2024 CIO Competing Priorities

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Apr 23

According to the 2024 State of the CIO Report by Foundry, 75% of CIOs find it challenging to strike the right balance between these two critical areas. This difficulty is notably higher in sectors such as education (82%) and manufacturing (78%), and less so in retail (54%). Despite a strong focus on modernization and optimization, 49% expect to play a more strategic role in the coming years, driven by AI and data analytics. Security remains a top concern, with 48% emphasizing increased cybersecurity. While 88% of CIOs are becoming more digital and innovation-focused, they still dedicate significant time to functional responsibilities. This evolving role underscores their critical position in driving both business transformation and maintaining existing infrastructure.

Why this challenge exists

The increasing emphasis on digital transformation and artificial intelligence (AI) is driving the need for innovation. In 2024, 28% of CIOs reported that their primary CEO-driven objective was to lead digital business initiatives, a significant increase from the previous year. This push towards innovation often competes with the imperative to maintain operational excellence, including upgrading IT and data security and enhancing IT-business collaboration.

The impact on the organization

The tension between innovation and operational excellence can lead to a misallocation of resources if not managed correctly. It can result in either stifling innovation due to overemphasis on day-to-day operations or risking operational integrity by over-prioritizing disruptive technological advancements. For instance, sectors with a high focus on operational challenges, such as education and healthcare, particularly emphasize IT security and business alignment over aggressive innovation.

My advice for CIOs

Embrace a dual agenda: Get used to it! CIOs should advocate for an IT strategy that equally prioritizes operational excellence and innovation. This involves not only leading digital transformation projects, but also ensuring that these innovations deliver tangible business outcomes without compromising the operational integrity of the organization.
Strengthen business and IT collaboration: Strengthening the collaboration between IT and other business units remains a top priority. CIOs should work closely with business leaders to ensure that technological initiatives are well-aligned with business goals, thereby enhancing the overall strategic impact of IT.
Develop a flexible IT resource allocation model: To manage the dynamic demands of both innovation and operational tasks effectively, CIOs should adopt a flexible resource allocation model. This model would allow the IT department to shift resources quickly between innovation-driven projects and core IT functions, depending on the business priorities at any given time.