Far from things like ‘implementing and updating business applications’ (Business Priority #6 for 2011), when we talk to CIOs their real priorities tend to be things like ‘keeping my job after that security fiasco’, ‘finding a new job where budget isn’t shrinking each year’, or perhaps more business-centric things like ‘building a leadership team that can support me properly’ or ‘convincing my suppliers to cut their costs again’.

Perhaps someone should pick up David Cameron’s ‘Gross National Happiness’ theme and try to research what really makes CIOs tick and how to make them happy?

But the big trends that this research picks up do offer a couple of interesting angles to marketers:

1. All the business priorities are very optimistic-sounding. But the ‘fear’ equivalents could actually be more useful to us in capturing a decision-maker’s attention. So rather than the carrot of ‘Attracting and retaining new customers’ we would raise the danger of ‘Losing wallet share to new market entrants’. Sounds simple, but putting a bit more ‘provocation’ into the propositions can be more effective than always selling on ‘hope’. It’s definitely an opportunity to stand out from all the vendors who pick up on the priorities and parrot them back to the decision-makers.

2. There will be useful observations to draw by comparing different answers in the full research. Just one example that suggests itself from the summary findings would be that Gartner claim Cloud Computing is advancing faster that previously thought. Cloud Computing and Virtualisation are the top two technology priorities for 2011. The combination of these results (moving faster than expected but still at the top of the priorities) suggests that decision-makers will be on the hunt for detailed information and support to turn the priority into a reality. There will be a lack of success stories readily available to companies looking to go into the Cloud – so client references, site visits, and even case studies/customer interviews will be massively useful. And – picking up on the point above – any fear messages about areas that CIOs might have overlooked or potential causes of project failures will probably be enough to merit their attention (just make sure you have a good antidote to the fear!).

So what are the investments they’ll be making? Broadly speaking, the summary confirms what you might already expect. Gartner have some hard facts about the move to cloud infrastructure, software and services. Almost half of all CIOs expect to have the majority of IT running in the cloud over the next four years (from just 3% now).

IT Management is an interesting one (the fourth technology management priority). Improving the professionalism of the IT Department and the ability to track performance and results from investments is going to be of increasing importance as IT lays claim to be more business-focused (not to mention as a diverse portfolio of projects and software in the cloud needs a closer management eye). In fact, whatever the proposition, messaging that emphasises how an investment can be managed and ROI tracked will be essential to getting to the top of the pile for Finance sign-off.

In terms of business priorities, operational efficiencies are still important but have been overtaken this year by growth considerations (broadly speaking, 2 of the top 5 business priorities are about improving efficiency, while the other 3 are about creating growth).

The top 10 Business and Technology priorities:

So now you know!

When you consider that Matula is talking about IT transformation that has been going on for a decade (and is now looking for payback over at least 15 years from, for example, a new standardised HR system), it becomes clear why the long-term approach is the only one to take.

He talks through the different phases of the transformation, and what comes across most strongly is a ruthless focus on reaching a successful outcome. When it comes to selecting suppliers, it’s clear that only those most able to sign up to the corporate vision have been selected:

“We started with the idea that we wanted 70 percent of our spending to be external. Of that, we wanted 80 percent to be focused on the top 11 suppliers. We put those 11 into three groups: First, there are the foundation suppliers, those in which we make long-term bets—Cisco, Microsoft, Oracle, and SAP. Then there’s the infrastructure group, with three bundles—AT&T, HP, and T-Systems—for networks, end-user computing, and hosting of storage, respectively. And finally we have four application services suppliers—Accenture, IBM, Logica, and Wipro. What we’re doing differently is bringing all 11 of them together to work as a collective.”

It will be interesting to revisit the performance of this collaborative approach after a couple of years working. Shell is already noticing that traditional product/service divisions between suppliers are breaking down (movements like cloud computing and shifting to pay per performance models are exacerbating this at the higher level).

Matula’s closing comments illustrate 3 of his most significant priorities. Being able to measure the impact that IT has on the business. Having the skilled people available to manage relationships (internally and with key suppliers). And finally, avoiding failure at all costs – risk aversion is still top of the list.

“IT is more important and intense to the enterprise than ever before, and that essentially requires an ongoing effort to transform IT; there is always another phase. To support that mental model, the first thing is to never lose the perspective that you’re here to make the business more productive and more competitive. Our catchphrase, “business at the center,” keeps us grounded. Our position today is a reflection of the tight integration that we have with the business, combined with the efforts of key support functions like HR, finance, and procurement.

