Presenter’s name

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1 Presenter’s title
 Survey Purpose &
Methodology
• CIO’s seventh annual “State of the CIO” survey was
conducted with the objective of understanding how the
role of the CIO continues to evolve in today’s business
climate and to help define the CIO agenda for 2008.
• Conducted online from July 9-31, 2007 across a sample of
senior IT executives from the CIO audience database. The
survey was also sent to the 2007 State of the CIO survey
respondents.
• Respondents: 558 heads of IT. Margin of error: +/- 4.1%.
Percents may not sum to 100 due to rounding.
• Company size defined by revenue: Small: <$100 million;
Mid-size: $100 million - $999.9 million; Large: $1 billion or
more.

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 Respondent Profile
• All 558 respondents are the top IT person at their organizations.
• 64% hold a CIO/CTO title; 21% general manager/managing
director/director IT; 11% EVP/SVP/VP and 4% other.
• 90% are responsible for enterprise-wide IT decisions and 10% for
divisional IT decisions.
• Broad range of industries represented including manufacturing
(12%), medical/healthcare (10%), wholesale/retailer/distributor
(9%), education/nonprofit (9%), finance/banking/accounting
(9%), government (9%).
• This year’s study contains more respondents from large
companies. Small: 26% (39% in ’07); Mid-sized: 39% (36% in
‘07); Large: 32% (22% in 2007). This should be considered when
making comparisons with data from previous years.

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 The value CIOs can bring to the enterprise
is limited only by their energy and
imagination…and sometimes
by organizations that just don’t get it

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 The State of the CIO &
The Future-State CIO Model
0 100
25 50 75

2 - Transformational Leader
Alignment and Business Process Transformation 3 - Business Strategist
Allocation of CIO’s Time

Enterprise Strategy &

Competitive Differentiation
51%
12%

1 - Functional Head
Operational Excellence

37%

CIO’s C-Level Competency Performance

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5 Source: The Future-State CIO, CIO Executive Council, 2007.
 CIO Archetypes

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 Company Size
Distribution
by Type

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 Members of the Executive
Committee

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 Understanding how the role of the CIO continues
to evolve in today’s business climate including:
seniority,
reporting structure, budgetary responsibilities,
technical and management priorities, business
and leadership challenges and the key skills
needed for the job today.

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 CIO Title Grows

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 More Business Strategists
Report to the CEO

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 More CIOs Report to the CEO
than Any Other Position

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 Compensation Is on the Rise

NOTE: Average pay by revenue size (Large = $1 billion or more; Midsize = $101 million to $999 million;
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13 Small = $100 million or less) Numbers are in thousands (000)
 Tenure Is Getting
Shorter

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 Tenure & Compensation by
Industry

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 CIOs Spend Most of
Their Time With Staff

NOTE: Respondents were asked to estimate the amount of time spent with each
group.
Q: Of the time you typically spend interacting with each of the following constituencies, please estimate
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16 the percent of your time spent with each group.
 Business Strategists Spend
More Time in the Business

Q: Of the time you typically spend interacting with each of the following constituencies, please estimate
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17 the percent of your time spent with each group.
 Leadership Competencies
Different Among Types

Q: Which of the following executive leadership competencies is most critical to your current role? Choose
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18 three.
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 IT Budget as Percentage of
Revenue
Average IT spending as a percentage of revenue

Q: What percent of your company’s total revenue does the IT budget represent?
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 IT Spending by Industry

Health care CIOs have relatively small IT budgets but they

spend a larger percentage of that budget (43%) on
discretionary projects than all other industries, allowing
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them to drive
Q: What percent innovation.
of your company’s total revenue does the IT budget represent?
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 Control Over IT Spending

Q: How is IT spending controlled?

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 ROI Accountability

Q: Who is primarily accountable for IT ROI?

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 IT Staff-to-User Ratio

Q: How many internal users does your IT organization support?

