CIOs Show Strong Regional Differences
CIOs worldwide may share many common traits and concerns, but issues experienced by these technocrats are far from universal. A recent global survey by Gartner notes there are considerable differences in their priorities, at both a regional and country level.
Gartner sees economic conditions vary considerably. For example, while global IT budgets are flat (0.2% growth in 2013 to 2014) on an average, CIOs in Latin America are looking at an average budget increase of 7.3%. This is typically in line with macroeconomic conditions.
“The CIO survey results clearly show that as digital opportunities and threats pervade every aspect of business and government, the IT and digital agenda for each country, industry and enterprise is becoming more unique,” says Dave Aron, VP and Gartner Fellow.
Aron believes the way businesses and public-sector agencies use information and digital technologies is getting more entwined with their economic, regulatory and competitive contexts, as well as with the state of their business and digital maturity, as a result of which “our digital footprints are becoming all the more unique,” he states.
From the regional viewpoint, CIOs in North America report an IT budget increase of 1.8% this year. “This means that North American CIOs may have more room to maneuver than their counterparts in EMEA, where the average IT budget is down 2.4%,” says the report.
Sixty-two percent of CIOs in North America are expecting to change technology and sourcing strategies in the next two to three years; however, this is the lowest percentage in any of the major geographies. For example, 82% of CIOs in China and 75% IN India expect to change their technology and sourcing approach in the coming two years.
Gartner also noted only 26% of North American CIOs report they have made significant use of public cloud offerings, and recommends they still need to venture into significant public cloud usage.
CIOs in China reveal a higher business focus on growth and innovation, and a significantly higher IT budget increase of 13% this year, way above the global average of 0.2%. However, at least 45 percent of IT spending is outside the IT organization, compared with the global average of 26 percent.
Emerging countries such as China, India and Indonesia appear bullish on digital and cloud. The total cloud market in India in 2013 was $421 million, and the total market for public cloud services in India is expected to reach $1.7 billion in 2018. with CIOs from these regions identifying a C-level digital leader such as a chief digital officer (CDO) more aggressively than the global average.
In the UK and Ireland, 65% of CIOs expect to increase their sourcing of IT in the near future. The desire to cut costs is traditionally one of the primary reasons behind this shift in sourcing strategy. However, there is also an increasing desire to achieve agility as well through partnerships with external service providers.
Most companies in Latin America are confident that they should take advantage of digital economy opportunities. Another relevant trend is that 25% of IT spend is outside of the IT budget as against 26% globally, with Brazil reaching 34%.
The survey also reveals growing digital confidence among CIOs in the region. While 42% of global CIO respondents think they don’t have the IT skills and capabilities to meet digital challenges, in Latin America only 26% of IT organizations think they are not ready to “tame the digital dragon.”
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