“CIOs and other technology leaders have led heroic work to help their companies stay in business during the pandemic,” said a recent report, Pilots, co-pilots, and engineers: Digital transformation insights from CIOs for CIOS. “The question now is where will the focus of CIOs and their organizations be in the future?” To shed light on this question, the professional services firm Genpact surveyed 500 CIOs and technology leaders in partnership with the MIT Sloan CIO Symposium and Babson College professor Tom Davenport. Their findings were presented at the 2021 MIT Digital Symposium.
“We found a surprising level of commonality in terms of the technologies on which they are focused, the infrastructure they are attempting to build, and their view of expanding responsibilities,” was the report’s overriding finding. “High proportions of CIOs, for example, are focused on artificial intelligence (AI) and advanced analytics, moving to the cloud, and architecture modernization. There is, however, a lack of consensus on a critical issue: the role of the CIO in business transformation.”
I’ve had a window into the evolution of the CIO role over the past decade through my involvement with the MIT CIO Symposium. In the past, the primary responsibility of many CIOs was operating their companies’ IT infrastructures while keeping costs down. Given their role, they often reported to the COO or the CFO. But increasingly, CIOs have been given responsibility for their companies’ overall digital strategy working closely with senior executives across the business.
“The role continues to evolve,” notes the Genpact report. “Almost all CIOs expect their roles to expand. Almost all report to or interact with the CEO regularly. And many are exploiting the cloud, advanced analytics, and automation. The big future bet that unites all CIOs is artificial intelligence (AI). And to access new talent and skill sets, many are exploiting their external ecosystem partners. All of which bodes well for the CIO’s future transformational activities. In addition to flexing their technology muscles, many CIOs are still building their transformation muscles, which must include strength in change management and business knowledge.”
Almost all (98%) of the surveyed CIOs agree that their responsibility will become more strategic in the coming years, including greater cross-functional collaboration (57%), driving business transformation (55%), and increased oversight over other technology-related functions currently not under the CIO role (53%). CIOs are increasingly expected to unite their company’s business and technology strategies. In addition to their traditional role managing IT operations and cybersecurity threats, CIOs are being asked to help deliver business growth through new digital products, to increase productivity through process automation, and to leverage technologies to improve both the customer (CX) and employee (EX) experience.
When asked which technologies they plan to prioritize to achieve these goals, AI and machine learning was mentioned by 48% of CIOs, followed by migrating data centers to the cloud (44%), digital commerce technologies (41%), re-platforming applications for the cloud (40%), process automation (40%), and CX/EX technologies (39%).
The survey revealed three distinct types of CIOs, depending on their level of influence on their firms’ digital transformation: pilots, 22% of CIOs, drive the overall transformation across core business functions; co-pilots, 61%, partner with business leaders to shape and deliver transformation; and engineers, 17%, execute but don’t drive transformation. Let me summarize each these CIO types.
Pilots. “The CIO’s role has always had multiple components, but in forward-thinking firms, it’s increasingly oriented toward leading business transformation through technology. At one time, most CIOs came up through the IT function, but now many come into the job with business backgrounds and appreciate the potential of technology to transform strategies, processes, and business models. This business knowledge – combined with regular CEO meetings – is helping transformation pilots succeed.”
Over the past several years I’ve been one of the judges that selects the winner in the annual MIT CIO Leadership Award. The finalists, - all of which are truly super-pilots, - have told us that they not only have to lead the creation of the digital strategy, but have to communicate their reasoning to their company’s CEO, senior business executives, and board members. The ability to unite and articulate the company’s business and technology strategies helps transformation pilots to consistently be out front in embracing key technology and market initiatives. As a result, 52% of pilot CIOs strongly agreed that their organization is well positioned for the growth of the company post-pandemic, compared to 43% of co-pilots and 36% of engineers.
Pilots have also been the most aggressive adopters of AI and automation technologies, with 45% having done so compared to 36% of co-pilots and 33% of engineers. Furthermore, transformation pilots have mastered their IT operations role, relying heavily on automation and ecosystem partners which enables them to focus their energies on the tasks that most require their attention.
Co-pilots. At 61%, co-pilots are the largest group of CIOs surveyed. While impactful, the co-pilot role is less visibly influential than the pilot’s. They do partner with business leaders to shape and implement transformational initiatives. But, compared to pilots, they often struggle to unite business and technology strategy and don’t have the same level of resources to explore emerging technologies and markets. “Co-pilots are well suited to the collaboration that digital transformation calls for - a skill CIOs at all levels must develop to drive change.”
Co-pilots are generally more focused on technology infrastructure issues than pilots but less so than engineers. They tend to be involved in increasing productivity through new service delivery models, like process automation and partnerships with technology providers. Co-pilots are out front in migrating data centers to the cloud and in re-platforming applications to run on the cloud. “While co-pilots are still busy with cloud migration, pilots have already made these investments and are ready to enhance their existing cloud footprints.”
Engineers. Keeping the business on course is the primary responsibility of engineers, the smallest group (17%) of CIOs surveyed. They exercise leadership on technology-related initiatives, while receiving direction from business leaders on the execution of transformation initiatives. “Indeed, this has been the primary role for CIOs since their role was defined in 1981. The engineer role, however, appears to be on the decline as CIOs expect more responsibilities for driving business transformation in the next couple of years.”
Engineers aren’t at the same level of digital maturity as their peers. Of the three types of CIOs, they’re the most likely to say that a lack of skilled talent is a barrier to transformation. To access the necessary skills, engineers often rely on external technology providers and service partners. 45% of engineers said that upskilling talent and migrating workloads to cloud-based infrastructures and applications were necessary to adapt to the changing business environment.
“Cloud is a priority for all CIOs. In fact, in the next 12 months, all respondents plan to continue or start their transition to the cloud. Unfortunately, engineers have a long cloud journey ahead of them. They are the least focused on migrating data centers to the cloud, building a development, security, operations, and governance infrastructure in the cloud, and building data lakes and analytics systems of insight in the cloud.”
“Talent-related issues appear in the top three of both external and internal challenges. When asked which skills and competencies will be most important to the success of the CIO organization, practicing agile development and delivery, managing partnerships with external ecosystems, and blending internal and external datasets to generate predictive intelligence came out on top.” These capabilities have been in high demand through the pandemic.
Finally, despite unprecedented investments in digital infrastructure and transformation, many of the surveyed CIOs have concerns about the future. “Only 44% agree strongly that their CIO organization is well positioned to support the company’s growth after the pandemic. … The sentiment is similarly concerning for business resilience in the face of future upheaval. In fact, 68% of CIOs believe their CIO organization is not completely prepared to help their companies withstand another major business disruption.” My chief takeaway from the report is that is that CIOs will have to play a major role to help their companies’s thrive in our increasingly digital economy.
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