enterprise portals, and building a small number of inter-enterprise e-enabled business processes.

The problem associated with tighter cost control is that it forces experimentation with new technologies to be put on hold. But neglecting newer technologies completely may leave the enterprise exposed. Although money is tight, enterprises that continue to experiment with new technologies - however judiciously - are more likely to gain advantage in a couple of years than those that neglected their future.

Again, there is some good news. By 2005, infrastructure for mobile technologies is expected to be in place, even though it's not clear when, and how this infrastructure will occur.

CIO are becoming more business-critical. We asked CIOs about their career aspirations. About 45 per cent of EXP CIOs report to CEOs and 80 per cent expect to within three years.

CIOs are clearly a mobile group with 75 per cent expecting to be on the move and much of that into other executive positions. Over one-third (38 per cent) indicated they would take on a CIO role in a different enterprise or division. However, almost the same percentage (37 per cent) said they expected their next move to be to a general business role. Some 30 per cent had no plans to move.

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