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Gartner survey finds half of EMEA CIOs participating in a digital ecosystem

Via Gartner Newsroom

Nov 8, 2016

Barcelona, Spain, November 8, 2016

Analysts Examine the EMEA Results of the Gartner 2017 CIO Agenda at Gartner Symposium/ITxpo 2016, November 6-10, in Barcelona

CIOs in Europe, the Middle East and Africa (EMEA) are clearly engaging with the era of digital business, with 50 percent participating in a digital ecosystem* and 65 percent contacting startups to acquire key digital technology capabilities and skills, according to Gartner, Inc.’s annual CIO survey.´

Gartner analysts presented these findings during Gartner Symposium/ITxpo, which is taking place here through Thursday. The 2017 Gartner CIO Agenda Survey gathered data from 2,598 CIO respondents in 93 countries and all major industries, representing approximately $9.4 trillion in revenue/public-sector budgets and $292 billion in IT spending. 753 CIO respondents were from the EMEA region.

"EMEA CIOs expect their enterprise IT budget to increase 1.4 percent, on average, in 2017 — the smallest increase of any of the world's regions — but, despite this, spending on digitalization in EMEA is on the rise," said Andy Rowsell-Jones, research vice president at Gartner. "EMEA CIOs are spending an average of 19 percent of their enterprise IT budget on digital initiatives, a figure set to increase to 29 percent in 2018. Their investments in digitalization include key technologies for traditional digital marketing and digital sales channels, advanced analytics, the Internet of Things, enhanced digital security solutions, and business algorithms and learning machines."

A Digital Ecosystem Rises

"Digitalization is maturing, and as it does, it's likely that organizations which are investing in digital business will become part of a digital ecosystem," said Mr. Rowsell-Jones. "Many will need to move away from a linear, value-chain-based business model, in which they trade with well-known partners and add value in stages, to become part of a faster and more dynamic networked digital ecosystem."

As digital business takes center stage for EMEA CIOs, it's not only their participation in a digital ecosystem that is growing.

"They are also increasing the number of digital partners they work with, from an average of 63 today to an expected 127 in 2018," said Mr. Rowsell-Jones.

Ecosystems support business models that enable organizations to achieve performance superior to that of businesses that operate independently.

"EMEA CIOs have clearly understood that by increasing the number of partners in your ecosystem, you extend your company's reach and deliver greater business value," he added.

Twenty-eight percent of EMEA CIO respondents identify digitalization as their No. 1 business priority for 2017. This percentage is higher than those of their counterparts in other regions; it compares with 11 percent for North American respondents, 21 percent for those in Latin America and 22 percent for those in Asia/Pacific.

"EMEA CIOs' interest in digitalization focuses on initiatives such as 'Industry 4.0', the European eGovernment Action Plan, the relative sophistication of financial technology in EMEA, and the extensive digitalization of solutions and services in industries such as transportation, logistics and retail," said Mr. Rowsell-Jones.

From a technology perspective, business intelligence (BI) and analytics remain the top investment priorities of EMEA CIOs. This is in line with their main business priority for 2017. "Analytics are crucial to customer, citizen and user engagement. They also underpin the mediation and value exchange that occurs in a digital ecosystem," added Mr. Rowsell-Jones.

Adoption of Bimodal IT Is Increasing

Increased adoption of bimodal IT practices is of paramount importance for boosting digital performance. EMEA CIOs have made progress in this regard. In 2015, 39 percent of those surveyed had bimodal IT, and this figure has risen to 41 percent this year. Bimodal IT offers great benefits: for 64 percent of the respondents, it's bringing business and IT groups closer together, and for 52 percent it's improving the perception of IT.

Talent Shortage Remains Biggest Problem for EMEA CIOs

For CIOs whose organizations participate in a broad digital ecosystem, the most common challenge is to find the right talent.

"Twenty-six percent of the EMEA CIO respondents — a rise of nine percentage points from 2015 — consider finding the right skills and resources is the biggest barrier to successful execution of their job," said Mr. Rowsell-Jones.

The largest talent gaps remain in the areas of information/analytics and digital business.

"Some organizations have shifted the focus of their business to software engineering, and one challenge facing them in particular is that planning horizons for finding, acquiring and retaining talent tend to be too short. With 59 percent of talent planning being for less than one year, companies that are feeling the effects of the talent shortage probably failed to plan far enough ahead," Mr. Rowsell-Jones.

CIOs should create a leadership action plan that's ready for a digital ecosystem.

"It's most important to form get a clear understanding of your current leadership situation, to devise a realistic plan for improving it, and to select a few areas of focus in which to progress," concluded Mr. Rowsell-Jones.

Related Topics
  • Device Software & Apps,
  • Digital Platforms & Services,
  • Enterprise,
  • Europe,
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