The 2012 Harvey Nash CIO Survey has provided a glimpse into the fast changing landscape that CIOs are operating in. From the dramatic emergence of social media as a high demand skill set, to the accelerating shift from consolidation into growth priorities, and the impact of women on relationships between IT and the wider business, there are many fast moving components in the life of today’s CIO.
More than half of CIOs in 2012 (56 percent) say projects that make money from technology rather than save money are the priority for their CEO. The search for growth is on, and organisations are increasingly looking to emerging markets to pursue it. And with almost two thirds of this year’s respondents having a global or multi-national focus (60 percent), the CIO is going to be key to unlocking this growth potential.
This year’s survey covered a wide geography with Australia becoming a major contributor to the survey for the first time and with responses being recorded from a diverse range of emerging markets including China, Croatia, Dubai, Greece, India, Israel, Japan, Lebanon, the Philippines, Qatar, Russia and Singapore. As organisations continue to search for growth in emerging markets CIOs need to be prepared for the challenges of operating in unfamiliar environments.
The strategic influence of the CIO continues to grow in line with the increased global responsibility they are being asked to take on; 52 percent of respondents now sit on their organisation’s operational board, up from 50 percent in 2011 and 42 percent in 2010. Over two thirds of respondents (68 percent) say the role of the CIO is becoming more strategic in 2012 and this is reflected in the dominance of the CEO as the most likely reporting line for the CIO.
Strategic priorities now focus on improving time to market for new products and services (a priority for 24 percent of CIOs versus only 17 percent in 2011); supporting mergers and acquisitions (15 percent, up from 12 percent in 2011); and investing time, focus and resources in mobile commerce, which is up from 17 percent in 2011 to 22 percent in 2012.
Demand for skills is returning with a particular emphasis on mobile solutions. In a long running trend analysis the report highlights an expected uptick in demand for skills that support innovation, however, the intensity in demand for mobile skills was greater than expected.
There has been a leap in demand for skills associated with mobile solutions (21 percent this year versus 14 percent in 2011), and given the rapidly expanding range of mobile platforms, security and resilience skills have also increased in demand (17 percent in 2012 versus 13 percent in 2011).
Skills associated with the rise of social media are another group to have seen growth this year (15 percent in 2012 versus 11 percent in 2011).
Digital media is firmly on the CIO's agenda with almost two thirds of global CIOs actively promoting the development of mobile phone and tablet applications for their organisation. The IT department and the Marketing department share responsibility for digital media; 43 percent of CIOs claim this to be the case compared to ten percent of global CIOs who have full control over the role of digital in their organisation.
A further 37 percent of CIOs state that the Marketing department probably has more influence in the digital media strategy than the IT department. This shared responsibility presents a big challenge for some CIOs and CMOs; where IT and marketing strategies were once developed in isolation they must now be integrated, and executed in synchronisation.
Some CIOs confirmed that the newer the technology, the more likely the CIO will be to actively promote it. As the technology matures and the CIO has determined the most secure / profitable route to utilising the platform the challenge becomes more about what to deliver via the channel. This often then becomes the responsibility of the content providers in the Marketing team.
There are positive signs that IT budgets are less restricted in 2012 as organisations pursue growth; 44 percent of global CIOs saw a budget increase this year compared to 39 percent in 2011 and 28 percent in 2010. CIOs are also regaining control over more of their budget. In 2011 more than one in ten (11 percent) of global CIOs didn’t control the majority of their IT spend; in 2012 this has dropped to seven percent.
Last year’s Harvey Nash CIO Survey highlighted the vital importance technology innovation had played in bringing many organisations safely, and efficiently, through the recession. Today, consolidation is being replaced by growth strategies, and innovation still has a crucial role to play.
For example, 71 percent of CIOs believe their organisation needs to embrace new technology otherwise they will lose market share, up from 67 percent in 2011. CIOs recognise there is still a significant gap in the expectations between the innovation ambition of their organisation and the innovation reality in their IT department.
Data gathered and analysed by Harvey Nash over the last ten years, including two economic downturns, shows that – counter to what many commentators might think – outsourcing decreases during economic downturns and returns to prominence when stability and growth ease the pressure on IT budgets.
