IT is experiencing a historic period of “profound change,” according to the preliminary results of “35th Annual SIM IT Trends Study,” published recently by the The Society for Information Management. The SIM IT trends survey is based on the responses of 1,002 IT managers and leaders at 717 organizations. Of the respondents, 451 are CIOs. The organizations’ average annual revenue is $5.6 billion, with an average IT budget of $288 million.
Three trends highlighted by the survey underscore the importance for CIO’s to impact business oriented performance measures, develop their people leadership skills and invest in employee training & development. The study’s lead researcher Leon Kappleman says, “IT organizations are not focusing on cost cutting like they used to be, but instead their focus today is on how to create value for the business.”
IT Focuses More on the Business, Less on Internal Services
The concept of IT in the enterprise is in a period of transition, as IT for many organizations today is less about directly providing internal services and more about driving the business and contributing to business strategy. Of the top 10 performance measures for CIOs, the top four (value of IT to the business, IT’s contribution to strategy, customer satisfaction, and innovative new ideas) are business oriented, not IT oriented. Performance measures five through seven are IT oriented (availability, projects delivered on time, and IT cost controls), but the rest of the top 10 fall in the business category (productivity improvement, business cost reduction controls and revenue growth). In summary, seven of the top 10 performance measures for CIOs relate to business, not IT.
Top Leadership Skills Are People Skills
When asked to name the top 10 skills for CIO success, the respondents overwhelmingly named people skills, not technical know-how, as being most vital. Note that “emotional intelligence,” for example, grabs the number seven spot in the below list. The leading 10 skills for CIO success are:
- Provide leadership (35%)
- People management (30%)
- Strategic planning (24%)
- Decision making (24%)
- Verbal communication (21%)
- Collaboration (21%)
- Emotional Intelligence (16%)
- Honesty (16%)
- Business analysis (12%)
- Change management (12%)
IT Talent Comes, IT Talent Goes
In an effort to retain their IT talent, CIOs have increased their spending on employee training and education for the second consecutive year, with a slight bump to 4.99 percent in 2014 from 4.68 percent in 2013. This spending is justified in view of the “very high turnover in IT,” said Kappelman, who pointed out the employee turnover rate among the respondents was 8.97 percent in 2014, which is significantly higher than the 10-year average employee turnover rate of 6.26 percent. Overall, CIOs themselves enjoyed a slight increase in job tenure, from an average of 5.20 years in 2013 to 5.41 years in 2014.