CEOs are increasingly willing to release funds for CIO driven innovation, particularly for mobile developments and also for revenue generation projects, according to the CIO Survey 2012 from Harvey Nash, the recruitment and outsource services provider.
The global survey found that 56 per cent of CIOs are launching projects that make money for their organisations rather than saving money as the CEO’s priorities switch towards growth, emerging markets and new technologies. CIOs report they are seen as the key to unlocking potential growth that organisations have struggled to achieve since the banking crisis led to an economic downturn.
The Harvey Nash CIO Survey, one of the most authoritative surveys of CIO sentiment, found that globally 71 per cent of CIOs believe their organisation needs to “embrace new technology otherwise they will lose market share”. Mobile technology is cited by the survey respondents as the driver from both customers and CEOs. The research shows that 58 per cent of CIOs responding are actively developing mobile and tablet applications and 20 per cent are very active in development.
This rush to mobile is in turn giving CIOs a budget increase as 44 per cent reported that their budget had increased for 2012, an increase from 39 per cent last year. Not only are technology budgets increasing, the CIO is gaining overall control of their IT spend. Last year seven per cent had control over the majority of their spend, this has increased to 11 per cent in 2012.
Outsourcing demand will increase the survey by outsourcing and recruitment service provider Harvey Nash found. As budgets and demands increase for CIOs they will need to increase the level of development skills available to them with 46 per cent of the respondents saying this will drive an increase in outsourcing for their organisations. Data Centre and maintenance was the second driver for outsourcing according to 49 per cent of the respondents.
“There is a clear link between the higher value outsourced activity, like software development, and the skills shortage experienced by CIOs,” Harvey Nash says in its report. “...the CEO demand their teams prepare for growth, CIOs have to find the skilled resources to meet the demand from the business”.
Focusing on the UK, Harvey Nash found that 50 per cent of UK CIOs have international responsibility and that 68 per cent believe the role is becoming more strategic. The challenge is that 72 per cent of UK CIOs believe their organisations need to embrace technology and only 29 per cent believe the organisation is innovating through technology. But 44 per cent say that IT is fundamental to competitiveness which is above the global average. These figures could be because of the slant of the UK economy towards financial services, which Harvey Nash admitted dominated the UK responses.
Budget increases in the UK are healthy with 71 per cent reporting an increase or at least no cut and 37 per cent expect an increase. For the first time Harvey Nash broke out the findings from Scotland and found that Scottish CIOs are more confident than the rest of the UK that the right skill levels are available to them locally. Like their cross-border cousins 76 per cent believe the organisation needs to embrace technology. IT budgets are lower in Scotland, with 20 per cent having a budget of below $1m and 36 per cent of them expecting a budget cut. Perhaps the cuts are expected as 11 per cent of the Scottish respondents were from the public sector.