Technology & Innovation

IT’s changing mandate in an age of disruption

September 14, 2021

Global

IT’s changing mandate  in an age of disruption

September 14, 2021

Global
Jeremy Kingsley
Senior Editor, The Economist Intelligence Unit

Jeremy is a managing editor at the Economist Intelligence Unit based in London and regional lead of the The EIU's Technology & Society practice in Europe, the Middle East and Africa. He leads a regional team of analysts and editors on policy research, consulting and thought leadership programmes exploring technological change and its impacts on society. He joined The EIU in 2017 from Nesta, the innovation foundation, where he oversaw the Challenges of Our Era research programme on grand challenges. He previously edited Nesta's magazine, served as a contributing editor at WIRED, and has spent more than ten years covering technology and innovation as a journalist and researcher for The EIU, The Economist, The Financial Times, Slate, and others. He studied at Trinity College Dublin and the London School of Economics.

Sudden, widespread lockdowns triggered by the onset of the covid-19 pandemic in early 2020 thrust IT leaders into the spotlight. CIOs and their teams faced the dual challenge of ensuring business continuity by facilitating the shift to remote working, while launching new digital customer engagement channels to meet demand.

Covid-19 forcibly accelerated companies’ digital transformation plans. However, against this backdrop, IT departments have often found themselves side-lined from digital transformation decisions. Exacerbating a trend that predates the pandemic, siloed, distributed teams within organisations have increasingly made their own choices over new tools, technologies and digital strategies.

With the focus now on business recovery and renewal, the IT function will need to forge a new role for itself based on its ability to deliver business resilience for the long term. To better understand this role and what it means for the ways in which IT leaders and their teams interact and collaborate with the rest of the business, The Economist Intelligence Unit, supported by Appian, conducted a global survey and a series of in-depth interviews with both IT decision-makers and senior business executives at major corporations. Our research finds that:
 

  • The pandemic has shone a harsh light on the shortcomings of existing IT systems. More than four in five respondents (83%) believe that their organisation needs to improve IT infrastructure and applications to weather future shocks.
  • Capacity is a significant source of apprehension. On average, firms are dealing with a backlog of 3-12 months for planned IT projects, and the situation is worsening as business project demand outstrips IT budget growth.
  • IT teams’ control over their organisations’ digital infrastructure and strategy is slipping. At more than half of the companies surveyed (55%), business units already do more than IT to procure or develop new applications. Moreover, 53% of business decision-makers believe the volume of applications built or sourced by non-IT business units will increase over the next 12 months. Business decision-makers are also more likely than IT decision-makers to perceive ownership over critical systems to be equally shared by IT and non-IT departments, suggesting tension over the role of IT teams.
  • IT teams’ control over their organisations’ digital infrastructure and strategy is slipping. At more than half of the companies surveyed (55%), business units already do more than IT to procure or develop new applications. Moreover, 53% of business decision-makers believe the volume of applications built or sourced by non-IT business units will increase over the next 12 months. Business decision-makers are also more likely than IT decision-makers to perceive ownership over critical systems to be equally shared by IT and non-IT departments, suggesting tension over the role of IT teams.
  • Collaboration between IT and non-IT teams is strong, but many believe that their organisations would benefit if collaboration was stronger still. Data is an area of particular strain. New product development and customer experience are areas where both sides praise each other’s collaboration capabilities, but there is more divergence when it comes to data privacy and protection. Three quarters (75%) of business decision-makers state that, when procuring or creating new applications, they prefer to keep data where it is rather than move it to new repositories. Six in ten (61%) report having to cancel a digital project for lack of the right data. 
  • The technologies seen as most important to the success of organisations over the next 12 months are cloud computing, AI and machine learning, data science and analytics, and automation. These must be treated as priorities for improved IT/non-IT collaboration.
  • Executives have mixed views on skills. Contrary to expectations, four in five executives (80%) say that they have enough talent to support their next-generation AI and/or machine learning projects. However, 71% of respondents report that relatively few of their applications have AI and/or machine learning capabilities, and more than half (57%) report that robotic process automation (RPA) projects often fail. 

Receive forward-looking perspectives from our editors - Subscribe now for our Weekly Digest