Investments in digital technology are increasing, but how do you, as a CIO, ensure that the initiatives also succeed? With information from Gartner and McKinsey, we conclude what CIOs should focus on going forward to achieve goals and work ahead.
Lessons learned from the Gartner CIO Agenda 2023
In Gartner's annual survey, CIO Agenda 2023, over 2,000 CIOs and other CTOs in 81 countries across all types of industries participated. This year's survey focused on how CIOs ensure that tech investments produce the digital dividends the CEO expects.
Gartner's research shows that 80% of all CEOs are increasing investments in digital technology to meet the current challenging economic pressures, including high inflation and difficulties finding the right talent. Of course, as a CIO and other technology managers, you must set up a digital IT strategy. But despite many parallel digital initiatives, less than half of these live up to the CEO's expectations – for reasons such as the initiative taking too long to complete or realising value.
Read more: Additional insights for CIOs from previous years
Gartner recommends four actions CIOs should take to make tech investments pay digital dividends:
1. Prioritise the right digital technology investments
You must focus on whether the investments you make in digital solutions will provide the results the CEO expects. For example, can you expect a dividend during the period that the CEO expects? If your budget has been tightened, you may need to achieve results more quickly. Therefore, clarify what type of financial gain your CEO is looking for and prioritise investments that support that.
Digital tech investments often lag due to human factors and organisational issues such as poor behaviour, lack of talent, changing resistance, and competing priorities. Try to find a partner who shares your commitment to important investments. Or find a business leader who would make a good partner and work with them to find the right object to drive forward.
You need to prioritise and pick the solutions that are actually providing value. One thing to consider is reducing the number of business communication tools you use. Many companies find themselves adding more and more communication tools, but that doesn’t necessarily provide value and increase productivity. Determine what internal and external business communication tools are helping you get closer to your goal and eliminate the others.
2. Set up clear metrics
To assess your progress, setting up the right measuring points is essential. Ask your CFO which financial metrics should be improved through digitization – by how much – and over what period.
Many people in the company drive different initiatives that contribute to the bottom line and have other measures of success. Therefore, review how the various digital initiatives will affect the company's financial results. Ask the other leaders to define what they think is required for you to reach your common goal. Then set up clear measurement points highlighting these different initiatives and how they depend on each other to reach your goal.
Read more: 4 career tips for CIOs
3. Form fusion teams
When you find a digital initiative that can have a big impact and the opportunity to succeed, make sure that the right talent is connected to work on the initiative. Create a fusion team of subject matter specialists, business technologists, and IT staff. For example, product owners and domain experts can collaborate with scrum masters and developers. Fusion teams are great as they bring a business perspective to your internally focused initiatives and build business acumen in the IT teams.
4. Find external digital talents for everyday tasks
Finding the right talent is still a challenge. One way is to bring in talent from outside to work on internal, lower-priority projects. Using external talent can provide positive side-effects, such as distinctive thinking, diversity, equity, inclusion, as well as providing a pipeline of future hires.
There are many sources to use to find external talents. Most of the surveyed IT managers used shared industry resources such as Academia, industry-related research groups, and industry-specific consultants. Few CIOs choose to, for example, bring in students to help or collaborate with competitors in the industry.
The Gartner survey, CIO Agenda 2023, suggests students can require time in the form of supervision and training, but this means no or low costs for the company. Startups may be willing to develop things for you for free if they can keep the intellectual property.
Get inspired by CIOs worldwide in Forbes' annual article where they highlight 50 CIOs.
Succeeding with organisational work, according to McKinsey
A 2021 McKinsey study found that only 26 percent of organisational changes succeed. An important reason the changes are unsuccessful is when there is a loss of value, especially during and after implementation.
3 valuable measures for implemented changes to add value, according to McKinsey:
- Conduct a broad assessment of the business
Gather facts from a range of areas that identify opportunities for improvement. Set an overall financial goal. Remember that if companies set high expectations, people tend to meet them. - Align goals for all employees
People at all levels must understand what the set goals mean for their daily work and what they are expected to do differently. If you’re not clear in your communication, they will be sceptical. They want to understand the change and what it entails. - Match your best talent with high-priority initiatives
To create the most value, the people with the right experience and skills must be paired with the right initiatives to deliver the desired value.
And remember. Just like in a relationship, communication is the way forward. The same applies to your employees. Humans are creatures of habit, so if the change risks upsetting employees' routines, they become worried. It’s a concern that’s important to take seriously. The key to easing this anxiety and implementing change is clear communication. The success of your change work depends on your implementation.
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