A second thing is that you’re only as good as the talent that you have. For instance, in the robust sourcing of infrastructure and applications we have put in place, the people at the interface are very important. They manage the critical supplier relationships with CEOs and top executives at these firms, and they have the technical know-how to help guide the suppliers.

Finally, if you don’t have the basics right, you won’t have any credibility. It only takes one bad “go live” on a project or a flaw in your basic delivery capabilities to set you back very quickly.”

The first article is a brief ‘day in the life‘ – the kind of piece that’s always worth bearing in mind in planning techniques that could realistically fit within a decision-maker’s daily routine. It’s interesting to see further proof of our own research into the challenges of persuading senior contacts to attend events. We found that senior decision-makers receive an average of one invite every day but only attend 5 in a whole year – meaning that the content, topic and invitation process has to be spot-on. Tiffany seems to be at around the average for invitations but above average for attendance!

“Evening I have been invited to more work dinners since I started this job than the entire rest of my career. I could be dining out every night of the week.”

The second, longer, article goes into more details around current BBC IT challenges and priorities. It discusses some of 2010’s headline issues of information management, standardisation and consumerisation of IT, and also references some of the ‘day to day’ projects that seem to be rising up CIO agendas this year:

“We have reached the stage in the lifecycle of our legacy business systems when we are having a good, long, hard look at that and seeing whether now is the time to divert some of our priorities back into the business systems infrastructure…This hasn’t been a great focus for my predecessors over the last few years, simply because of where the BBC’s priorities were. I am getting a very clear steer from my stakeholders out there in the BBC business that, much as they want to put the money into costume dramas and all the rest of it, we do need some better back-office functions. Traditional back-office stuff around Outlook, when are we going to Windows 7… all of that stuff is very much on the radar.”

It’s hard to draw significant suprising trends from the list – public sector largely moving up the list, banks still near the top but slightly down, sectors like construction and retail taking a hit…

Where the list is particularly interesting is in the detailed profiles of each organisation’s IT strategy/performance/existing infrastructure. There are also some specific examples of popular projects for the year:

“Many were considering overhauling their communications networks to support either voice over IP or unified communications. Upgrading Microsoft Office and operating systems was also high on the list of tasks, as were improvements to e-commerce and customer management systems.”

It’s valuable information; now the question becomes how you best use this insight to support decisions/activities focused on these organisations. (You might also ask, assuming all the compeition will be targeting the top 100, how you get hold of the names of the organisations that came 100-150 on the table…)

However, when looking to communicate with, and ultimately build relationships with, this particular beast a few points made in the white paper really resonated:

“The CIO is an idea position to take increasing business responsibility and control.”

“It’s one of the most dynamic and creative roles in a modern company.”

“CIOs are on the way to becoming tomorrow’s CEO”

“Key skills of today’s CIO include the ability to translate Board requirements into solutions. He needs to talk the language of the Board and the investors.”

“All innovation in our industry will be technology-led or technology facilitated.”

All of the above suggest that while the CIO no longer has to “sell the IT philosophy”, he or she is expected to be able to lead people, lead technologically and have acute business acumen. As Acergy’s CIO says in the report “tomorrow’s CIO must have the proficiency to be heir apparent to any senior executive position.” It stands to reason therefore, that the CIO of now and the future will want access to people and content that will satisfy their needs to contribute at the boardroom table.

The white paper suggests that the CIO will need to “understand the possibilities of the future” – any communications programme aiming to paint that picture more clearly for the CIO is at a distinct advantage.

Interviews are, among others, with the CIOs/CTOs of Waitrose, Wincanton, Network Rail, Dundee City Council, O2 and HSBC. They are downloadable as separate PDFs and provide good insight into the challenges in each of these accounts. We’ll be commenting on the umbrella “Evolving Role of the CIO” report in our next post.

Writing on his blog, ITSMA spokesman Chris Koch said that ITSMA’s annual survey of buyers of complex IT solutions (entitled How Customers Choose Solution Providers, 2009: The Importance of Personalization, Epiphanies, and Social Media), “shows that the door to the C-suite is opening up”. You can download a free summary of the research here but the full piece costs.

