14 th CIO Workshop July 27th, 2001 CEO IT Survey Findings.

14th CIO Workshop

July 27th, 2001

CEO IT Survey Findings

2 © Accenture 2001

The CEO IT Survey

The Singapore Tribe Has Spoken

What Other Tribes Had Said

Agenda

3 © Accenture 2001

The CEO IT Survey Objectives Survey Administration Survey Demographics



Agenda

4 © Accenture 2001

The CEO IT Survey centers on the CIO Role and IT PracticesThe CEO IT Survey centers on the CIO Role and IT Practices

Objectives

To assessassess the organizational status of CIOs

To surveysurvey CEOs’ views on the roles of CIOs

To examineexamine the desired profiles of CIOs

To identifyidentify emerging IT Management Practices

Key ObjectivesKey Objectives

5 © Accenture 2001

The survey was conducted for a period of approximately two monthsThe survey was conducted for a period of approximately two months

Survey Administration

Start Date: June 1June 1stst

End Date: July 25July 25thth

Survey Sample: 80 CEOs in Singapore80 CEOs in Singapore

Responses Received: 3131

Response Rate: 39%39%

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6 © Accenture 2001

In all, 13 industries were represented in the survey sample… In all, 13 industries were represented in the survey sample…

Survey Demographics

26%

Number of Companies % of TotalIndustry

Electronics & High Tech

Manufacturing

Transport

Financial & Business Services

Government

Telecommunications

Commerce

Others

Energy

Health Care

Construction

Media & Entertainment

Social & Hospitality Services

Total

8

13%

13%

10%

10%

10%

6%

6%

3%

0%

0%

0%

4

4

3

3

3

2

2

1

1

0

0

0

31 100%

3%

7 © Accenture 2001

… which included organizations of various types… which included organizations of various types

Survey Demographics

Corporate Profile of Survey Respondents

SME

23.5%

Large Domestic Enterprise

10%

Local MNC

16.5%

Foreign MNC

10%

Statutory Board/ Government Body

36.5%

Others

3.5%

8 © Accenture 2001

The CEO IT Survey


Key Findings The CIO Status The Role of the CIO The CIO Profile IT Management Practices


9 © Accenture 2001

While our survey echoed certain findings of past research, it also presented interesting new findingsWhile our survey echoed certain findings of past research, it also presented interesting new findings

Survey Response & FindingsKey Findings

Key Survey Findings

CIO Status – There is a significant elevation of the CIO status, signifying the strategic importance of IT as a corporate function

CIO Role – In addition to the CIO’s role as a technology advocate, he/she has been asked to wear two other hats: those of ‘strategy maker’ and ‘external relationship builder’

CIO Profile – Most CIOs were hired externally, with their selection (by CEOs) based overwhelmingly on their strong business orientation and good organizational skills

IT Management Practices – The majority of organizations has outsourced a part of their IT functions, and expresses a general satisfaction of the services received

10 © Accenture 2001

Survey Response & FindingsThe CIO Status

In evaluating the general standing of CIOs in their organizations, we posed CEOs with the following questionsIn evaluating the general standing of CIOs in their organizations, we posed CEOs with the following questions

Q. Do you agree that the CIO should Q. Do you agree that the CIO should report directlyreport directly to the CEO as a to the CEO as a member of the senior team?member of the senior team?

No. of Survey Respondents

0

0

2

7

22

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

Q. Which of the following Q. Which of the following designationsdesignations apply to the CIO equivalent executive apply to the CIO equivalent executive in your organization?in your organization?

19

0

1

5

6

0 5 10 15 20 25

Chief Information Officer

Chief Innovation Officer

Chief Knowledge Officer

Chief Technology Officer

Director of Information Syst.



The survey results indicate that the status of the CIO is rising with a larger group reporting to the CEO as a member of the senior team

The survey results indicate that the status of the CIO is rising with a larger group reporting to the CEO as a member of the senior team


* Source: CSC Index Research and Advisory Services, Foundation Report 109 New IS Leaders, 1997

**Survey Results: ‘Do you agree that the CIO should report directly to the CEO?’- ‘Strongly Agree’ responses

Where CIOs Reported To (1997)*

Others

21%

CFO

23%

CEO33%

COO

23%

Where CIOs Should Report To (2001)**

CEO

71%

Others

29%


CIOs today are more influential as they enjoy a more visible executive role CIOs today are more influential as they enjoy a more visible executive role


Survey Findings

CIOs report to the Chief Executive – There is a visible trend in CIOs reporting to the CEO or COO rather than to the CFO- the tradition