Looking ahead, almost half of the respondents (46 percent) plan to increase their spend on outsourcing this year. This compares to 45 percent in 2011, but is 10 percent up on 2010 figures (36 percent) when IT budgets were more tightly constrained and economic uncertainty was more acute. Software development (63 percent in 2012 and 62 percent in 2011) still accounts for the vast majority of outsourcing activity. Software maintenance and data centres, both outsourced by 49 percent of CIOs, are the next most outsourced activity.
There is a clear link between the higher value outsourced activity, like software development and data centre management, and the skills shortage experienced by CIOs. As organisations, and more importantly the CEO, demand their teams prepare for growth, CIOs have to find the skilled resources to meet the demand from the business and the wider market.
During these times there is a clear link between the skills demanded by CIOs and the type of work outsourced by CIOs.Those who want to retain their competitive advantage have engaged reliable outsourcing partners who can step into the breach to ensure projects add value and are delivered within time / budget expectations.
CIOs have been looking for new career opportunities over the last two years, and almost one third of CIOs (29 percent) have moved roles within this time. A fresh challenge is still the top reason for looking at new job roles (by 34 percent of CIOs in 2012); more involvement in business strategy is the second most popular reason given for job seeking among senior IT leaders (28 percent).
Despite the volume of CIOs looking to change role this year, 82 percent of CIOs are still fulfilled by their current role (83 percent in 2011); this still remains higher than two years ago (76 percent satisfaction in 2010). However, this does not stop inquisitive CIOs from considering their career options.
One in five CIOs (20 percent) are actively seeking and applying for new roles. And a portion of the CIO community are looking beyond their next technology role: 14 percent are aiming for the CEO’s job in their next role.
The executive pay debate that is raging in the media and a nervousness to push salary inflation in the current economic climate, especially in Europe, seem to be having an impact on CIO remuneration. The average salary for CIOs globally has increased by 2.9 percent in the last year; it is currently $203,986 USD, up from $198,031 USD in 2011. However, expectations of salary growth in 2012 remain subdued; 61 percent of CIOs are experiencing a salary freeze this year (compared to 50 percent in 2011).
Beyond the executive pay debate there are a number of factors that influence CIO salaries. The most significant factor is the size of the IT budget. Big budgets and the responsibility that comes with them command bigger salaries. Another factor that has an impact, although less marked, is which industry the CIO works in.
For example Information or eCommerce based industries tend to have higher salaries, not for profit and product based industries less high. Location does have an influence on CIO remuneration, with US salaries trending roughly 15 percent above the global average.
Another factor that influences salary is length of service. CIOs moving into a new role or company can expect a slightly higher salary than the global average. Gender is also a part of the CIO salary equation as evidenced in the ‘Diversity CIO’ section of this year’s report.
In this new section of the Harvey Nash CIO Survey the role of women in IT departments and the view of the CIO to gender challenges in technology are explored. The male to female ratio in IT leadership remains highly unrepresentative of the population at large – 93 percent of CIOs responding to the survey this year are male – this compares to 92 percent male in the survey population from 2010.
Over a third of CIOs (35 percent) confirm there are no women in IT management roles in their organisation. For 46 percent of CIOs less than a quarter of their IT management roles are populated by women. The split of male to female workers is also significantly skewed in technical functions.
Almost a quarter of CIOs (24 percent) have no women in their technical teams; for 45 percent of CIOs women only make up about one quarter of their technical team, while for 20 percent of CIOs half their technical team are women.
Non-technical roles such as business analysis and training do have more women represented in IT departments. Six percent of CIOs have non technical teams that are almost exclusively made up of women; 12 percent of CIOs have non technical teams with women in 75 percent of the roles; 35 percent of CIOs have up to half their non technical roles filled by women.
Over half of CIOs (51 percent) think relationships between IT and the business improve by hiring more women, and 48 percent believe it enhances team cohesion and morale. However, the vast majority of CIOs think there is no impact on strategy (82 percent) and technical nous (86 percent) from hiring more women into IT.
There is a massive 30 percent gap between women CIOs and their male counterparts regarding their view of women ‘getting the job done’ at various levels of the IT team.
However, both male and female CIOs recognise that in the current fast moving environment, where it is very clear that IT departments are increasingly focused on managing business relationships to pursue growth and less on sweating technology assets to deliver efficiency, increasing the proportion of women in the IT team will improve relationships between IT and the rest of the business.