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By Mel Duvall
Business leaders are increasingly turning to chief information officers to lead initiatives that will transform their organizations, by speeding business processes, attracting customers, and developing new products and services, research firm Gartner found in a survey released this week.
Those big expectations are giving CIOs increased responsibilities and prominence in their organizations, but the spotlight could prove uncomfortable.
Many CIOs expressed uncertainty over whether they had the right personnel and technologies to deliver on those expectations.
In its annual CIO report, titled Making the Difference: The 2008 CIO agenda, Gartner found that 85% of CIOs are bracing for "significant change" over the next three years. Making the difference entails being able to innovate and roll out new offerings that will help organizations lead in the marketplace, not simply match the competition. That, in turn, means CIOs will need to become more tolerant of risk, both from a technological and cost standpoint.
It's a scenario that makes many CIOs uncomfortable. "The message is consistent across the survey: business leaders expect IT to make the difference rather than deliver generic IT solutions," said Mark McDonald group vice president and head of research for Gartner's executive programs. "This year, those expectations are beginning to outpace CIO confidence to deliver. This sharpens CIOs' concentration on IT capabilities like never before."
Gartner found that worldwide IT budgets are expected to increase by an average of 3.3% in 2008, up slightly from 2007. Improving business processes was the No. 1 business priority cited by those surveyed, followed by attracting and retaining new customers, and creating new products and services (innovation). Innovation was the biggest surprise in the survey, jumping into third spot from the 10th spot a year ago. It replaced reducing enterprise costs, which is now ranked 5th among business priorities.
Gartner surveyed some 1,450 enterprises in 33 countries, representing $132 billion in IT spending.
For the third year in a row business intelligence applications were cited as the No. 1 technology priority for 2008, followed by enterprise applications such as enterprise resource planning (ERP) and customer relationship management (CRM), and servers and storage technologies in third spot.
There was good news and bad news on the staffing front. CIO tenure has stabilized at an average of four years and four months, giving CIOs time to understand their businesses and work with executives to achieve goals. In addition, more than half of CIOs reported having responsibilities outside of traditional IT, reflecting enhanced roles in business leadership. The most common additional responsibility reported was related to business process improvement.
On the negative side, only 27% of CIOs believe they have the right number of skilled people to meet business needs, impacting both IT performance and IT's support of strategic enterprise goals.
"The skills of your people count," said McDonald. "Two-thirds of IT organizations that do not meet business expectations claim that skills are at the core of their performance issue."
Another highlight of the report is the rising importance of Web 2.0 technologies and social computing. Companies recognize that they are increasingly competing in a world with rich information and personal expression. "Web 2.0 and social computing provide tools to capture both and turn them into customer insight, engagement and retention," said McDonald.
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