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CIOs need to actively engage in budget decisions: Gartner

CIOs need to actively engage in budget decisions: Gartner

Advises CIOs to work with business executives and the CFO to ensure critical contribution of IT is incorporated early on in budget discussions.

IT is more and more a key component of all business initiatives and is becoming an important part of those budgets.

CIOs, therefore, must work with business executives and the CFO to ensure the critical contribution of IT is included early in the strategic planning and budget planning processes, advises Gartner.

"In the past, the use of IT to support the business came almost as an afterthought, long after the business strategy and strategic initiatives for the coming period had been designed and sanctioned by top management," says Cassio Dreyfuss, research vice president at Gartner, in a statement

The CIO is challenged to adopt a higher profile and actively engage in opportunities to influence IT decisions in business budgets.

Cassio Dreyfuss, Gartner

"Over time, IT has graduated from being a support tool to being a business enabling and a business creation tool. Under that much broader and inclusive perspective, it makes more sense to talk about IT-related expenditures in each and every business initiative and respective budget.

“In this way, the CIO is challenged to adopt a higher profile and actively engage in opportunities to influence IT decisions in business budgets."

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Gartner notes the appropriate IT budget decisions follow different processes for each organisation, depending on its work style, which, in turn, depends on external variables (mostly its business environment) and internal variables (mostly the style of how its people and areas work together and make decisions).

However different decisions may be, Gartner says the CIO has unique contributions to IT budget decisions for organisations of all styles — but CIOs must understand the business challenges and work styles of each of them to effectively influence IT budget decisions.

"The road toward a digital future requires transformational action from IT through disruptive innovation while continuing to run "business as usual" at the expected level of excellence," says Dreyfuss. "IT must therefore operate at high-performance levels at two very different modes."

Gartner says the IT organisation is in a position to get broadly and intensely involved with budget decisions as it can bring the following key perspectives:

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Information architecture: Knowledge of the information that is used in the organisation, who uses what information, when, how and with what objective.

Business process networks: Knowledge of the processes in the organisation, wall to wall, their rules and dynamics, who performs them, when, how and with what objective.

Operations infrastructure: Mastery of how to run all those processes and deliver all that information, their cycles, their integration requirements and all their interfaces with people.

Technology scenario: Comprehensive and educated perspective on the technology scenario and its evolution, and the features, opportunities, challenges, risks and the economics of IT tools.

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"These characteristics legitimise CIOs and their teams as advisors to all budgets in all functions within the enterprise," says Michael Smith, vice president and distinguished analyst at Gartner.

"In addition, IT leaders will advise business leaders on how to secure, integrate and manage the quality of the information that fuels digital business. These capabilities are what CIOs and their teams will have budgeting responsibility for as traditional enterprises make the transformation to digital businesses."

Send news tips and comments to divina_paredes@idg.co.nz

Follow Divina Paredes on Twitter: @divinap

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