Special Feature
Part of a ZDNet Special Feature: Tech Budgets 2022: A CXO's Guide

The CIO's next priority: Using the tech budget for growth

Tech chiefs are getting a new set of priorities from execs who now understand the power of digital transformation.

IT leadership: Influential CIOs deliver emerging tech for the business

CIOs have got the attention of the boss: tech analyst Gartner says boards and CEOs are now much more willing to invest in technology that has a clear tie to business outcomes. The analyst says global IT spending will total $4.2 trillion in 2021, an increase of 8.6% from 2020. Digital business projects with a short time-to-value will get the most money and board-level attention.

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This potential injection of cash means CIOs will have to shift their focus, too. Rather than concentrating on infrastructure concerns, the role of CIOs in the post-COVID age will be to help the board take advantage of its new interest in IT and to identify how digital and data can help the organisation grow.

"My sense is that the CIO role was in the past much more of a technologist focused on infrastructure, security, and basically providing cost-effective technology," says Nitin Chaturvedi, chief digital and technology officer at KFC Global.

"I think the future of that role is going to be much more around growth-oriented technologies and more about the digital product view. It's going to be much more of a change agent throughout the organisation -- not just the recipient."

SEE: What is a CIO? Everything you need to know about the Chief Information Officer explained

CIOs have built solid digital foundations for their organisations. Gartner says business leaders like what they're seeing and are making higher-value, more strategic IT requests that will support future growth. The analyst says this trend shows that the better CIOs perform for the business, the more the business asks of them.

The message for CIOs is clear: now, more than ever before, is the time to start taking about the power of technology. However, although the board is interested in technology, IT leaders must be careful not to bamboozle their business counterparts with chat about bits and bytes.

The reason, says Michael Voegele, who is chief digital and information officer at tobacco company Philip Morris International (PMI), is that business leaders don't always want to hear about the technical details of systems or services. Instead, they want to hear about the value that technological innovation can bring in terms of business outcomes.

"If you want to be part of the business, if you want to be an equal partner in driving the transformation of the business, you can't just default back to your technology expertise in those conversations at board level. You have to have a business point of view that you bring in," says Voegele.

So whether it's raising revenues, improving customer services or improving supply chain efficiencies, technology has to tell the story of how it enables a significant business-focused goal.

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That's certainly the situation at PMI, where Voegele focuses on demonstrating the potential benefits of digital transformation to the business. As a result, his IT team has shifted how technology is perceived by other business functions and by members of the executive team.

Voegele is far from alone in choosing to focus on pounds and pence rather than bits and bytes. Since joining Shakespeare Martineau in March 2018, IT director Dal Virdi has overseen a streamlining and refreshing of the law firm's IT infrastructure, including the implementation of a Nutanix hyperconverged infrastructure platform.

Now he's looking to push further digital transformation -- and in all business cases, he focuses on potential benefits. "When I have to go to the board or talk to my bosses, they want to understand technology in almost a paint-by-numbers way," he says. 

So rather than talking tech, successful CIOs use the board's new-found interest in digital transformation to whet the appetite for further IT-led change.

That's what their bosses want, too: consultant McKinsey reports that executives want CIOs to move beyond simply managing IT to using technology to create value for the business.

For now, much of that work will remain rooted in the digital foundations. The technologies that will underpin further transformation are familiar -- Gartner points to big investments in the coming year in devices (13.9%), enterprise software (13.2%), and IT services (9.8%).

Beyond the mainstream

For all the industry hype about emerging technologies, such as IoT, virtual reality and artificial intelligence (AI), the foundations for ongoing digital transformation are likely to be a lot more mundane for now. However that doesn't mean that tech concepts that are still far from mainstream adoption -- like quantum computing -- can be ignored.

SEE: What is quantum computing? Everything you need to know about the strange world of quantum computers

CIOs should be able to explain to the board how they will look to build on their digital foundations, such as the cloud services they've been busy honing and perfecting. They should explore partnerships with pioneering vendors and investigate projects and proof of concepts that show how emerging tech can be exploited.

Take Williams F1 CIO Graeme Hackland, who says quantum is a really exciting opportunity to take computation to a whole new level. If his team can get in there early before others, then they'll have a competitive advantage -- and he envisages big developments in quantum during the next couple of years.

Expect similar advances in other emerging areas, too. Gartner is already warning CIOs who are looking to continue their digital transformation efforts to focus on building technologies and services that don't yet exist.

Emerging technologies like AI and quantum computing might not be in your wheelhouse right now, but they soon will be. If you don't start exploring and speak up quickly, the opportunity to get ahead might pass you by.

CIOs have shown how central tech is to business in the past 18 months. Now they need to cement that relationship -- and that means showcasing the benefits of innovative digital and data services in a way that all executives can easily understand, says Shakespeare Martineau's Virdi, .

"From a CIO perspective, you need to have that intrinsic knowledge of what the tech means and whether it can deliver the outcomes that you're trying to get to. But to help the business understand the value of what the tech is going to deliver to the firm, you have to make it as simple as possible."