Worldwide Survey Says CIOs Will Need to Replace ''Do More with Less'' with ''Make a Difference with What They Have''

A worldwide survey of some 1,400 CIOs by Gartner Executive Programs revealed that while CIOs are aware of the business priorities in 2007 -- and the need to improve processes, workforce performance and attract new customers -- near-term priorities remain internally focused on IT services. This disconnect, Gartner analysts warn, will place CIOs and IT at risk.

The report Creating Enterprise Leverage: The 2007 CIO Agenda says Gartner, represents CIOs with an average IT budget of $90 million, in all major industries and countries.

Surveyed Top Business Priorities include:

• Business process improvement
• Controlling enterprisewide operating costs
• Improve effectiveness of enterprise workforce
• Deploy new business capabilities to meet strategic goals.

Top Technology Priorities include:

• Business intelligence applications
• Enterprise applications such as ERP and CRM
• Legacy application modernization
• Networking voice and data applications
• Virtualization of servers and storage
• Security technologies
• Service-oriented architecture
• Document management
• Collaboration technologies.

Worldwide IT budgets are expected to increase by an average of 3 percent in 2007, up slightly from 2006 IT budget increases of 2.7 percent. Fifty-one percent of CIOs expect a planned IT budget increase. Thirty percent of CIOs report no change in their budget from 2006 to 2007, while 19 percent of CIOs report a planned IT budget decrease.

Sixty-three percent of CIOs report that in 2007 their enterprise expects to increase its market share or expand its mission in 2007. That is approximately double as many as in 2006. Business executives expect IT to raise current performance and build new capabilities. "Doing more with less - cutting IT costs will not realize these goals," McDonald said.

"CIOs will need to create enterprise leverage because the pace and scale of customer demands are overwhelming budget growth and traditional approaches to change," McDonald said. "CIOs can use leverage to focus their actions and create significant results for the enterprise and its strategies. The challenge is that CIOs must continue to strengthen the core of IT and create new sources of leverage by focusing on IT leverage points rather than brute force change programs."

CIOs can create enterprise leverage when a focused effort produces significant results for the enterprise and its strategy, said Gartner in a release. This means that CIOs need to exploit new approaches to transform the business. CIOs can draw on one or all the following sources of enterprise leverage:

• Technology -- Reducing enterprise cost structures, improving operational scale, or raising process performance through automation, integration and standardization. CIOs are delivering current services well, but 63 percent of CIOs do not have the right skills in the right amount.
• Agility -- Managing the speed, scale, cost and risk of change through applying change management disciplines -- managing the supply of change with the capacity for change.
• Information - Gaining the business insight and understanding required to act in a changing environment. Only 36 percent of CIOs believe that management is using the right information to run the business.
• Innovation -- Bringing new ideas to the market successfully by evolving current capabilities, implementing new capabilities and gaining market acceptance for those changes. Eighty-six percent of enterprises see innovation as critical to success, but only 26 percent of enterprises believe that their current innovation level is sufficient to achieve their strategy.