Forrester advises CIOs on business management

CIOs are reworking how they manage IT to address business technology (BT)–pervasive technology use accompanied by increased direct engagement of non-IT business leaders.

Traditionally, CIOs run their firms’ tech factories and respond to business needs with their solutions. But with BT, organizations directly contract for solutions, configure their own processes in ERP and analytics systems, or employ Web 2.0 technologies like blogs and wikis. Nearly 20 percent of the 600 senior business executives in a Forrester survey self-identified as either entirely responsible or more responsible than IT for choosing vendor-provided solutions and negotiating and managing the relationship. And this number was doubled for fast-paced functions like sales and marketing.

To read more on this topic, see: You Say IT, Forrester Says BT: What’s the Difference?

In order to address BT management challenges, a BT leadership maturity framework and self-assessment tool are key. Such a tool evaluates BT capabilities–risk metrics, business results from IT services and business satisfaction, for example–that cover the core management elements across domains. The traditional model isn’t going away, but it can’t keep pace with business’s accelerating demand. Traditional IT management only refines and revises prioritization criteria and IT governance processes. In most firms, less than a third of IT spending is reserved for new investments, most of which goes to re-educating staff and re-architecting solutions.

Why do CIOs need an updated leadership model? CIOs must increase IT’s intimacy with the business. Business decisions should not be made sequentially or iteratively through the slow, complex governance processes of traditional IT leadership. And success must be measured based on business results, not traditional IT metrics.

For BT leadership success, CIOs separate those in their organizations who focus on business enablement from those responsible for IT’s delivery of operational excellence. CIOs embed into business organizations key roles previously found only within the IT organization–like business analysis, project management and solution configuration. And CIOs move beyond only aligning IT’s resources to synchronizing IT and business planning.

Bobby Cameron is a vice president and principal analyst at Forrester Research, where his research focuses on CIOs.

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