CIOs have business on their minds

Tech leaders in Asia identify business management as key priority, ZDNet Asia survey finds. Analysts say credit crisis further drives transformation of CIO role.

Business management has become the number one priority of IT managers in the Asia-Pacific region, according to the ZDNet Asia IT Priorities 2008/09 survey.

The majority, or 16.6 percent, of respondents in the online poll highlighted issues around increasing profitability, reducing costs, and improving quality and efficiency as their top concerns.

Conducted online in August, the survey polled 722 IT decision makers across the region.

Companies that bind technology closely with their business management are also using technology to create a clear differentiation in the market.

Hemal Patel, Elitecore Technologies

Some 35.7 percent of respondents highlighted the five areas of management issues, covered in the survey, as key concerns--namely, business, IT, workplace and staffing, and infrastructure.

Management issues featured the strongest amongst respondents in Indonesia, where 48 percent considered these their top priority. China was the lowest, with only 14.3 percent of respondents highlight management issues as key concerns.

In addition, size was an issue. Management concerns featured highest--40.5 percent of respondents--among larger organizations, compared to 31.8 percent among small companies.

Springboard Research CEO Dane Anderson noted that for many businesses, the CIO's role is no longer just about managing the IT infrastructure and ensuring that e-mail and applications remain running smoothly.

"CIOs are now involved more strategically in the business and are communicating internally with line of business managers how technology can aid their businesses," Anderson told ZDNet Asia in an e-mail interview.

"They are doing this in the language of business--that is, technology is an enabler to the business goals--instead of in the language of IT, which is managing technology for technology's sake," he explained.

Elitecore Technologies CEO Hemal Patel said CIOs now recognize the need to be both outstanding technology managers and fully functional business leaders.

"To do this, they integrate and align IT roadmaps and business processes to gain competitive advantage and support the kind of growth that companies seek today," Patel said in an e-mail interview. India-based Elitecore provides unified threat management appliances, as well as billing and bandwidth management products for telcos and hotels.

According to Anderson, who is also Springboard's executive vice president of research, technology itself has reached a point where it helps to enable this transformation.

"SaaS (software as a service), Web-delivered applications, and the consumerization of IT are all helping to make business users get more comfortable with technology," he said. "In many ways, they can adopt these technologies on their own without the IT department's involvement, and this is helping to shift the conversation."

Agreeing, Patel said, technology has emerged as a strong driving force in business expansion.

"Companies that bind technology closely with their business management are also using technology to create a clear differentiation in the market," he said, citing Wal-Mart's "efficiency in logistics".

The U.S. retailer's early use of computers and scanners to track inventory, and its use of satellite communications to link the corporate headquarters with its network of stores, helped Wal-Mart gain competitive advantage "in a way no retail company has so far even dared to think of", Patel said.

Financial domino
In spite of the relatively good growth maintained by businesses in Asia, however, the slump in the U.S. economy has had its domino effect on this region, he noted.

The current economic climate is further redefining the role of CIOs to one where these IT leaders must focus on enabling their companies to more responsive not just to customers, but also to business and economic realities.

Patel explained: "If we take the two fastest-growing economies in Asia today, China and India, as references, businesses in these countries are trying not just to maintain their momentum, but are also focusing on deriving greater efficiencies and faster response to changes in a suddenly uncertain global economy."

Hence, CIOs are working with a twin mandate--that of continued business acceleration, while working toward maintaining lean business processes, he said.

Source: ZDNet Asia IT Priorities Survey 2008/09

"The current economic climate has further emphasized the challenge of utilizing business intelligence and technology at a granular level, enabling greater business knowledge and its application on the ground," he added. "Companies also find themselves needing to make rapid changes, and reorganize staff and resources during tough economic times as these."

Anderson said the current financial crisis will continue to drive such changes.

"As businesses have to deal with uncertainty and the potential of lower revenues, they look to IT for ways to help them sustain and grow their business," he said. "[They want IT to support] easier and more effective ways to gain information on the business, better collaboration, more effective interaction with customers, as well as provide a competitive advantage."

During the crisis, Anderson expects to see many IT leaders looking to leverage more of what they have and utilizing lower-cost products to meet their business need, which "will definitely be very business driven".

"IT has changed a lot since the last big crisis," he explained. "Then, it was IT leaders trying to get a return on the large, expensive applications and infrastructure that they put in place in the run up to the dotcom bust."

"Now you will see IT leaders leveraging the lower cost, Web-based solutions out on the market to solve specific business problems, or developing tools that can be cheaply and rapidly developed," he said.

"Big-ticket items will melt away during a crisis, but CIOs will still probably be able to find budget for SaaS applications with no upfront cost, paid on a monthly basis, and can solve a specific business problem," he added.

While such activity demonstrates that companies now realize technology's role is primarily that of a business enabler, Anderson said such sentiment has not yet reached all levels of the economy.

"The more forward-looking companies, or companies with forward thinking CIOs and IT leadership, are definitely thinking in this way and seeing real gains from this approach," he said. "However, there are still companies where IT is just a function, does not have a leadership role, and is called upon only when the leadership team needs them," he said.

These companies will not reap the rewards that a more business-focused IT strategy can provide, Anderson said.

Conversely, Patel added that the strongest players are companies where their leader clearly drives or supports the way technology is used to enhance the business.


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