The research Chris quotes found that usage of social media among IT and business buyers of technology rose 50% over last year. Now 55% of respondents said they use social media as part of the technology buying process in 2009 versus just 37% in 2008.

The research also found that C-suite executives used social media more than their lower-level buying peers. Just 15% of CEOs and directors said they did not use any form of social media at all, while 34% of manager/directors and 26% of VPs/Assistant vice presidents said they do not use it.

Commenting on these findings, Chris says “This has big implications for marketers. It means that social media is taking hold within your biggest, most valuable accounts at the highest levels. Sounds like a business case for investment to me.”

My stance on this would be that any social media strategy has to be woven into a wider business case for C-level contact.

Are C-suite execs using LinkedIn or Facebook to keep in touch with peers and ask for advice – yes, they are. Are they making decisions solely on the basis of this information? Our experience suggests that’s simply not the case. Designing a business case for social media investment on a standalone basis is pretty risky – you are in danger of embarking on a non-integrated programme that very likely cannot survive without supporting communications. Think instead, what do you want to say to these execs, and how can social media be used to best effect in the series of communications you’re going create over the long-term.

For those marketing to CIOs, the study points to contined unpredictable conditions  – 90% of the CIOs interviewed believe that there’s moderate or substantial change ahead for them. The top 3 factors driving this belief were agreed to be business model changes, budgets and macroeconomic factors.

Other major findings are that CIOs split their time between 3 main activities – making innovation real, raising the ROI of IT and expanding business impact. The levels to which they spend time on these depend very much on whether those CIOs work for high, medium or low growth organisations. 10 minutes spent reviewing the numbers in detail is worthwhile as there are some useful nuggets – the heavy usage of collaboration tools in the high growth environments is one. Another is the fact that all CIOs are seeing that IT is “key to making business models unique and difficult to imitate.” The relentless march of SaaS is obviously not causing a “utility” situation to arise just yet!

CIOs are spending their time now and in the medium term on plans that enhance competitiveness (83%) and virtualisation (76%). They are also highly focused on “making the data sing” – interrogating data to support decision making – especially around new ways to meet customer need. The unpredictability to the customer in the recession has clearly put a lot of pressure on IT to use data to reveal what they might do next.

For many marketers, one of the study’s most interesting findings is the conflict that’s increasingly inherent in the CIO’s role. Many of the verbatims and case studies draw this out… “I need to introduce new services without disrupting existing ones”… “I need to reduce costs and improve services”. It strikes me that acknowledging this in marketing material, and offering ways that these dichotomies could be resolved, might be one way to strike a chord with CIOs.

But in the background, buyers are creating specific plans for the elements of the cloud they want to use now. What vendors really need are some focused examples of problems their solutions can solve, not high level positioning of where they fit amongst SaaS, IaaS, PaaS…

Perhaps more significantly, all this talk of ‘as a service’ is starting to extend to non-cloud conversations and contracts. The FT’s recent article, Outsourcing begins to blur into services, shares a range of views on providing more flexible pricing and resourcing models on wider IT Services contracts. In an interesting section 3/4 of the way through the article, there are some good CIO viewpoints:

Simon Post, CTO at Carphone Warehouse: “Flexibility is vital to us, not just in the infrastructure space, with IBM, but also for applications. Retailers have shorter buying cycles than other businesses, so we do need to gear up and gear down quickly.” According to the article, “Buying IT services on a pay-per-use basis is certainly on the agenda at Carphone Warehouse”.

Richard Boynet, CIO at Electrocomponents: “when our current data centre contract runs out, we are looking at multiple options from virtualisation, to taking some of that [capacity] as a service. We might, for example, use a vendor such as Amazon to stress-test the next release of our main IT systems.”

So to summarise, by the start of 2010, if you have a cloud offering you will need the specific examples of where people can use it (which may sound obvious, but is currently surprisingly thin on the ground). And even if you are keeping your head above the cloud (sorry), you will still be coming up against competitors for traditional services who have developed some model for ‘pay as you go’ pricing that could be opening doors for them in your client base.

Until now, there has tended to be agreement that pricing is more of a hygiene factor than a compelling component of a proposition (with clients more interested in any existing relationship, proof of past delivery, or promises of helping them to achieve large savings). But is the rise of cloud propositions making the pricing strategy of traditional services a more decisive issue? How can suppliers build more flexibility (not just performance-related elements) into their offerings?