Under-pressure CIOs fret about their digital project skills
CIOs are feeling swamped by the digital initiatives piling up on top of traditional IT duties and fear they lack the skills to cope with that dual burden.
Just over half of IT leaders think demand from the business exceeds their capacity to manage digital projects, with four in 10 saying they are not cut out to face this future, according to Gartner.
There's a cultural tension between IT's desire to do things clearly and in a predictable way and the way you need to operate with digital projects, Gartner Fellow and vice president Dave Aron said.
"Traditional IT people like certainly and clarity and there's not a lot of that in the digital world," he said.
"What's happening now is CIOs have to continue to provide that really professional, solid core infrastructure but they also have to deal with their company's need to succeed in an increasingly digital world."
Analyst firm Gartner's survey of business priorities and CIO strategies, which was conducted in the final quarter of 2013, included 2,339 CIOs controlling a total of more than $300bn in IT budgets in 77 countries.
According to Aron, digitalisation is about radically reinventing your business to generate significantly more value using a broad set of information and technologies.
"In the past year or two, this need to be more digital — and even exactly what digital and digitalisation mean — it's catching a lot of CIOs on the hop, partly because they don't know what it is and partly because they are just so busy doing everything else," he said.
"Compared with normal IT, it's both broader and deeper. It's broader in that you're considering different types of technology and drivers — mobile, social, big data, cloud, sensor networks, consumer devices — the whole gamut of things normally way beyond what most IT organisations look at."
Aron said digital is deeper in the sense that most IT has been fundamentally about making existing business processes better.
"Digital is not about that at all. This is about changing your business models, changing your business strategy based on the digital possibilities and the digital threats," he said.
"It's not just about making your business more efficient and effective. It's about changing your business."
That contrast from conventional IT explains why digital project leaders need an additional set of skills, different governance mechanisms and the ability to work with a separate group of technology partners.
Unfortunately, the five types of skills that Gartner has identified as essential for digital initiatives are in short supply among existing managers as well as in the wider market.
The first area of essential skills is digital design, followed by data science and analytics, and digital anthropology.
"In the old days of IT you went into the computer's world. You went and sat at a terminal and did your thing with the computer, maybe you ran the payroll and left. Nowadays computers are deeply entwined in the way we live," Aron said.
"So there's a need to understand people, who they trust, how they consume information, tribal behaviours, to be really successful. That digital anthropology — the application of social anthropology to a digital world — is a very rare skill. Most people haven't heard of it."
The fourth skill area is the ability to work with startups and small businesses. Unlike conventional IT, where organisations gravitate towards the big-name companies, digital initiatives are best supported by smaller, more innovative firms.
"The problem is when a big company works with a small company it normally ends in tears. Either the small company gets all the innovation knocked out of it by the big company's bureaucracy or the big company kills the small company by not paying them on a fast enough schedule or forcing them to do things they're not good at," Aron said.
Finally, skills in agile project management and agile software development are an essential part of digital project work.
"All these skills are things the vast majority of organisations are lacking and very thin on the ground in general availability. They are not things that you can just poach," Aron said.
"There are big holes and you have to be innovative to address them, maybe partnering with universities, reverse mentoring, all kinds of techniques to develop these capabilities. It's not like hiring a Java programmer."
The Gartner report, Taming the digital dragon: The 2014 CIO agenda, also reveals that while IT budgets appear flat for this year, non-IT spending is rising, with a quarter of technology expenditure occurring outside the IT budget.
Aron said although IT budgets appear flat taken as an average, spending can vary hugely between individual organisations.
"There's massive variability in what's happening to budgets — more so than in previous years. Some companies are massively ramping up the IT budget and the budget outside IT and some are doing the opposite," he said.
"So more important than the actual figures is the notion that's it's getting more and more variable and that companies can't rely on doing IT the same as the next guy or even the next guy in the same industry."
Gartner also found that more than two-thirds of CIOs are going to overhaul their sourcing in the next two to three years.
"There's a real sense that innovation hasn't been coming from their traditional vendors and sourcing partners. They are going to change where and how they spend their dollars," Aron said.
"Part of it is just the natural cycle. A lot of them are coming to the end of the cycle and they're thinking the grass is always greener but part of it is a real sense that the big, well-known technology providers and sourcing partners are not providing enough innovation."
Nearly half of CIOs say they are already having to work with types of company with which they have never had dealings before — in mobile, for example.
"All the tech that's not in the IT group — factory networks, sensor networks, technology in cars — as those things merge you need completely different types of vendors and relationships. We would expect that to be an increasing trend," Aron said.
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