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Revenue to Factor in CIO Comp by 2015, Gartner Predicts Print E-mail
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By Rob Garretson

By 2015, the amount of new revenue generated from IT initiatives will become the primary factor determining the incentive portion of new Global 2000 CIOs' annual compensation, according to new predictions released today by research firm Gartner Inc.

According to its “top predictions for IT organizations and users for 2011 and beyond” released today, four initiatives — context-aware computing, IT's direct involvement in enterprise innovation development efforts, pattern-based strategies and harnessing the power of social networks — can potentially directly increase enterprise revenue. Executive and board-level expectations for realizing revenue from those and other IT initiatives will become so common that, in 2015, the amount of new revenue generated from IT initiatives will become the primary factor determining the incentive portion of new Global 2000 CIOs' annual compensation, Gartner said.

The prediction is among eight that Gartner analysts say highlight the significant changes in the roles played by technology and IT organizations in business, the global economy and the lives of individual users. They also include forecasts that 80 percent of businesses will support a workforce using tablets in just two years and that by 2014 , 90 percent of organizations will support corporate applications on personal devices. The projections were gleaned from among more than 100 of the strongest Gartner predictions across all research areas were submitted for consideration this year, the firms said.

"Gartner's top predictions showcase the trends and disruptive events that will reshape the nature of business for the next year and beyond," said Brian Gammage, vice president and Gartner fellow, in a statement. "Selected from across our research areas as the most compelling and critical predictions, the developments and topics they address this year focus on changes in the roles that technologies and IT organizations play: in the lives of workers, the performance of businesses and the wider world."

"With costs still under pressure, growth opportunities limited and the tolerance to bear risk low, IT faces increased levels of scrutiny from stakeholders both internal and external," added Darryl Plummer, managing vice president and Gartner fellow. "As organizations plan for the years ahead, our predictions focus on the impact this scrutiny will have on outcomes, operations, users and reporting. All parties expect greater transparency, and meeting this demand will require that IT become more tightly coupled to the levers of business control."

Among the other top Gartner prediction that will materialize by 2015 are that:

·         Information-smart businesses will increase recognized IT spending per head by 60 percent;

·         Tools and automation will eliminate 25 percent of labor hours associated with IT services;

·         20 percent of non-IT Global 500 companies will be cloud service providers;

·         10 percent of your online "friends" will be nonhuman; and

·         A G20 nation's critical infrastructure will be disrupted and damaged by online sabotage.

Gartner attributes the projected 60-percent increase in per-head IT spending to benefits from such recession-driven measures as consolidation, optimization and cost transparency programs that many IT-enabled enterprises that successfully navigated the recent recession and return to growth should enjoy.

In predicting a critical infrastructure disruption from sabotage within at least one G20 nation, Gartner notes that online attacks can be multimodal, in the sense of targeting multiple systems for maximum impact, such as the financial system, physical plant or mobile communications. Such a multimodal attack can have lasting effects beyond a temporary disruption, Gartner suggests, comparing them to the lasting repercussions of the Sept. 11 terrorist attacks in the U.S.

Additional details on the firm’s report "Gartner's Top Predictions for IT Organizations and Users, 2011 and Beyond: IT's Growing Transparency" are available from Gartner. Gammage and Plummer will host webinars on the Gartner predictions on Nov. 30 and Dec. 15.

 




Comments (2)
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1. 12-01-2010 13:28
 
It makes sense for CIO incentives to be based on increasing revenue for the company. Now if only we could limit CEOs to bonuses if their company's revenue and stock price were up year over year.
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Ellen Pearlman
2. 12-02-2010 22:12
 
This was very much a consideration during the dot com era when companies looked to their CIOs for direction in terms of how to leverage the Internet to create new business models.  
 
In more recent years I think it's fair to say CIOs have been under more pressure to find ways to leverage IT to trim costs.  
 
The prediction seems like a valid - and welcome direction - but will be dependent on the economic climate of the time.
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Mel Duvall

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