Discord in perception of IT's importance

A survey of CEOs and CIOs has revealed the latter value their role more highly than the former
  • Denise Dubie (Unknown Publication)
  • 18 February, 2007 22:00

IT executives think highly of their ability to deliver effective IT strategies. In fact, technology leaders value their strategic contributions quite a bit higher than their business counterparts do, according to a survey by Saugatuck Technology.

The results concur with those of a survey of CEOs by Forrester (see opposite page) which showed they veiwed CIOs as steady performers but not great innovators.

Saugatuck surveyed 340 C-Level executives and 240 CIOs and senior IT executives at companies with greater than US$1 billion (NZ$1.44 billion) in revenue. The survey was conducted in partnership with BusinessWeek Research Services and its findings, released in December, reveal a chasm between what CEOs and those in similar positions think of IT's effectiveness as compared with what technology leaders perceive.

"The unsettling conclusion from this is that while everyone seems to agree on IT strategy priorities at a strategic level, there is still quite a bit of room for improvement at the tactical level," Saugatuck wrote in a research alert accompanying the report. "This tactical dysfunction between IT and business executives serves as a tremendous indicator as to why we consistently see gaps between the real and perceived value of IT to the enterprise."

The disconnect between the two camps is most obvious among IT initiatives that focus on business process outsourcing (BPO), database consolidation, and server consolidation andvirtualization, the survey found. About 70% of IT executives said BPO strategies were effective, while 42% of business leaders agreed. Close to 80% of CIOs said database consolidation efforts were paying off, but just 53% of CEOs indicated that they felt the same. Approximately three-quarters of technology heads reported server consolidation and virtualisation strategies as effective, yet just 55%of business chiefs agreed with that stance.

Other areas that business and IT leaders didn't agree upon include business intelligence and performance management initiatives, which saw a 19% difference in effectiveness ratings, and application consolidation efforts, in which effectiveness ratings varied by 17%.

The results could indicate tough times ahead for technology chiefs selling IT projects to business leaders, Saugatuck says.

"If business executives, especially CFOs, don't see enough IT investments as effective, they will continue to seek control — and in some cases even micro-manage — IT spending," the firm writes. "This implies not only continued IT budget restrictions, but also a continuation of project-based IT investment."