Great expectations: The changing role of IT in business

CIOs and IT managers today face no shortage of challenges, from overseeing the convergence of voice and data networks to grappling with compliance, data security and tight spending budgets. Their jobs are set to become tougher: CEOs and boards expect information technology‘s mission to expand from cost cutting to revenue generation, and relatively quickly.
This is among the major findings of a new Economist Intelligence Unit research programme, sponsored by Capgemini, Cisco Systems and SAP, on the evolution of IT‘s role within the business. The study is based on a global survey of 288 senior executives in both technology and business functions as well as in-depth interviews with senior IT executives.
Other key findings of the research include the following:
An “expectations gap” exists between IT and the executive suite. Most technology managers (62%) also believe that enabling revenue generation will come to be IT‘s primary mission within the next three years, but CEOs and board members (83%) are almost wholly convinced of it. The gap yawns particularly wide in Asia-Pacific and Europe, where many IT managers retain a strong belief in the primacy of IT‘s cost-reduction role—partly due to continued C-level insistence on hitting cost-efficiency targets. This gap will need to close—and C-level priorities to become more consistent— for better IT-business alignment to be achieved.
Organisational and technical solutions will be tapped to improve IT‘s fit with the business objectives. The acquisition of new technologies tops the list of initiatives that survey respondents, including CEOs, hope will improve the level of IT-business alignment. But organisational measures are also prominent: all executives place strong emphasis on joint project management responsibility between IT and business managers, as well as the use of cross-functional teams.
Some decentralisation of IT functions to other business units is also likely. The beginning of the end of the IT department as we know it? The majority of surveyed executives think not, at least for the next five years. But as many CEOs and board members (41%) foresee the disappearance of a stand-alone IT department as those who do not. More than a few companies appear ready to consider radical solutions to bring IT and the business closer together....... ( source.. business economics research)