The Digital Enterprise and Beyond

March 17 19, 2013 Huntington Beach, CA gartner.com/us/cio The Digital Enterprise and Beyond TRIP REPORT The Gartner CIO Leadership Forum 2013 was held March 17 19 at the Hyatt Regency Huntington Beach Resort & Spa in Huntington Beach, CA, outside of Los Angeles. This report summarizes and provides highlights from the event. Overview More than 300 CIOs gathered at Gartner CIO Leadership Forum 2013 to discuss the theme Digital Enterprise and Beyond. The agenda focused on the digital theme, along with technology trends and associated leadership needed for businesses to survive and thrive in an increasingly digital context. The forum provided CIO attendees a networking-focused environment to share their experiences, ideas and concerns. In addition, they validated their strategies with more than 20 Gartner analysts and executive partners along with leading technology providers. The leadership forum was timed to follow the release of the 2013 Gartner CIO Agenda Survey results, lending unparalleled insight and leadership building. Thank you to all the CIOs who took some time out to explore how to act on digital opportunities now to create value for the enterprise. It is always a pleasure to work with you individually and as a community of business leaders. Mark P. McDonald Group Vice President and Gartner Fellow Gartner Executive Programs Heather Colella Director Gartner Research SAVE THE DATE Gartner CIO Leadership Forum 2014 will take place February 23 25, in Phoenix, AZ, at the JW Marriott Desert Ridge Resort & Spa. Be sure to bookmark gartner.com/us/cio and check back for 2014 conference updates. Table of Contents 2 Reflections From the Conference Chair 6 Keynote Sessions 7 Reflections From Analysts and Executive Partners 8 Snapshot of Attendees 9 Sponsors 10 Post-Event Resources 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. For more information, email info@gartner.com or visit gartner.com. 1

March 17 19, 2013 Huntington Beach, CA gartner.com/us/cio Reflections from Mark P. McDonald, Conference Chair, Group Vice President and Gartner Fellow Significant potential remains for enterprises to use technology. For almost half of the CIOs attending this year s North American event, their enterprises have realized less than 20% of technology s potential (see figure below). This is well below the global average of 43% from the 2013 Gartner CIO Agenda Survey. During the Gartner CIO Leadership Forum 2013, held March 11 13 in London, 55% of CIOs polled realized less than 20% of technology s potential in their enterprises. How much of technology s potential has the enterprise realized? (0% = Lowest, 100% = Highest) CIOs in attendance felt that only 20% of technology s potential is being realized in their enterprises. 81% to 100% 1% 61% to 80% 6% 41% to 60% 16% 21% to 40% 27% 1% to 20% 47% 0% 3% 0% 10% 20% 30% 40% 50% N = 206 Source: Poll of attendees at Gartner Leadership Forum 2013, March 17 19, Huntington Beach, CA Why is the number so low? The introduction of digital technologies, also known as the Nexus of Forces, is expanding the range of technology possibilities. If more things are possible, then the realization of those possibilities will shrink. As technology s potential grows, IT s capacity to deliver that technology has declined in the face of a decade of CIO IT budget devaluation, skill gaps and uneven business demand. The simple reason for a low rate of realization is that for many, cost realization has been more important than realizing business capability (see chart opposite). 2

What is apparent, however, is that traditional barriers of organizational readiness for new technologies or enterprise change have become less important in both Europe and North America. CIOs and IT can no longer assign blame to a business that is readily adopting digital technology often in the form of shadow IT (IT activity that occurs outside of IT) or working with greater agility. Those arguments are increasingly less common or potent. CIOs in North America are aggressively hunting for digital innovation. The 2013 Gartner CIO Agenda outlined three behavior profiles for CIOs and IT: tending, hunting and harvesting. Those attending Gartner CIO Leadership Forum 2013 appear to strongly favor hunting for digital innovation (see figure below). Which role describes the majority of your work for the coming year? 17% Harvesting for business results 34% Tending to current operations and concerns 49% Hunting for digital innovation and opportunity N = 222 Source: Poll of attendees at Gartner CIO Leadership Forum 2013, March 17 19, Huntington Beach, CA Half of CIOs attending the event see hunting as the role that describes the majority of their work for the coming year. That figure is 10 points higher in North America than it was in Europe where, according to polls at the London CIO Leadership Forum, tending to current operations dominated at 48%. While North American appetites for innovation may be greater than in Europe at the present time, CIOs in both regions are underplaying the single reason why you have IT business results. 3

March 17 19, 2013 Huntington Beach, CA gartner.com/us/cio It s no wonder CIOs give low estimates of technology realization, when almost all of them are ignoring harvesting, the behavior that raises technology realization. Harvesting is a remote activity for CIOs, undertaken by 14% of CIOs in London and 17% in North America. Yet it s the behavior that is focused on raising business performance. CIOs can easily squander their resources by standing firm with current solutions (tending) or chasing digital opportunities (hunting), but they earn a return based on how well they harvest. Too few people are concentrating on that critical role. CIOs see their future success in doing new things. Given the results of these two polling questions, the responses to the final question were not surprising. When CIOs were asked which type of activity they thought would be most important to their success in 2013, the answer was clear: doing new things (see figure below). (0% = Lowest, 100% = Highest) 70% 60% 50% 61% 40% 30% 20% 10% 0% N = 209 11% 14% 14% Do New Re Do Undo Don t Do Source: Poll of attendees at Gartner Leadership Forum 2013, March 17 19, Huntington Beach, CA 4

