CIOs Face Changes, Volatility In 2017, Forrester Predicts- Valutrics

 

IT transitions will accelerate in 2017 as CIOs look to deliver business outcomes, develop technologies that serve customers, and embrace new technologies such as AI and AR, according to Forrester Research. Here’s a look at the research firm’s predictions for the new year. 

If you thought 2016 was crazy, just wait for 2017. Forrester Research is predicting volatility for enterprise IT organizations next year as customers gain more influence. CIOs will find that they will need to accelerate the pace of change.

Forrester released its predictions in the new report, “Predictions 2017: CIOs Push For Speed Amid Volatility.”

CIOs used to be in the utility business — maintaining and operating the systems that run the business. But that charter is changing as organizations embed technology into the products and services they offer to their own customers. Now CIOs must make their business’s customers a central focus of the IT organization.

“If you are a CIO and you are out there delivering business outcomes, that’s the thing that will help you be successful,” said report author Matthew Guarini in an interview with InformationWeek. “If you stay within the realm of what IT looked like five or ten years ago, there’s a risk that your IT organization will be marginalized.”

That’s not the message that some IT pros will want to hear as they grapple with flat budgets and legacy infrastructure. Even if you don’t want to hear about the approaching challenges, they will not stop coming until you are ready for them.

“The ability for new companies to come in and disrupt industries has been amazing,” Guarini said. CIOs need to prepare their strategies and their teams for those approaching changes.

“Firms need to be customer-led and insights-driven,” he said. “They need to move fast, and they need to be connected.”

The term “customer-obsessed” appears repeatedly throughout the new Forrester report, and it’s something that CIOs at progressive organizations need to embrace, the report says.

While these changes really should be driven from the CEO-level down, that might not always happen. But even without that support, CIOs can work to build partnerships with other senior-level executives (such as the CMO or the CFO) to get started driving these changes, needed for customer focus and speed.

For instance, a partnership with the CFO could support a new trend in budgeting, where companies look at quarterly investment cycles, rather than annual cycles. Working together, the CIO and the CFO could apply Agile thinking and development sprints to the budgeting process, Guarini said.

Forrester broke out several trends in its 2017 predictions report.

Customer-Driven Transformations

The theme of the customer’s influence and power runs throughout the Forrester report. Indeed, Forrester describes customers as “insatiable, putting pressure on all your firm’s operations.” As for 2017, “expect firm-wide operational changes to focus on customer experience — and an increasing number of wholesale business model changes to focus on specific customer journeys.”

Executive Turnover

Forrester says that business and operational model changes will drive new leadership. That’s because yesterday’s leadership skills don’t encompass the customer obsession that’s needed to succeed today. “In 2017, CIOs will see many of their business partners change as turnover rates for executives with P&L responsibilities increase up to 30% or more,” the report said. “Similarly, many CIO/CMO partnerships that have been a big focus over the past few years will need to be rebuilt, as CMO turnover will also hover around 30%.”

 

IT Budget Shifts

Even as you contemplate the aforementioned changes, don’t expect to see a big boost in your IT budget. Forrester says that declining economic prospects and increasing uncertainties will result in a 2.9% increase in tech spending in 2017.

Forrester recommends that CIOs make the most of what you have by focusing new projects on business technology that helps to win, serve, and retain customers, leverage the cloud to provide access to new technologies and short-term cost benefits, and look for savings in your traditional IT spending to fund investment elsewhere.

Emerging Tech Gets Real, Fast

Consumers are adopting new technology faster than they ever have before. That will impact IT organizations as these users look for the newest technology. “In 2017, expect that rapid tech adoption to center on new technologies that bridge the digital/physical divide like AR [augmented reality], the IoT [Internet of Things], and AI [Artificial Intelligence].”