Canadian CEOs Give Thumbs Down to IT

Want to hang onto your job? Then take note – according to a recently published survey, CEOs increasingly view information technology as a key strategic tool, but are disappointed in IT achievements. Even more troubling, Canadians ranked dead last among surveyed countries when it comes to satisfying the CEO on IT performance. Despite this, Canada was among the countries that rated highest in terms of the CEO’s expectations of IT contribution to business performance improvement.

These findings highlight the Compass 1999 IT Census, a global survey of 650 CEOs and other senior executives from a variety of industries in eleven countries.

Conducted by the Department of Information Systems at the London School of Economics, the study was commissioned by Compass Analysis, a management consulting firm specializing in business performance improvement.

“The bottom line is that CEOs expect more from IT than they’re getting,” said Max Staines, vice president, Compass Analysis Canada Limited. “Whether their expectations are realistic or not is beside the point. IT management needs to do a better job at delivering and demonstrating value from IT.”

The status of the IT director in Canada varies widely. While a high proportion of respondents (51 per cent) claimed the IT director played a prominent role in defining corporate strategy, this was offset by 49 per cent saying the IT Director played no role at all, or only a minor role.

There is a clear link between the status of the IT director, and CEO satisfaction, the survey found. Worldwide, among CEOs who say their IT director has a prominent role in defining corporate strategy, 36 per cent give IT a top rating in terms of business contribution. This drops to 14 per cent when the CEOs say their IT director has a minor role or no role in corporate strategy. The inference is clear: the more the IT director influences corporate strategy, the more likely he or she is to deliver value.

Only 11 per cent of Canadian CEOs ranked IT performance as the top contributor to business results, compared to a worldwide figure of 24 per cent. Canadian CEOs had among the highest expectations of IT contribution to business performance improvement (55 per cent had rated performance improvement as their top priority) but were the most disappointed. Only 20 per cent rate themselves highly satisfied with the results, compared to a worldwide figure of 32 per cent.

Canadian CEOs had the lowest expectations of IT’s contribution to cost management, with only 19 per cent rating it most highly. It lags behind other deliverables even in terms of future expectations, and is clearly not a top priority now that business emphasis has switched to value.

Competitive edge, on the other hand, is going to be one of the key deliverables of the future. Expectations of IT-enabled competitive advantage were among the highest, with 39 per cent of Canadian CEOs rating it most highly. Actual performance results in this area were among the lowest, with only 16 per cent rating performance highly. This has not discouraged Canadian CEOs, who show no sign of letting up on their expectations. Half of them rate competitive advantage as a top priority for the future, broadly reflecting the rest of world opinion.