CEOs from India and around the world agree that radical changes are in store for their organisations over the next two years and innovation, rather than mere cost-cutting, will be the key to success.
The IBM 2006 CEO study, covering a total of 765 CEOs, including 44 from India, further indicates that 'CIO (chief information officer) implications have now changed from setting up a cost-effective IT structure to creating a structure that can scale up without high cost implications and is robust, secure, innovative and completely integrated with business', according to Nipun Mehrotra, director (global technology services, South Asia) IBM.
Information Technology is finally breaking into boardrooms and CEO priorities have changed from cost-cutting to profitable growth and innovation, he adds.
CIOs will have to gradually move away from maintenance and support tasks which occupy nearly 80 percent of their time (ideally should be 10-15 percent) to technology, system design and planning that occupies around 18-19 percent of their time (ideally should be 20 percent).
Business Planning and IT strategy should get around 40 percent of their time.
Mehrotra notes that 52 percent of Indian CEOs feel that their organisations are satisfactorily integrated compared with global average of 45 percent.
Nearly 86 percent of Indian CEOs also rated 'business and technology integration' as prime concerns. Over 80 percent of CEOs admitted their organisations were not successful in managing changes, while 76 percent CEOs ranked business partnerships and collaboration as top sources for new ideas.
In emerging markets like India, 73 percent of CEOs are collaborating, compared with 47 percent in mature markets.
On the innovation front, only 14 percent of CEOs ranked internal R&D as a source for new ideas.
CEOs' top obstacles to innovation within the company were an unsupportive culture and climate (35 percent) and externally, it was government and other legal restrictions (32 percent). CEOs said the most significant sources for innovative ideas came from employees, business partners and customers.
In terms of innovation, CEOs stated that internal inhibitors were more significant than external hurdles. However, only 35 percent of CEOs were willing to take on these inhibitors by making innovation a CEO responsibility. But, as was the case with collaboration, CEOs have a major 'integration gap' only half are executing at that level.
In 2004, the IBM CEO study had revealed that CEOs had turned their agenda from cost-cutting to driving profitable growth. Asia was cited as key new markets for revenue growth.
The 2004 study had implied that by taking costs out of infrastructure and reinvesting the savings, CIOs can drive both cost reduction and business enablement and innovation.
'For CIOs, this means developing a mindset of running IT as a business, and employing the same kinds of analytical and management tools that their business-line peers are using', it had concluded.
