More C-level executives in Singapore, particularly chief marketing officers (CMOs), are having more influence in their companies' IT buying decisions at the expense of the CIO. Some firms have even started to create hybrid CxO roles between marketing and IT to meet these changes.
"It's not less of a say in the buying process per se, [but] it's a loss of control," said Drew Graham, director at Singapore-based consultancy firm eVantage Technology. He pointed out that IT departments traditionally abhor change and want to maintain the status quo.
However, the change of IT from the conventional model of centrally-purchased, centrally-managed and centrally-deployed to largely distributed, thanks to trends such as cloud computing and bring-your-own-device (BYOD), has been very rapid. This leaves the CIO removed from the process as end users and team managers start to make product selection and purchasing decisions, Graham noted.
"The reduction in influence in the buying process is largely because [CIOs] haven't moved quickly enough to stay relevant to the conversation," he added.
Digital marketing driving change
According to Gavin Tay, research director at Gartner, marketing organizations will source 80 percent of their technology needs externally and cutting out the middle man--in this case, the internal IT department--by 2016. This is because a significant part of Singapore's business landscape comprised multinational companies (MNCs), he added.
"As digital marketing and digital commerce take a strategic role in enabling growth, more advertising and search campaigns, brand measurement, analytics, social and mobile projects--and of course, Web sites--will be sourced externally," added Tay.
Digital marketing would then be considered a top priority on all Singapore CEO agendas, and this falls under the jurisdiction of the CMO, he explained. He added most marketing executives will have their own capital and expense budget for procuring digital marketing-related technology and technology-enabled services.
To facilitate the changing organizational needs and changes, enterprises have staffed the equivalent of a chief marketing technologist to report to the CMO, Tay said.
Implications on sales pitches
Benjamin Yang, CEO of Singapore-based Balanced Consultancy, noted the CMO is increasingly getting more involved in a company's investment decisions.
"Where in the past, a sales pitch might have been about productivity gains and supply chain optimization, these days, that conversation has expanded to increasing sales, consumer experience and even alignment to the company's branding for external-facing systems."
CEO, Balanced Consultancy
One factor has been the trend where consumer insights and big data are playing an increasingly pivotal role in allowing firms to establish their competitive advantage, he explained.
"Where in the past, an enterprise resource planning (ERP) system might sit in the domain of the CIO, these days, CMOs are more involved in sales management, product development and distribution channel management, all of which requires them to be involved in the IT buying process," said Yang.
He added the importance of digital and social media marketing also mean the CMO would need to partner the CIO in IT purchase and implementation.
The implication is that IT companies can no longer be content reaching out to the IT department of companies, noted Yang. "Instead, effort needs to be made to reach out to the marketing people as well as the CEO and other key decision makers of the organization.
"Where in the past, a sales pitch might have been about productivity gains and supply chain optimization, these days, that conversation has expanded to increasing sales, consumer experience and even alignment to the company's branding for external-facing systems," he said.
Agreeing, Graham said the changes have meant a rethink of how his consultancy firm communicated with customers in selling or designing solutions.
"Historically we only had to convince the CIO or technical people of a solution. It is now more a business than a technical sale, and the other stakeholders like the CMO or CEO combined, and sometimes individually, have greater sway than the CIO," he explained.
IT departments need to evolve
He added this was a crucial "inflection point" for IT departments to reinvent themselves from an innovation-stifling cost center to an innovation-leading productivity, and therefore profit, center.
"It is important for IT to leverage the growth in software-as-a-service (SaaS) and cloud technologies to become an enabler and a driving force for innovation in the company rather than the historical counterweight to change," said Graham.
For example, if companies restrict employees from external file access, people may end up installing virtual storage services such as Dropbox without approval. Companies should instead be proactive in offering similar solutions with enterprise-class level security such as Egnyte, which could be centrally controlled by IT, he suggested.