CIOs are a part of the senior executive team – More CIOs are either on the board or on the executive committee at their respective organizations

Stronger support for CIOs – Most CIOs now receive much stronger support from top management regarding corporate IT standards, enterprise-wide systems, and centralized IT policy making


The majority of CIO equivalent job roles have also adopted the designation of ‘Chief Information Officer’…The majority of CIO equivalent job roles have also adopted the designation of ‘Chief Information Officer’…


CIO Equivalent Job Designations

61.5%

16%

19.5%

Director of Information

Systems

Chief Information

Officer

Chief Technology

Officer

Others

3%

In place of a CIO, some organizations have a senior executive with overall responsibility for IT and other operational activities

It is also common for a Senior VP of Technology, and in some cases, the COO to perform the role of the CIO

Other CIO Function Other CIO Function AlternativesAlternatives


… though other designations have surfaced with the increased responsibilities associated with the CIO role… though other designations have surfaced with the increased responsibilities associated with the CIO role


Survey Findings

CIOs as ‘change agents’ – In other research* conducted, it was found that some CIOs are called Directors of Process Change. This designation is applied to some of them who have acquired change-related responsibilities such as overseeing the human resource function

CIOs as ‘strategic planners’– As the business role of the CIO expands, a few have had ‘strategy’ in their title

* Source: Harvard Business Review, Mar-Apr 2000, ‘Are CIOs Obsolete?’, Michael J. Earl


We asked CEOs how they perceive the role of their CIOsWe asked CEOs how they perceive the role of their CIOs

Survey Response & FindingsThe Role of the CIO

Q. What should be the responsibilities Q. What should be the responsibilities of the CIO?of the CIO?


84%

84%

94%

6%

81%

0 5 10 15 20 25

Technology Direction Setting

System and App. Dev.

Information Management

Knowledge Management

Others

Disagree

Q. Do you agree that the CIO should play a Q. Do you agree that the CIO should play a role in the formulation of role in the formulation of business business strategystrategy??


0%

0%

3%

39%

58%

0 3 6 9 12 15 18

Strongly Disagree

Neutral

Agree

Strongly Agree

30


Although most CEOs expect their CIO to be a technology evaluator, they believe that he or she should also have operational and corporate planning responsibilities

Although most CEOs expect their CIO to be a technology evaluator, they believe that he or she should also have operational and corporate planning responsibilities

* Source: Accenture, Series on IT Management & Delivery (SITE), March 2000


Survey Findings

Traditional Job Responsibilities Remain Intact – Data center operations, network uptime, help-desk service, and systems development are still the CIO’s job

CIO Job Time Allocation – From a previous study conducted by Accenture *, the typical CIO allocates his time as follows:

Technological Issues - 40%

IT Professional and the IS Organization - 30%

Business issues - 30%

CIOs play a part in Corporate Strategizing – Our survey results demonstrate that CIOs should have formal responsibilities for business strategy


We also obtained the views of CEOs on whether the demands placed on CIOs have changed over the past 3-5 years

We also obtained the views of CEOs on whether the demands placed on CIOs have changed over the past 3-5 years

Q. Do you agree that the CIO’s technical Q. Do you agree that the CIO’s technical planning responsibilities have expanded planning responsibilities have expanded to include strategic planning?to include strategic planning?

Q. Do you agree that CIOs should have Q. Do you agree that CIOs should have business and financial skills in business and financial skills in addition to technical expertise?addition to technical expertise?


Survey Respondents (%)

Q. Do you agree that the CIO’s role has expanded to provide Q. Do you agree that the CIO’s role has expanded to provide external customer support and communications?external customer support and communications?

Yes

84%

No16%

71%

29%

Yes

No

74%

26%

Yes

No





Survey Findings

The CIO role now requires an enlarged set of knowledge, skills and abilities – to include business principles and techniques of administration, organization, and management

CIOs are now an integral part of Merger and Venture Formation Committees – Two CEOs cited the important role their CIOs played in their organizations’ launch of new ventures or M&A activities.

CIOs have external roles – CIOs are becoming involved in official roles beyond their departments and organizations. In their role as technical advisor to customers, they act as a bridge between engineers and senior management of both organizations

It is evident from the CEOs’ responses that CIO roles have expanded considerably as technology becomes a corporate enabler

It is evident from the CEOs’ responses that CIO roles have expanded considerably as technology becomes a corporate enabler


Survey Response & FindingsThe CIO Profile

Q. Which of the following profiles best suggests your Q. Which of the following profiles best suggests your CIO’s CIO’s employment historyemployment history??

