Deloitte CIO Survey: Pressure on IT departments to drive innovation mounting, yet CIOs not fully equipped to deliver

• Innovation is putting pressure on the IT departments of Swiss companies: Almost two-thirds of Swiss IT leaders interviewed in the Deloitte CIO Survey perceive a growing threat from innovative competitors. A large majority of CIOs recognise that a cautious approach to technology innovation is no longer appropriate.
• Companies are increasingly looking to IT to strategically and proactively propel technology-driven innovation. More than 80% of surveyed CIOs are planning a more systematic and formalised innovation framework.
• Yet CIOs still face various deep-rooted barriers within their organizations to develop the full innovation potential, the largest being a lack of time, low tolerance for failure and a lack of talent.
  

Swiss IT leaders must start into 2017 by vigorously driving innovation and adopting a more strategic role in their organizations. According to the latest Deloitte CIO Survey, 59% of CIOs surveyed in Switzerland state that the priorities for their IT organisation have clearly shifted. The demand within organizations for technology-enabled innovation is far higher than ever before.

Eleventh hour in the innovation process

Today’s CIOs clearly recognise that a cautious approach to technology innovation is no longer appropriate. 59% of Swiss CIOs state that they distinctly feel the growing threat from innovative competitors over the past two years, both domestic and foreign.

Organizations have finally started to fully grasp that they can only achieve their innovation potential by enabling technology-driven innovation. The role of the IT department and the CIO is thus shifting away from an implementation focus to a more proactive and strategic one. The business is clearly looking to IT to initiate innovation rather than just advise on or implement solutions, as the majority of the surveyed CIOs say.

“CIOs are being challenged to innovate as never before. The contemporary CIO and IT team must deliver innovative technologies that excite internal and external customers. Successful CIOs must also have the ability to bring innovation to the table proactively, responding to needs that customers have not yet clearly articulated, or even perceived”, commented Michael MacNicholas, Head of Technology Strategy at Deloitte in Switzerland. “This shift in expectations is a significant challenge for the CIO, whose existing teams and processes are often not ready for a world of proactive innovation.”

Barriers to innovation still deep rooted

There is a clear gap between the business expectations for IT departments and CIOs’ actual resources and strategic standing to deliver innovation. More than half of the surveyed CIOs (53%) of surveyed CIOs state that they have real difficulties to quickly develop innovative capabilities after years of cost and risk reduction.

The barriers to innovation are deeply rooted: Almost three-quarters (74%) of the CIOs say that the lack of time figures as the top hurdle for innovation. A low tolerance for failure (45%) and a lack of talent (45%) are two further often-named factors impeding innovation.

Enhanced structure and funding

More than 80% of CIOs respondents plan a more systematic and formalized framework to fulfil innovation requirements. Especially for repeatable processes which are linked to technology-based innovation, 57% of CIOs have already established a formalised innovation pipeline and process in their organisation; a large majority of 80% plan to have done so in two years’ time.

“Innovation can’t be left to chance. 65% of today’s organisations pursue an innovation strategy, and an additional 23% plan to do so in the next two years – which is a good sign,” said Michael MacNicholas. “So most organisations realise what they have to do to not fall behind, yet need to invest more vigorously in enabling technology-driven innovation and further strengthening their IT departments and the strategic CIO role. The next couple of years will be crucial to CIOs to drive internal change and build up their innovation capabilities. Because if they can’t deliver innovation – someone else will.”