Shadow IT inspires a renaissance for CIOs

15 December 2014

CIOs in banking are finding new ways to add value to their organisations 

Chief information officers (CIOs) in banking have an unprecedented opportunity to take a leading role in their organisations, thanks in part to the rise of “shadow IT”. That’s one of the paradoxical findings of a new global study published today by BT, based on a survey of almost 1,000 senior IT decision makers in eight regions and six sectors worldwide. 

“Shadow IT” is the name given to the growing practice of departments, such as finance or marketing, buying their own IT solutions.  According to the study, “Art of Connecting: creativity and the modern CIO”, the practice is now common in banking, with 78 per cent of CIOs seeing it within their organisations, compared with 76 per cent globally.  On average, shadow IT now accounts for 25 per cent of banking organisations IT spend, the same as the international average. 

The growing confidence of departments in buying their own IT solutions is shifting the CIO’s focus away from hands-on support to a more strategic role centred on advice, governance and security.  Indeed, CIOs in banking are now spending 21 per cent more time and substantial additional budget on security as a result of shadow IT. The global average is 20 per cent. 

Despite worries about a loss of control and sizeable reductions to their overall budgets, the changes driven by shadow IT give CIOs a unique opportunity to evolve their role.Luis Alvarez, chief executive officer, BT Global Services, said: “CIOs are perfectly placed to nurture creative uses of technology throughout their organisations while keeping a strategic view.  Indeed, our research shows that the board expects nothing less.”

Seven out of ten respondents in banking say that the CIO now has a much more central role in the boardroom compared with two years ago, versus almost six-in-ten of CIOs globally.  And 78 per cent believe that their board’s expectations of them have increased substantially during the same period, compared with 68 per cent of international respondents.

This is reflected in the types of key performance indicators (KPIs) that CIOs are now accountable for.  Whereas a traditional CIO would have been judged largely on IT metrics, 89 per cent of respondents in banking say they now own more business than technology KPIs, compared with 81 per cent globally. 

Aligned to this, 77 per cent of respondents in banking believe their board now recognises the need for a much more creative CIO, one that can operate across the organisation, orchestrating technology and skills to deliver departmental or strategic business outcomes. It’s a change that the majority of CIOs in banking positively embrace; with 76 per cent saying the ability to be more innovative and creative is the biggest plus of their job, versus 69 per cent globally.

CIOs in banking view big data   (79 per cent, versus 64 per cent globally), unified communications (78 per cent, versus 72 per cent globally) and software as a service (77 per cent, versus 61 per cent globally) as some of the technologies that can help them unlock their creativity.  And in a win-win, these are also identified as being some of the most critical to delivering commercial results.  So the more CIOs are creative in their use of big data, software as a service and unified communications, the more likely they are to meet the expectations of their board. 

Luis Alvarez said: “I’ve been a CIO and to me it feels as if we’re on the verge of a renaissance of the profession with greater opportunities than ever before.  In this new environment, CIOs who can adopt a creative, imaginative and visionary mind-set, and look more to their IT partners for innovation and fresh thinking, will thrive.”

Dave Aron, Gartner Fellow, et al., wrote: “digitalization is no longer a sideshow — it has moved to center stage and is changing the whole game. CIOs have a unique opportunity to take a strong digital leadership role in the transformation of their businesses. Seizing this opportunity requires flipping long-held behaviors and beliefs.”1

1 Gartner, Flipping to Digital Leadership: The 2015 CIO Agenda, 04 October 2014, Dave Aron et al.

“Art of Connecting: creativity and the modern CIO” is based on a survey of 955 senior IT decision makers in the USA, UK, Germany, Brazil, Spain, Australia, Benelux and Singapore. Respondents were from organisations with over 1,000 employees and were drawn from the banking, retail, energy & resources, transport and logistics, manufacturing and public sectors.

The survey was conducted during November 2014 by independent market researcher Vanson Bourne.  “Art of Connecting: creativity and the modern CIO” can be downloaded via the BT website.

Become a bobsguide member to access the following

1. Unrestricted access to bobsguide
2. Send a proposal request
3. Insights delivered daily to your inbox
4. Career development