Leading businesses must shift to platform thinking in terms of their business models, delivery mechanisms, talent and leadership, in order to survive and thrive, according to a global survey of CIOs by Gartner, Inc. The survey showed that as the implications of digitalization play out, it is becoming clear that hardcoded business and operational models will not suffice and that a more adaptable approach is required.
Gartner analysts presented these findings during the sold-out Gartner Symposium/ITxpo, which is taking place here through Thursday. The worldwide survey gathered data from 2,944 CIO respondents representing more than $250 billion in CIO IT budgets in 84 countries. The Gartner report, "Building the Digital Platform: The 2016 CIO Agenda," represents the most comprehensive examination of digital business opportunities and threats, and CIO strategies to address them.
Data from the 2016 CIO Survey shows that the average CIO expects digital revenue to grow from 16 percent to 37 percent of total revenue in the next five years. Similarly, public-sector CIOs are predicting a rise from 42 percent to 77 percent in digital processes. While the meaning of digital revenue and processes is open to interpretation, it is clear that digital business is a reality now, and it is expected to be a significant aspect of achieving competitive advantage and differentiation using information and technology.
"We are now knee-deep in the era of digital business, with many companies reimagining their business and operating models based on digital capabilities," said Dave Aron, vice president and Gartner Fellow. "Businesses and government agencies are looking less like fixed "systems" and more like platforms. A platform provides the business with a foundation where resources can come together — sometimes very quickly and temporarily, sometimes in a relatively fixed way — to create value."
"Leading economists have noted the increasing prevalence of platform business models, where multiple networks of stakeholders bring value to each other by exploiting network effects," said Graham Waller, research vice president at Gartner. "Technologists have long recognized the power of platform approaches to information and technology architecture. What is new is that platform dynamics are being applied to create value in all aspects of the business."
Create a Bimodal Delivery Platform
In 2014, Gartner said that it is essential to have two modes of IT, and ultimately of the entire business, to deal with both predictable and exploratory work. Two years later, the 2016 CIO survey found that almost 40 percent of CIOs are on the bimodal journey, with the majority of the remainder planning to follow in the next three years. The evidence is that building a mature bimodal platform results in much better digital strategy performance. Furthermore, the survey data suggests that one of the worst things a CIO can do is to delay bimodal. Those who are planning to move toward bimodal, but have not taken steps yet, came out worst in terms of digital strategy performance.
Evolve the Talent Platform
According to the survey, 65 percent of CIOs believe there is a talent crisis in the world, and yet there is surprisingly little talent innovation. Since virtually all stakeholders recognize the issue of talent as the biggest barrier to success, Gartner believes that talent must also be treated as a platform.
"It is time to think of talent as a platform and innovate with it. CIOs must look at digital talent beyond the boundaries of the IT organization, and indeed beyond the boundaries of the enterprise," said Mr. Aron. "Innovative talent management opportunities abound and include getting closer to universities by helping define and deliver courses and projects, performing reverse mentoring and implementing job rotations. CIOs should also think of their partners as extensions of the talent pool."
Build a Leadership Platform
The survey found that nearly 40 percent of CIOs are the leaders of digital transformation in their enterprise, and more than 30 percent are the innovation leader. The survey also showed that penetration of the chief digital officer role has stalled at 9 percent, the same as last year. The results show that CIOs are being given the opportunity to lead digital transformation, but they must adapt their leadership style to exploit platform effects in leadership, building a network of digital leadership inside and outside the enterprise.
"Of course, not all businesses and government agencies are becoming platform businesses in terms of industry dynamics, either today or even in the near future," said Mr. Aron. "However, to remain competitive, all businesses need to understand and exploit platform effects throughout the business. If platform effects are not considered in any aspect of the business — such as leadership, talent or delivery — this represents a bottleneck in the enterprise's ability to deliver, attract and retain talent, and to ultimately be perceived by customers as adding value. CIOs must build a plan to evolve all layers of their business's digital platform."
About Gartner Symposium/ITxpo
Gartner Symposium/ITxpo is the world's most important gathering of CIOs and senior IT executives. This event delivers independent and objective content with the authority and weight of the world's leading IT research and advisory organization, and provides access to the latest solutions from key technology providers. Gartner's annual Symposium/ITxpo events are key components of attendees' annual planning efforts. IT executives rely on Gartner Symposium/ITxpo to gain insight into how their organizations can use IT to address business challenges and improve operational efficiency.
Video replays of keynotes and sessions are available on Gartner Events on Demand. Follow news, photos and video coming from Gartner Symposium/ITxpo on Smarter With Gartner, on Twitter using #GartnerSYM, Facebook and LinkedIn.
Upcoming dates and locations for Gartner Symposium/ITxpo 2015 include:
October 19-22, Sao Paulo, Brazil
October 26-29, Gold Coast, Australia
October 28-30, Tokyo, Japan
November 2-5, Goa, India
November 8-12, Barcelona, Spain