With respect to the recruitment of CIOs, CEOs are four times as likely to hire a candidate with a career track in IS than to hire one without

With respect to the recruitment of CIOs, CEOs are four times as likely to hire a candidate with a career track in IS than to hire one without


0%

54%

21%

25%

0 2 4 6 8 10 12

External Hire/ With Non-IS Background

External Hire/ With IS Background

Internal Promote/ With Non-IS Background

Internal Promote/ With IS Background

14 16



CEOs were asked to rate the relative importance of several attributes they might consider a CIO to possessCEOs were asked to rate the relative importance of several attributes they might consider a CIO to possess

Q. A CIO should have the ability to Q. A CIO should have the ability to implement implement goals that focus on IT goals that focus on IT efficiencyefficiency

Q. A CIO should have a firm Q. A CIO should have a firm understanding of key IT issues and understanding of key IT issues and technologiestechnologies


0%

0%

0%

29%

71%

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

Strongly Disagree


0%

3%

0%

36%

61%

0 4 8 12 16 20 24

Disagree

Neutral

Agree

Strongly Agree



Q. A CIO should have an understanding of Q. A CIO should have an understanding of business issues and the business issues and the alignmentalignment of IT of IT activities to business objectivesactivities to business objectives

Q. A CIO should have a Q. A CIO should have a visionvision of what of what IT needs to do and its purpose IT needs to do and its purpose within the enterprisewithin the enterprise


0%

0%

0%

26%

74%

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree


0%

0%

0%

29%

71%

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

(continued)(continued)



Survey Findings

CIOs must maintain an appropriate level of technical competence – Though there is an increasing bias toward business proficiency, CIOs would need to keep abreast of IT developments to deliver the required IT functionalities

CIOs must position IT strategically – aligning IT and corporate goals are fundamental to IT delivering value to the organization

The results show that apart from possessing an understanding of technology, a CIO should be able to implement the organization’s IT vision, and align it to corporate objectives

The results show that apart from possessing an understanding of technology, a CIO should be able to implement the organization’s IT vision, and align it to corporate objectives


In surveying the current IT scene, we found CEOs to be very involved in IT spending issues. This could be expected as IT budgets have increased rapidly in most companies

In surveying the current IT scene, we found CEOs to be very involved in IT spending issues. This could be expected as IT budgets have increased rapidly in most companies

Survey Response & FindingsIT Management Practices

Q. Should the CEO participate in key IT Q. Should the CEO participate in key IT decision-making?decision-making?


Yes

86%

No14%

Q. Has your enterprise’s rate of IT spending Q. Has your enterprise’s rate of IT spending accelerated over the past 3-5 years?accelerated over the past 3-5 years?


Yes

93%

No7%



Q. Do you agree that IT initiatives are Q. Do you agree that IT initiatives are within within budget controlbudget control??

Q. Do you agree that IT initiatives are Q. Do you agree that IT initiatives are allocated allocated sufficientsufficient budgets? budgets?


0%

7%

14%

62%

17%

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree


0%

3%

59%

24%

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

The survey results indicate that IT Management and Delivery at most organizations have met their CEOs’ expectationsThe survey results indicate that IT Management and Delivery at most organizations have met their CEOs’ expectations

14%



Q. Do you agree that IT initiatives are Q. Do you agree that IT initiatives are generally able to generally able to deliver clear deliver clear valuevalue??

Q. Do you agree that IT initiatives are Q. Do you agree that IT initiatives are completed in a completed in a timelytimely fashion? fashion?


0%

17%

52%

14%

0 4 8 12 16 20 24

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

Strongly Disagree


0%

0%

21%

48%

31%

0 4 8 12 16 20 24

Disagree

Neutral

Agree

Strongly Agree

(continued)(continued)

17%


On IT outsourcing, we surveyed the extent of IT functions that companies have outsourced…On IT outsourcing, we surveyed the extent of IT functions that companies have outsourced…

Q. Which of the following IT functions does your enterprise Q. Which of the following IT functions does your enterprise contract out?contract out?


No. Survey Respondents

21%

76%

59%

0 4 8 12 16 20 24

Does not Outsource

E-Commerce App. Dev.

General App. Dev.

Data Center Operations

72%


… and found CEOs to be generally satisfied with the service received in contracting out these functions … and found CEOs to be generally satisfied with the service received in contracting out these functions


Q. Please rate your overall satisfaction of contracting Q. Please rate your overall satisfaction of contracting out the relevant IT function?out the relevant IT function?