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24 Q: What is the headcount of your IT staff in full-time equivalents, not including contract employees or
outsourced employees?
 IT Staff-to-User Ratio
by Industry

Manufacturing

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 IT Headcount

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26 Q: Will your headcount increase, decrease or remain unchanged over the next 12 months?
 Percent of Labor Outsourced

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27 Q: What percent of your total IT labor is provided by outsourcers or contract service providers?
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 Innovation is a Team Sport

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29 Q: What role is IT playing in innovation at your company?
 CIOs Co-Lead Innovation
Efforts with Business Colleagues

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30 Q: What role is IT playing in innovation at your company?
 Business Strategists Live
Innovation

Q: How much of your role is concerned with bringing ideas for IT-enabled business innovation to the
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31 table?
 IT Budget Allocation
Discretionary vs. Nondiscretionary

36% of the average CIO’s budget can be devoted to providing new capabilities.
Note: percents do not sum to 100 due to range format question structure.
Q: What percent of your total IT budget is devoted to: Non-discretionary items infrastructure,
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32 support and maintenance or Discretionary items new capabilities.
 Innovation is a Significant
Part of the CIO’s Role

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33 Q: How much of your role involves bringing ideas for IT-enabled business innovation to the table?
 And Getting More So…

Q: How has the importance of your role and the role of the IT function in driving or enabling business
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34 innovation changed now compared to 12 to 24 months ago?
 Fewer Business Initiatives
Come From IT Vacuum

Q: Currently, what percent of current business initiatives that are considered “innovations” are driven
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 Business Strategists More
Focused on External
Processes
Q: Which business processes are you Total Function Head Transfrm'l Bus.
currently improving with IT? Leader Strategist
Accounting & finance 71% (1)
73% (1)
69% (1)
70% (2)

Customer service/support 69% (2)

67% (2)
67% (2)
81% (1)

Human resources 54% (3)

51% (3)
57% (3)
54% (5)

Compliance 48% (4)

47% (5)
48% (4)
48%

Asset management/maintenance 43% (5)

48% (4)
39% 40%

Sales 42% 36% 42% 63% (3)

Supply chain/logistics 42% 37% 45% (5)

41%

Order/invoice processing 40% 42% 39% 41%

Marketing 39% 34% 39% 56% (4)

Inventory management 39% 40% 39% 33%

Risk management 38% 39% 39% 32%

Q: Which business processes are you currently improving with IT? Please check
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 Business Priorities:
Relatively
Unchanged
IT Management Priorities 2008 2007 2006

Aligning IT and business goals 1 1 1

IT-enabled process improvement 2 2 4
Business continuity/risk management 3 3 2
Improving internal user satisfaction 4 4-tie 5
Controlling IT costs 5 7 3
IT staff development 6 4-tie 6
IT governance 7 12 11
Revenue-generating services/products 8 9 NA
Measuring and communicating IT value 9 5 12
Improving project management discipline 10 6 7
Data privacy 11 10 8
Regulatory compliance 12 8 10
Scaling IT globally 13 13 NA

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38 Q: What are your top five IT management priorities for the year ahead? Rank top five priorities in order
of importance.
 Technology Priorities:
What’s Up with Wireless?
Technology Priorities 2008 2007
Integrating/enhancing existing systems and processes 1 1
Business intelligence 2 3
Ensuring data security and integrity 3 2
New business services/products (i.e., Web services) 4 4
Collaboration/knowledge management 5 N/A
Enterprise architecture/service-oriented architecture 6 8
External customer service 7-tie 6
E-commerce 7-tie 9
Supply chain automation/visibility 8 10
Data center optimization 9 NA
Identifying/incorporating promising new technologies 10 7
Content/document management 11 NA
Mobile/wireless 12 5
Open source software 14 11

