Why CIOs Aren’t Developing And Executing A Digital Strategy
From A Technology Role To A Business Role
In a world where every single enterprise is now a tech company, the chief innovation officer (CIO) might be the most important executive in the organization. The effectiveness of the CIO to enable technological changes and drive business strategy will make — or break — the enterprise’s ability to execute a successful digital transformation. Unfortunately, many CIOs are lagging behind.
Deloitte released its 2018 global CIO survey in August to shed a light on the latest trends in the industry. In its survey of more than 1,400 executives, Deloitte revealed that 44% of CIOs are not actively developing or executing a digital strategy for their enterprise. This contradicts the idea CIOs are the engine behind an enterprise’s digital transformation.
As the survey revealed, only a quarter of CIOs have initiated an enterprise-wide digital strategy. Instead of being a driver of digital transformation, many CIOs are still just focused squarely on efficiency and reliability of technologies to meet current business needs.
This wasn’t the only survey this year to suggest that the role of a CIO should change from IT-outcome-focused and IT-risk-focused to business-outcome-focused and business-risk-focus. A 2018 survey from Gartner found that 95% of CIOs expect their jobs to change due to digitization.
Why Is It Important That CIOs Develop An Enterprise-Wide Digital Strategy?
As enterprises embrace digitization, it is up to the CIO to launch the necessary changes in order to reach digital transformation. Without an active approach from the CIO, the enterprise will fall behind competitors and miss out on opportunities.
"It's hard to overstate the importance of leadership at all levels of transformation," said Kristi Lamar, managing director and experience leader in Deloitte Consulting LLP's CIO Program and co-author of the report. "All CIOs can learn from the inward, across, and beyond framework to take stock of their organization's capabilities and challenges and move forward in an increasingly disruptive marketplace."
The Deloitte survey identified the 10% of CIOs who enacted changes that enabled their enterprises to embrace new technologies and become a market leader in digital transformation. Nicknamed as “vanguard CIOs” in the survey, these leaders go beyond the IT department by staying involved in all different aspects of the business. The “vanguard CIOs” experience stronger relationships with other departments in an enterprise when compared to their colleagues in other organizations, including better relationships with the sales team.
Although organizations with “vanguard CIO” are still working on their digital transformation, there is a noticeable difference in terms of the CIO’s role. The responsibilities of a “vanguard CIO” include acquiring IT talent, training them, and securing long-term funding.
"CIOs need to be deeply involved in both developing and executing digital strategy and transformation, from planning the initial investment to deliberate adoption of technologies," said Khalid Kark, US CIO Program research director at Deloitte LLP."
How Can CIOs Take The Next Step To Develop A Digital Strategy
In order to become a “vanguard CIO,” it is imperative that the CIO focus on growing the business through a successful digital transformation. This will require the CIO to develop a business skillset beyond technology to improve enterprise-wide performances. A good starting point would be to use the newly acquired business skills in the IT department to recruit new talent, use new technological solutions, and set funding objectives.
In the survey, Deloitte suggested that CIOs modernize the technological core of the enterprise to serve as a thriving foundation of emerging technologies. Since this is a time-consuming process, it is also recommended that the day-to-day management of IT be delegated to another team member within the organization or to outside vendors. This will allow the CIO to become more like a leader in their organization.
"What we have seen in last three years is the CIO is presenting to the board regularly," said Stephanie Woerner, a research scientist at the MIT Sloan Center for Information Systems Research. "I wouldn’t say five years ago this was the case, but we’re seeing it across industries; that digital is so important the CIO is really working across the entire enterprise."