0% 10% 20% 30% 40% 50% 60%

Very HighVery High

HighHigh

NeutralNeutral

LowLow

Very LowVery LowE-Commerce App. Dev.

General App. Dev.

Data Center Operations


The CEO IT Survey



Agenda


What attributes work?What attributes work?

First, let’s discount the obvious

No correlation between type of business and the CIO’s success

No correlation between CIO’s background and the targeted company’s industry

There does seem to be a correlation between understanding key IT issues and success

Secondly, the CIO must have a vision of what needs to be done

What is the purpose of IT within the enterprise?

Focus is broadly visible -- both within IT and within the business Thirdly, the CIO must translate the vision into action

Able to bold goals matched with practical short term moves

Focus on long term IT effectiveness

Focus on short term IT efficiency

CIO Success Factors


What attributes work (continued)?What attributes work (continued)?

Fourth, the CIO must have a Focus on Customer Value

Seek to deliver differentiated services that customers find valuable

Propose options which deliver value externally driving top-line growth

Use external services where value cannot be delivered internally Finally, the CIO must align IT’s activities in an organic manner

Understand the big picture

Develop the trust of the executive team

CIO Success Factors


Elements of the CIO’s Job DescriptionElements of the CIO’s Job Description

Reporting Relationship Trend is away from the CFO and/or COO reporting relationship Trend is towards reporting to the CEO as a peer of the senior team

Status and Scope Plays major role in IT Governance (e.g., Chairs IT Steering

Committee) Interacts with senior leadership to ensure alignment of IT activities All IT activities of consequence have a solid or dotted line to the CIO CIO is responsible for managing major vendor relationships IT Planning and Strategy is a major element of the CIO’s ongoing role IT Infrastructure reports to the CIO

Essential Functions IT Leadership

— Focuses proactively on emerging business initiatives— Develops relationships with customers to better understand needs

What Does a CIO’s Job Look Like?


Elements of the CIO’s Job Description (Continued)Elements of the CIO’s Job Description (Continued)

Essential Functions (Continued) Leadership (Continued)

— Develops broad range of relationships to ensure sponsorship of IT initiatives

— Fosters innovations and risk management in evaluating emerging technologies

IT Strategy and Planning— Works with Business Leadership to develop, evaluate and

implement IT strategies that are aligned with business imperatives

— Contributes to the business strategy development process— Understands the latest technologies and innovations and how

these might enable business processes

What Does a CIO’s Job Look Like?


Michael Earl, a leading academic, described in 1990 the successful CIO profile as having four essential elements along with a number of survival attributes.

Visionary

Relationship Builder Deliverer

Tactician

Source: Earl, M.J., Information Management, 1996

The 1990 View CIO Profile Elements Survival Attributes

Personal•IS Experience•IT Know-How•Social Skills•Sensitivity

IS Management Processes•Building a shared vision•Building relationships•CEO Relationship•Proactive Planning

Organizational Context•Organization’s attitude to IT

Performance•Creditability

Survival Attributes

Personal•IS Experience•IT Know-How•Social Skills•Sensitivity

IS Management Processes•Building a shared vision•Building relationships•CEO Relationship•Proactive Planning

Organizational Context•Organization’s attitude to IT

Performance•Creditability

CIO Profile


Earl’s current perspective is additive with some interesting insights from his continued study of this issue

Visionary

Systems Thinker

Relationship Builder

Alliance Manager

Deliverer

Architect

Tactician

Reformer

Source: Earl, M.J., Information Management, 1996, HBR, 2000

The 1996, 2000 View CIO Profile Elements Knowledge of IT is critical

One non-surviving CIO (and former CEO) in Earl’s study said “I want to take up the CEO job again -- but I only get offered CIO jobs. I want four times the rate for being a CIO than I would accept for being a CEO”

One states that CIO means ‘Career Is Over’

Knowledge of IT is critical

One non-surviving CIO (and former CEO) in Earl’s study said “I want to take up the CEO job again -- but I only get offered CIO jobs. I want four times the rate for being a CIO than I would accept for being a CEO”

One states that CIO means ‘Career Is Over’

Selected InsightsFortune 500 CIO’s

CIO Profile

14 th CIO Workshop July 27th, 2001 CEO IT Survey Findings.

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Transcript of 14 th CIO Workshop July 27th, 2001 CEO IT Survey Findings.