Five top priorities for CIOs in 2016

CIOs have many competing demands on their time, so it's important that focus on the big issues that really matter. ZDNet explores the research, speaks to the experts and discovers the five priority areas for CIOs through 2016.

1. Continuing to work on digital transformation

Transformation dominates the business agenda of modern CIOs. That trend has increased in prominence this year and Gartner's 2016 CIO Agenda Survey data shows that demands to build digital-first businesses continues to intensify. CIOs expect digital revenues to grow from 16 per cent to 37 per cent during the next five years.

The analyst says the deepening of digital means lines are becoming increasingly blurred and CIOs must participate in multiple networks of stakeholders. These ecosystems can include internal executives, external vendors and customers.

Take Chris Hewertson, CTO at glh, who has spent the last few years leading IT-enabled transformation at the hotel chain. He has drawn on cloud technology, agile development methodology and has been at the forefront of an organisational transformation that has put customer experience at the centre of the glh business plan.

"It's hard to see how transformation will ever stop," he says, reflecting the constant demand for change. "The technology's evolved since we've been doing our transformation. It's not like we've got 10 systems - we've got hundreds."

2. Using cloud to create an agile platform for change

Business leaders love the thought of agility. Organisations, however, cannot pivot and change direction quickly if the business is still wedded to a host of legacy and on-premise systems. A move to the cloud is an obvious step for many CIOs looking to help their firm embrace the digital transformation.

Yet there remains a huge amount of discussion about whether the cloud has reached a tipping point, especially given the number of CIOs who are yet to go on-demand but who plan to start sinking cash into cloud services.

A recent CIO survey by finance firm Barclays found 81 per cent of workloads were on-premise in 2014 and that figure is expected to decrease to 65 per cent during the next five years. Across the same time frame, public cloud workloads are expected to increase from five per cent to 17 per cent.

"Talk of the cloud is still very generic," says former CIO at ABN Amro Geert Ensing, who agrees the tipping point for cloud is still to be reached. "On-demand technology will be adopted more and more. Once you reach scale, external service provision can provide big benefits to the business."

3. Finding great talent to help IT meet business demands

External service provision is not the only way to run great IT projects. The bad news, says Gartner, is that lack of in-house talent is preventing CIOs from achieving their objectives. The analyst's research suggests 22 per cent of IT leaders believe the continuing skills gap is the key barrier to success.

The biggest talent gaps are around information - big data, analytics, and information management - followed by business knowledge and acumen. Worryingly, says Gartner, many of these gaps are the same ones CIOs cited four years ago.

Attracting talent is challenging enough. But in a highly competitive marketplace, experienced and capable employees can pick and choose from the best opportunities. Claranet CIO Andy Wilton says technical workers tend to move around every two to three years and that technology-focused companies face an annual attrition rate of 20 per cent.

IT leaders must dedicate time and resources in 2016 to shaping and moulding their technology team. To quote BCS director of professionalism Adam Thilthorpe: "You'd better start believing people are your best assets in the digital age - they are fundamental to your success."

4. Focusing on a personal return on investment

CIOs also need to focus on their individual development plans. The IT leadership role remains contested as CIOs face pressure from marketing and digital officers. Some IT chiefs are branching into other areas of leadership, taking responsibility for functions like product development, operations and innovation.

Yet there is still much more work to do. Consultant Deloitte says the majority of IT leaders suffer from a personal skills gap. The challenges are notable in three key areas: the ability to influence internal stakeholders; talent management; and technology vision and leadership.

These gaps will become increasingly important through 2016 as the role of technology leader continues to develop. Rather than being a steady climb, the IT professional career ladder is starting to look like a circuitous route, with those looking to make the heights expected to have wide business knowledge.

Mark Foulsham, global CIO of insurance specialist esure has moved beyond IT into other business functions during his career and he encourages other CIOs to think about their personal return on investment. "If you are delivering results, then it's fair to assume that you are an essential part of the business' success," he says.

5. Finding more time to spend on the exciting stuff

Modern CIOs are expected to dedicate more effort to innovation and less to operations. The problem, however, is that the business has never had more IT, and the clamour for new systems and services will not abate through 2016.

Deloitte's annual IT leadership survey suggests CIOs believe investments in analytics, business intelligence and digital will have the most significant impact during the next two years. At the same time, c-suite executives are expected to think beyond the present and to evaluate a broad range of leading edge technologies, such as robotics, artificial intelligence and the Internet of Things.

Gartner says 2016 will mark the start of a march towards algorithmic business. The analyst says relationships and interconnections will define future success. CIOs will need to focus on both building platforms to support algorithmic business and on introducing smart machines, such as wearables and sensors.

IT innovation, therefore, represents a significant challenge for CIOs. Bill Wilkins, CIO of energy specialist First Utility, says technology chiefs must proceed with care through 2016. "Take time to understand the business before you make decisions and be very open minded," he says.

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