Top Five Strategic Priorities for CIOs

Top Five Strategic Priorities for CIOs: "Top Five Strategic Priorities for CIOs Print
Wednesday, 10 February 2010

By Laton McCartney

Every year, the Hackett Group, a global strategic advisory firm, polls IT leaders at major companies to identify their strategic priorities. For 2010, these priorities have largely have been framed by the impact of the recent economic crisis. According to Hackett, they clearly show the reality of both ongoing and permanent cutbacks in resources relative to the business demand for IT services.

In other words, CIOs are necessarily seeking to do less with more. And they're relying on a new service delivery model to do this, said IT advisory practice leader Honorio Padron. 'The big change is that the service delivery model has moved from a platform center to a service center,' Padron told CIOZone. Given that change, here are the top five strategic priorities based on Hackett's interviews with 300-plus companies.

Manage and Prioritize IT Demand

Some 91 percent of the companies surveyed cited the need to prioritize demand, plan capacity and manage their portfolio of services and initiatives. 'They need to have effective processes in place to do this,' said Padron. 'Even at this point, a lot of CIOs don't have processes in place.'

There's urgency to this issue, Padron explained, because last year companies cut personnel in areas such as finance and procurement. 'Now they're relying on IT to help perform many of the functions that were previously carried out by the people who were let go.'

Create Agile Service Delivery Model

The trick here is to provide flexible service delivery without bolstering cost. This allows for a swift ramping up, or down, of IT capacity with fluctuations in business demand. Some 82 percent of respondents cited this as a top five strategic issue.

Here, Padron said, there are two complementary tracks leading to agility: 'design' and 'run.' Design, he explained, is putting in agility solutions such as SaaS and virtualization that enable companies to be flexible. 'Run' effectively is operating the pay-as-you-go approach that provides organizations to only pay for the resources they need -- when they need them.

The other important element in achieving agility, said John Santucci, Hackett's global practice leader of IT transformation, is the ability to roll out solutions quickly. The investment banking and insurance industries, he noted, have been particularly effective in 'predicting how technology can help in their area and then adopting it quickly,' Santucci said. 'For example, the insurance industry was very quick to adopt the tablet (notebook computer) because it enabled agents to file claims and take orders electronically.'

Continue to Drive Out IT Cost

What else is new? According to Hackett, 64 percent listed this among the top five 2010 issues. Padron and Santucci describe this as an ongoing effort in which processes are refined or new processes are put in place, often first as pilot projects, in an effort to achieve cost-cutting metrics. The success of these projects must of course be measured not strictly in terms of cost reduction. Their impact on the business side must be factored in as well.

Retain Top Talent

OK, maybe the economy is still in the tank, but IT labor market conditions are improving. And guess what? Hackett says that the organizations that put the greatest stress on their IT staffs during the worst of the crisis are at the greatest risk of defections in its aftermath.

At the same, Padron said, 'CIOs are finding that the new generation of employees isn't planning typically to stay on the job for more than two or three years. They'll go on to do something else.'

How do you keep this new breed of computer game players, Facebookers and tweeters in the fold? Padron says that some major companies are now offering tech workers the flexibility to make personal tweets, check their Facebook accounts and even shop online while they're at work. This was listed as a top five issue by 64 percent of the companies surveyed.

Implement IT Portfolio Management

This isn't solely an IT concern. Today more and more companies are taking an enterprisewide, collaborative approach to evaluating and managing portfolios and implementing IT and other capacities, Padron and Santucci explained. As a consequence, what IT does, say, must be weighed in the context of marketing's priorities or HR's constraints.

Bottom line: A major IT initiative or change in the IT portfolio most likely will need to be reviewed by a C-level steering committee and be subjected to what Padron and Santucci described as different levels of approval. Seemingly, this might prove counterproductive in that flexibility and quick response would be hampered. This was also listed as a top five issue by 64 percent of the companies surveyed."