Australian and New Zealand CIOs are intensifying their efforts to strengthen digital leadership with more investing in digital initiatives, and fewer in core systems such as ERP, according to Gartner’s annual survey.
Compared with their global peers, ANZ CIOs place a higher priority on customer focus and digitalisation.
The 2017 Gartner CIO Agenda Survey gathered data from almost 2600 CIO respondents in 93 countries and all major industries, representing US$9.4 trillion in revenue/public sector budgets and US$292 billion in IT spending, including 173 CIO respondents from ANZ.
The survey showed that 49 per cent of ANZ CIOs are using digital ecosystems as platforms to exchange information and interact electronically with competitors, customers, regulators, stakeholders and other enterprises.
“The implications of digital ecosystems for ANZ CIOs are profound,” said Jenny Beresford, research director at Gartner. “Many will need to shift their enterprise from a linear value chain business, trading with well-known partners and adding value in steps, to being part of a faster and more dynamic networked digital ecosystem. While many are actively participating now, ANZ CIOs need to take a more assertive and ambitious outlook to avoid falling behind in 2018.”
CIOs globally are reporting that they expect to spend more on digitalisation in 2017, with ANZ CIOs ahead of the overall average on investment and focus. ANZ CIOs exceed their global peers in their expectation of digital spend from the IT budget this year, as well as in their projections for 2018.
“One of the most significant digital investment challenges for ANZ CIOs is that digital programs require a multi-year budget approach,” said Beresford. “They share frustration with their business executives in trying to accelerate digital investment while budgets are still adjusted on a quarterly or annual basis, lagging changes in revenue forecasts and pace of digital demand.”
ANZ CIOs are focused on cost efficiencies – more likely to prioritise using IT for business cost optimisation over cutting the cost of day-to-day IT services than global peers.
“The strong business focus of ANZ CIOs also shows in their strong performance on stakeholder satisfaction with IT services, where ANZ CIOs are slightly above average on a global scale,” Beresford said.
When it comes to barriers to achieving their objectives, ANZ CIOs cite a lack of skills and resources as the biggest issue – with the most significant talent gaps as information, analytics, data scientist and business intelligence skills, along with their global peers. However, the next biggest gap in ANZ is digital business/digital marketing skills, while CIOs globally cited security.
“In some cases, ANZ CIOs who are well connected with their peers and competitors in similar industries are exploring ways of overcoming talent gaps by talent sharing,” said Ms. Beresford. “Some business and technology leaders are also exploring ways to cross expose business and technology staff for extended exposure.”
The top areas of new technology investments show that significant spending and opportunity comes in big data and analytics, and that cloud continues to have significant momentum. Digital investment is more popular among ANZ CIOs (28 per cent) than global peers (16 per cent), while proportionally fewer ANZ CIOs are reporting core or ERP systems to be a top technology area than their global peers.
Table: Technology priorities, Gartner
| 2017 rank | Priority in ANZ | ANZ percentage | Global rank |
| 1 | BI/analytics | 42{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 1 |
| 2 | Cloud | 33{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 2 |
| 3 | Digitalisation/digital marketing | 28{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 6 |
| 4 | Mobile | 19{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 7 |
| 5 | ERP | 17{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 4 |
| 6 | Infrastructure and data centre | 16{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 3 |
| 7 | CRM | 14{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 8 |
| =8 | Cyber/information security | 9{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 5 |
| =8 | Industry-specific applications | 9{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 9 |
| =8 | Legacy modernisation | 9{db8ca4bbfe57dc8f9b6df9233a3a6c04f4968125edf9bb330d4f787c3a87cd09} | 10 |
*Note: Percentages represent the proportion of CIOs citing each priority as one of their top three areas of new IT spending.