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39 Q: What are your top five IT technology priorities for the year ahead? Rank top five priorities in order of
importance.
 Technology Priorities
by Type
Technology Priorities Function Head Transf’l Business
Leader Strategist
Integrating/enhancing existing systems and processes 1 1 2
Business intelligence 2 2 1
Ensuring data security and integrity 3 3 9
New business services/products (i.e., Web services) 5 4 4
Collaboration/knowledge management 7 5 3
Enterprise architecture/service-oriented architecture 4 12 6
E-commerce 11 7 7
External customer service 12 6 5
Supply chain automation/visibility 10 8 10
Data center optimization 6 10 12
Identifying/incorporating promising new technologies 8 9 8
Content/document management 9 11 13
Mobile/wireless 13 13 11
Open source software 14 14 14

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40 Q: What are your top five IT management priorities for the year ahead? Rank top five priorities in order
of importance.
 Impact of IT – Trends
 Impact of IT in Year Ahead 2008 2007 2006 2005 2004

Enable business innovation 1 1 3 3 3

Improve customer (external) 2 3 2 4 4
satisfaction
Reduce business costs 3 2 1 1 1
Create competitive advantage 4 4 5 2 5
Grow existing revenue streams 5 7 7 6 8
Enable new revenue streams 6 6 8 7 10
Improve security/risk management 7 5 4 n/a n/a
Enable global expansion 8 9 9 8 6
Supply chain automation/visibility 9 10 10 9 7
Enable regulatory compliance 10 8 6 5 9

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41 Q: What impact do you expect IT will have in the year ahead? Please check the three greatest
benefits.
 Impact of IT: Type of
CIO Affects Value
Proposition
Function Transf’l Business
 Impact of IT in Past Year Head Leader Strategist

Reduced business costs 53% 52% 48%

Enabled business innovation 46% 53% 46%
Improved customer (external) 36% 39% 41%
satisfaction
Improved security/risk management 37% 28% 19%
Created competitive advantage 20% 29% 59%
Grew existing revenue streams 24% 21% 27%
Enabled regulatory compliance 30% 20% 11%
Enabled new revenue streams 14% 19% 29%
Supply chain automation/visibility 19% 16% 10%
Enabled global expansion 14% 16% 3%

Q: What impact did IT have on the overall business in the past year? Please check the three
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 Impact of IT:
What’s Ahead for 2008?
Function Transf’l Business
 Impact of IT Next Year Head Leader Strategist

Enable business innovation 47% 58% 65%

Improve customer (external) satisfaction 41% 45% 33%

Reduce business costs 45% 41% 30%

Create competitive advantage 25% 35% 67%
Grow existing revenue streams 30% 28% 25%
Enable new revenue streams 21% 25% 41%
Improve security/risk management 35% 21% 8%
Enable global expansion 20% 16% 17%
Supply chain automation/visibility 18% 17% 10%
Enable regulatory compliance 10% 12% 3%

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43 Q: What impact do you expect IT will have in the year ahead? Please check the three greatest
benefits.
 Impact of IT on the
Business
What impact did IT have on the overall
business in the past year? What impact will it
have in the year ahead? Past Year Coming Year

Enabled business innovation 48% 54%

Improved customer (external) 38% 42%
satisfaction
Reduced business costs 51% 41%
Created competitive advantage 29% 35%
Grew existing revenue streams 23% 28%
Enable new revenue streams 18% 25%
Improved security/risk management 30% 24%
Enabled global expansion 13% 17%
Supply chain automation/visibility 16% 16%
Enabled regulatory compliance 22% 10%

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 Conclusions
• In general, CIO stature continues to grow. That shows
up in compensation, titles, reporting structures and
more.
• There are significant differences in everything from
compensation to priorities to IT’s role in the business
depending on what type of CIO someone is and what
industry they’re in.
• CIOs are increasingly expected to contribute to
business innovation. But many are still focused on
more traditional, operational activities.
• The rewards are great for CIOs who develop leadership
competencies that are more business, market and
customer focused.

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