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CIOs indicate a return to growth and a change in priorities creates new skills challenges

CIOs indicate a return to growth and a change in priorities creates new skills challenges – Harvey Nash / TelecityGroup

CIOs are more confident of securing technology budget increases than at any time in the last five years, according to the CIO Technology Survey 2012, conducted by Harvey Nash in association with TelecityGroup.

The 14th annual survey, presenting the views of 2,400 CIOs and technology leaders across twenty countries, revealed that despite continued uncertainty in relation to the global macro-economic outlook, the rapid growth in demand for mobile applications and digital media innovation has ensured that the role of the CIO continues to remain key in 2012 and beyond. However, there is growing concern about the impact of a digital skills shortage and the question of gender diversity, in particular the availability of female talent in the technology sector.

Commenting on the results, Albert Ellis, CEO of Harvey Nash Group plc said:  “I am delighted that the survey has reflected our positive experience in the market. The innovation which is being driven by the spread of social media and the growth of mobile adoption around the world has provided opportunities for many corporations, but also huge challenges. Mobile and tablet software application engineering is now dominating demand in the market with an acute skills shortage developing. In California we are finding that successes such as Apple and Facebook have spawned a whole new generation of start ups anxious to recruit people skilled in new media. We are now seeing this phenomenon in the UK as well, particularly in London’s Tech City with its leadership in Europe in the digital sector.”

Key indicators of growth:

Increasing budgets: 44 percent of global CIOs saw a budget increase this year the highest proportion since 2007, and a leap from 39 percent in 2011 and 28 percent in 2010.

Leap in demand for digital and mobile solutions: Digital media is firmly on the CIO's agenda with 58 percent of global CIOs actively promoting the development of solutions for smartphones and tablets such as iPads.

Demand for improving time-to-market: Of the areas of focus for CIOs, the category that grew the most in 2012 was Improving Time-to-Market, underlining the importance of growth and expansion planning.

Profit focus: More than half of CIOs (56 percent) say projects that make money from technology rather than save money are the priority.

“As Boards look ahead seeking new ways to grow and innovate in an increasingly complex data-rich world, the role of the CIO takes on greater importance and increasing responsibility. We are seeing the DNA of IT leaders changing as they have become more representative of their internal and external customers. It is a very exciting time to be a CIO.” said TelecityGroup CEO, Michael Tobin.

Women in technology and skills shortage

Increased shortages in digital skills: Of all the categories of skills where shortages exist, mobile, security and social media displayed the greatest growth in shortage.

Overall skills shortage grows: Almost half (47 percent) of CIOs believe a skills shortage is preventing them from keeping up with the pace of change.

Gender balance within leadership in the Technology sector: 93 percent of CIOs in the Survey are male, virtually unchanged from the 2005 Harvey Nash CIO survey. Dearth in pipeline of female leadership talent: Over a third of those surveyed confirmed they have no females in Technology leadership or management roles in their organisation, and over three-quarters (81 percent) have less than a quarter of management roles populated by women.

Software engineering not seen as attractive to female graduates: almost a quarter of CIOs (24 percent) have no women in their technical and development teams, suggesting more needs to be done to encourage women into IT at an early stage.

Reflecting on the gender results, Albert Ellis, CEO of Harvey Nash Group plc said:

“This is a challenge for technology companies and IT departments around the world. Traditionally, all forms of engineering have suffered from an image problem. In the past female graduates have not aspired to be “tech geeks” and a career in IT has not been seen as attractive. Technology companies and groups will miss out in the future and this makes the skills shortage even more acute. However such high profile marketplace developments like the up and coming Facebook IPO will draw attention to the enormous potential offered by careers in technology, and I am confident young people of both genders, faced with a challenging jobs market particularly in Europe, will increasingly aspire to be part of the growing success of the technology sector worldwide.”

Outsourcing, role of CIO

Outsourcing plays a bigger role: almost half of the respondents (46 percent) plan to increase their spend on outsourcing this year. This compares to 45 percent in 2011, however, it is 10 percent up on 2010 figures (36 percent).

Multi sourcing in vogue: The use of multi sourcing will increase this year for 43 percent of CIOs, up from 39 percent last year.

Commenting on the results, Michael Tobin, CEO TelecityGroup, said:

“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 CEOs demand their teams to prepare for growth, CIOs have to find the skilled resources to meet the demand from the business and the wider market. 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 and budget expectations”.

CIO role is changing and increasing in importance: 52 percent of respondents now sit on their organisation’s operational board, up from 50 percent in 2011 and 42 percent in 2010.

Strategic influence of the CIO continues to grow: 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.

Concluding on the results, Michael Tobin, CEO TelecityGroup, continued:

“Without doubt, it is a challenging and fast-moving time to be a CIO. The IT department has undergone more radical change in the last decade than perhaps any other business function. And what this report shows is that the change continues. The recession has forced many IT departments to become leaner, but now as CEOs and CIOs alike pursue growth, the challenge will be to stay both lean, but appropriately resourced. It’s certainly something that we are experiencing first hand at TelecityGroup CIOs and CEOs tend to come to us with a growth strategy in one hand, and a cost management strategy in the other, which fits well with our data centre proposition.

“As boards look beyond the recession seeking new ways to grow and innovate in an increasingly complex, data rich world, the role of the CIO has never been more important.”


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