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Gartner Executive Programs Survey Identifies Regional Differences Between CIOs
Research Highlights the Context, Opportunities and Challenges for CIOs in Different Geographies and Industries
Gartner's global survey of 2,339 CIOs showed that issues experienced by CIOs are far from universal and real differences exist at both a regional and country level. The worldwide survey was conducted in the fourth quarter of 2013, representing more than $300 billion in CIO IT budgets in 77 countries. The Gartner Executive Programs report "Taming the Digital Dragon: The 2014 CIO Agenda" represents the most comprehensive examination of CIO strategies and success behaviours.
Economic conditions vary considerably. For example, on average, global IT budgets are flat (0.2 per cent growth in 2013 to 2014, while CIOs in Latin America are looking at an average budget increase of 7.3 per cent. This is typically in line with macroeconomic conditions.
"The CIO survey results clearly show that as digital opportunities and threats pervade every aspect of business and government, the IT and digital agenda for each country, industry and enterprise is becoming more unique," said Dave Aron, vice president and Gartner Fellow. "The way businesses and public-sector agencies use information and digital technologies is getting more entwined with their economic, regulatory and competitive contexts, as well as with the state of their business and digital maturity. This is a function of every aspect of every business becoming digital - every process, every employee, every business leader, every customer, every interaction, every moment. Just as our businesses are unique, our digital footprints are becoming all the more unique."
CIOs in North America report an IT budget increase of 1.8 per cent for 2014. This means that North American CIOs may have more room to manoeuvre than their counterparts in EMEA, where the average IT budget is down 2.4 per cent.
Sixty-two per cent of CIOs in North America are expecting to change technology and sourcing strategies in the next two to three years; however, this is the lowest percentage in any of the major geographies. For example, 82 per cent of CIOs in China expect to change their technology and sourcing approach in the next two to three years.
"North American CIOs should be careful not to become complacent, and they should instead keep a constant focus on optimising their sourcing mix, especially to ensure there is enough innovation," Mr Aron said.
In the use of the cloud, North American CIOs have a slightly larger focus on agility than their global counterparts and a slightly larger use of software as a service, as opposed to infrastructure as a service or platform as a service. However, only 26 per cent of North American CIOs report they have made significant use of public cloud offerings, so the majority of North American CIOs still need to venture into significant public cloud usage.
CIOs in China reveal a higher business focus on growth and innovation, and a significantly higher IT budget increase of 13 per cent this year, way above the global average of 0.2 per cent. However, at least 45 per cent of IT spending is outside the IT organisation, compared with the global average of 26 percent. China appears bullish on digital and cloud, with 39 per cent of CIO respondents from businesses in China identifying a C-level digital leader (such as a chief digital officer (CDO)) in their business, versus 7 per cent globally.
Sixty-one per cent of Chinese CIOs report that they have made a significant investment in public cloud, versus 25 per cent globally.
UK and Ireland:
Globally, 25 per cent of CIOs have already made significant cloud investments. For Ireland and the UK, the move toward the cloud is even more aggressive than the global average. In the UK, for example, 28 per cent of CIOs report already making significant cloud investments.
Sixty-five per cent of CIO respondents in the UK and Ireland expect to increase their sourcing of IT in the near future. The desire to cut costs is traditionally one of the primary reasons behind this shift in sourcing strategy. However, there is also an increasing desire to achieve agility as well through partnerships with external service providers.
"With 78 per cent of CIOs expecting to change their sourcing approach in the next two to three years, a new set of capabilities will be required," said Mr Aron. "CIOs must be able to partner with a broader range of IT suppliers, not only the big vendors, and move beyond IT contracts that constrain their ability to innovate and adapt in response to changing business expectations. This change will be especially challenging for the public sector in the UK and Ireland, as the current rules and regulations favour large suppliers and long-term contracts."
Most companies in Latin America are confident that they should take advantage of digital economy opportunities. Another relevant trend is that 25 per cent of IT spend is outside of the IT budget (26 per cent globally). For Brazil, it has reached 34 per cent. This means that business areas are increasingly driving budget decisions associated to their products and related IT support.
The survey also reveals growing digital confidence among CIOs in the region. While 42 per cent of global CIO respondents think they don't have the IT skills and capabilities to meet digital challenges, in Latin America only 26 per cent of IT organisations think they are not ready to "tame the digital dragon."
More detailed analysis is available in the report "2014 CIO Agenda: Global Perspectives." This collection of 22 research documents leverages the 2014 Gartner CIO Agenda Survey in order to contextualise and clarify the behaviours and decisions facing CIOs in a diverse range of industries and geographies worldwide. The report is available on Gartner's web site at http://www.gartner.com/doc/2687817.
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