Even in an economic downturn, it’s still a good time to be chief information officer. A new report from research firm Foundry notes that 77% of CIO respondents say their role was actually elevated due to the current state of the economy, and this visibility across the organization is expected to continue.
In addition, 38% of industry respondents view the CIO as a strategic advisor, proactively identifying business needs and opportunities, and 25% view the CIO as a consultant who evaluates and advises on business needs and technology choices.
“CIOs are balancing the continued focus on transformation and modernization with a mature leadership role, embracing responsibilities beyond the traditional IT realm, and cementing their status as a valued and strategic partner to the business,” the report states.
The 2023 State of the CIO report, which surveyed 837 IT leaders and 201 industry participants, found that functional and transformational activities consumed the majority of IT leaders’ time this year, similar to 2022. of those surveyed (38%) considered themselves transformational CIOs, while 26% said they were strategic and 36% identified as functional, according to the report.
CIO role evolves with business needs
The focus on IT transformation “has not diluted the demand for CIO leadership, but rather increased their stature as a strategic advisor and source of advice,” according to the Foundry report. More than half of respondents (55%) said they proactively identify business opportunities and make recommendations regarding technology and provider selections, while 23% said they evaluate and advise on business needs, technology choices and providers.
Less than 10% said they act as a risk assessor or an autonomous player when it comes to technology purchase decisions. LOB respondents were pretty much on par with that assessment of the CIO role: 38% view the top IT executive as a strategic advisor and 25% as a valued consultant, according to the report.
The CIO job continues to focus more on digitization and innovation – a trend cited by 85% of IT leaders and nearly three-quarters (74%) of LOB respondents involved in this year’s survey.
Organizations have begun to view the CIO role through the lens of a changemaker, as cited by 85% of IT leaders this year. One notable finding was that the majority of LOB respondents recognize the transformative capacity of CIOs, but at 64%, the numbers are significantly lower than how technology leaders shape their own contributions.
In terms of executive status, CIOs increasingly report to the CEO (49%). This figure was higher among IT leaders in the financial services (56%) and high-tech (54%) sectors, as well as SMBs (57%).
Tech initiatives drive IT investments
The technology initiatives expected to drive the most IT investment by 2023 are:
- Security and risk management.
- Data and business analytics.
- Modernization of applications and legacy systems.
- Machine learning and AI.
- Customer experience technologies.
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The transformational aspects of the CIO role continued to take center stage, with 83% of IT leaders devoting their time to these types of initiatives. Modernizing infrastructure and applications remains a top priority, albeit less so this year (35%) compared to the 40% reported in the 2022 State of the CIO survey, the report said.
As last year, CIOs were focused on aligning IT initiatives with business objectives (38%), cultivating IT-business collaboration (31%) and driving change efforts (28%). noted the Foundry report.
The CIO as a business strategist
CIOs continue to take on responsibilities beyond the IT realm, especially creating new revenue-generating initiatives. Sixty-eight percent of IT leaders confirmed they currently have some sort of revenue responsibility, up from 65% in the 2022 State of CIO survey. This is much higher among IT leaders in high-tech (88%) and financial services (75% ).
About 44% percent of IT leaders lead a team charged with creating new revenue-generating capabilities, while another 24% are part of such a team. To make their organizations more revenue-driven, CIOs are automating business and IT processes (47%), creating new products and services (40%), and making data more accessible (34%).
Conversely, the report also notes that “this was another year where IT leaders were able to spend less time on corporate strategists’ responsibilities (61%), which was about the same as in 2022.”
The only exceptions were in the high-tech sector (78%) and financial services (67%), where IT leaders cited activities such as driving business innovation, developing and refining business strategies and identifying opportunities for competitive business goals (38% ), cultivating collaboration between IT and business (31%), and leading change efforts (28%). This all points to the maturing leadership status of IT managers, according to the Foundry report.
As in previous years, IT leaders continue to struggle to strike a balance between business innovation and operational excellence – a balancing act highlighted by 74% of respondents, especially in manufacturing (80%), retail (80%), the government (78%) and business organizations (77%). Finding a balance seems to be the ultimate goal.
“Looking forward, the pendulum will swing back toward CIO involvement in corporate strategists’ activities,” the report said. “Nearly three-quarters (71%) of respondents to this year’s survey expect to spend more time working as a corporate strategist three years later. They plan to focus on driving business innovation, developing and refining business strategies, identifying competitive differentiation opportunities and developing new go-to-market strategies and technologies.”