Irish IT functions focused on becoming strategic business partners and driving innovation
CIO Survey 2013
29 November 2013 - less than one quarter of Irish CIOs believe IT function is a hub of innovation.
- Lack of business facing IT skills a growing concern
- IT budget increases last year lower than predicted
- Irish companies leading the way on social media
- Irish CIOs benchmarked internationally for the first time
Four out of ten Irish CIOs consider themselves to be excellent business partners to the business according to the Deloitte CIO Survey 2013. However, in line with their international counterparts, the majority of Irish CIOs (61%) still consider themselves as fair or poor strategic business partners. Encouragingly, the findings do indicate an improvement on last year when just 17% of respondents rated IT/business alignment as excellent within their organisation.
The results of the survey clearly indicate the view that establishing a dedicated business partnering function gives the CIO the best chance of achieving excellence as a strategic partner. Here in Ireland, respondents in the financial services industry lead the way in terms of business partnering – 71% have a business partnering function, compared to less than 39% for other private and public sector organisations. This translates to increased effectiveness as 57% of CIOs operating in the financial services industry rate their business partnering teams as ‘excellent’, compared to 36% in other industries. Internationally, of those that rated their teams as ‘poor’, 88% did not have a business partnering function.
In terms of barriers to business partnering, a lack of business perception/understanding of IT was cited as the top barrier. This was followed by clarity on IT priorities and resourcing, and IT visibility and relationships outside the IT function. A dearth of experienced talent within the IT function who think like the business, who can think strategically and who can communicate effectively with the business was also seen as a major barrier.
These are some of the findings of the survey, now in its fifth year in Ireland. This year it has been carried out for the first time internationally across 36 countries with over 700 responses from Chief Information Officers and IT leaders to provide a useful benchmark for Irish CIOs with their international peers.
While technology-driven innovation is becoming a key driver of competitive advantage, Irish CIOs are not as emphatic as their international peers when asked on the importance of innovation as part of their organisation’s business strategy. Two thirds of global respondents indicated this was a key component of strategy, compared to 60% in Ireland. In terms of IT driving innovation, just under a quarter of Irish CIOs (24%) feel that their IT functions are hubs of innovative development. This compares with 35% globally.
Harry Goddard, Partner, Technology Integration, Deloitte commented:
“Business transformation today is both fundamentally driven by and reliant upon the fast changing world of technology. It is clear that Irish CIOs want to move from a service provider role to that of strategic partner to the business. While a clear majority of Irish CIOs (62%) understand how they can support innovation, the results show there is still more potential for them to do more in this regard. The business imperative is innovation, expansion and market differentiation. If IT does not support this transformation, then other areas of the business will step in.”
Further key findings of the survey include:
Encouragingly, while last year 84% of respondents who were recruiting indicated that there were insufficient numbers of appropriately skilled staff coming to the market, this has eased somewhat this year with only 65% indicating it as a problem.
Globally CIOs have identified that they are struggling to find the right blend of technology expertise and business skills to support the business. In Ireland, 63% of respondents indicated that the largest business skills gap was the ability of staff to think like the business. Consequently, one area of high priority for Irish CIOs is the development of existing IT staff and skills. 62% of respondents rated this as a top priority in Ireland compared to 48% globally.
IT budgets and priorities
Last year’s survey found that over 40% of Irish CIOs expected to see an increase in budgets for 2013, yet just 22% reported an increase in 2013. This compares with 36% of CIOs globally who have seen increases in the past year. In terms of budget priorities just over 60% of IT budgets are being allocated to ‘business as usual’ activities, with the remainder to support business growth and change. Irish CIOs, in line with their international counterparts, indicated that responding to new business needs is their primary focus, while developing IT staff is the next highest priority for Irish respondents.
Survey results also show that Irish CIOs are leading the way in terms of prioritising the re-structuring of operating models (25% versus 19% internationally), in addition to reconsidering how to source new capability from their external suppliers (11% versus 6% internationally).
Despite being identified as a key priority, results indicate that the adoption of emerging technologies such as mobile, the cloud and social media could be higher to drive innovation. Adoption rates currently stand at the following for Irish organisations:
- Social media – 48%
- Mobile apps – 48%
- Private cloud – 43%
- Public cloud – 31%
These rates show there is potential waiting to be unlocked; however it is encouraging to note that the Irish lead the way in terms of social media, which has been adopted by just 34% of global respondents’ organisations.
IT is viewed as offering a varied and fulfilling career as identified by 72% of Irish CIOs. At a global level while just over half (53%) stated they would like to remain in an IT leadership role, 27% view a COO role as their next career move, followed by a consulting role (25%) and a CEO role (22%).
“Irish IT leaders are clear of the role they wish to play in their organisations and there are many untapped opportunities lying ahead for them. Now is an opportune time to get as close as possible to the business strategy and demonstrate the value of IT. While there is still some way to go, the perception of IT is changing as more organisations realise the strategic importance of this function.”
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About the research
This is the fifth survey of CIOs and IT managers in Ireland carried out by Deloitte. This year, the survey was carried out on a global basis for the first time, incorporating over 700 responses from Chief Information Officers and IT leaders across 36 countries.