Doing new things should create new or different results. That simple logic new activities equal new results makes sense on the surface, but it belies a weakness in IT. With 61% of CIOs concentrating on doing new things, the real question is, what stops in order to start new things? Based on the responses, the answer is perhaps nothing, which means that CIOs are accretive leaders: those who allow individual changes to build up, one on top of the other, with little consideration of the cumulative effect of change. This presents a challenge, since most CIOs don t have additional funding to support more activities. This means that something has to give, and too often it has been quality, time or our people in IT. CIOs can rationalize this in a world where controlling cost is the game. But when the business expects results and expects technology to support growth and innovation, the bar is much higher and the consequences more severe for everyone. CIOs need to reform the IT organization. They need to reunite it with the business rather than just throwing another project on the fire, introducing a new technique or tool into the organization, or making commitments it can only partially keep. That may have worked in the past, but it will not work in the digital decade. When CIOs were asked which type of activity they thought would be most important to their success in 2013, the answer was clear: doing new things. Today s CIOs are embracing the challenge of the digital enterprise and beyond. Despite these findings, CIOs contributing to Gartner CIO Leadership Forum 2013 in Huntington Beach reflected a sense of optimism, opportunity and focus. In the digital world, creating a digital edge requires more than implementing and operating technology: It involves transforming business, technology and the people, which raises new issues, complexity and leadership challenges. The leadership forum initiated, through workshops, presentations and interactive networking, how to lead in the future. Inspired by Candy Chang s TED talk, the CIO Leadership Forum s My legacy as a digital leader will be blackboard. 5

March 17 19, 2013 Huntington Beach, CA gartner.com/us/cio Keynote sessions Leaders Make the Future: How Can You Develop the Skills to Thrive in the Next Decade? Bob Johansen introduced the external future forces looking 10 years ahead globally that will have the most profound impact on leaders, especially CIOs and those leading with technology. He focused on disruptions, not just trends. Johansen explored VUCA (volatile, uncertain, complex and ambiguous) and helped attendees understand the future leadership skills that will be necessary to be ready and to thrive. Bob Johansen Author and Distinguished Fellow, Institute for the Future Digital Business and Beyond: The 2013 CIO Agenda CIOs knew what success looked like for IT: managed cost, complexity and risk to enable business operations. But the world has changed, and digital technology and economic conditions have created a quiet crisis for IT. CIOs know that the future rests not in repeating the past, but in extending IT s performance profile and relevance by hunting and harvesting in a digital world. This keynote session covered the business trends driving the digital world, the CIO strategies responding to those trends and the digital technologies that will drive the future. Mark P. McDonald Group Vice President and Gartner Fellow, Conference Chair Race Against the Machine Andrew McAfee brought together engineering, computer science, economics and strategy to show how technology is racing ahead yet leaving many people, companies and institutions behind. We are in the early stages of the next chapter of economic history. This will be a time of great progress and abundance, but there is no guarantee that all of the coming benefits will be widely shared. McAfee highlighted the opportunities and challenges of our new machine age. Presentations for these Gartner keynotes are now available on Agenda Builder at gartner.com/us/cio. Andrew McAfee Principal Research Scientist, Center for Digital Business, MIT Sloan School of Management 6

Key reflections from Gartner analysts and executive partners 9 10 Are the leadership skills you have the ones you need? Attendees explored this question, and the answer was far from affirmative a somewhat uncomfortable finding, given the rapid ascent of the digital enterprise. Leadership shifts identified in the workshops included moving from command and control to enable and empower. While one CIO observed that We have been talking about these types of changes for 30 years, the sentiment in the workshops was that we face a genuine tipping point. If CIOs don t make the needed leadership shifts, there is danger that the immense opportunities to be derived from digital macro trends will disintermediate the traditional IT role itself. CIOs who master these leadership skills to drive digitally enabled business outcomes will be in demand and rewarded with additional business responsibilities, including the emerging chief digital officer (CDO) role. Big data is becoming more complex internally (structured data) and externally (unstructured data). The sheer volume is staggering, and finding the power and talent to hunt and harvest it will be a real challenge. Attracting and retaining talent was ranked No. 8 on the 2013 Gartner CIO Agenda Survey. In 2012 it also ranked No. 8; in 2011, No. 12; in 2010, No. 4; and in 2009, No. 3. It may have dropped in priority, but it was still one of the biggest pain points heard at the event. In the education workshop, the concept of digitalization resonated well with attendees, inspiring them to explore more ways to connect existing and new digital resources. Several education CIOs presented their digitalization projects that are leading to more automation of content delivery, increasing student engagement and learning. In education, digitalization goes beyond the university level: It includes their partners, open Web resources, and grades K-12, community colleges and other education providers. The next generation of business leaders will reflexively engage with social media. Building social capability now will pay off later as these leaders become an increasingly important part of the workforce. In the healthcare workshop, key take-aways included involving the patient, creating patient-unique identifiers as a national standard and improving patient engagement. Top 10 analyst one-on-one topics 1. Analytics/big data 2. Business process improvement 3. Business and IT alignment 4. Cloud 5. Digital business or marketing strategy 6. Innovation 7. Mobility 8. Leadership role of IT organization 9. Outsourcing 10. Service catalog 7

March 17 19, 2013 Huntington Beach, CA gartner.com/us/cio Snapshot of attendees Who participated in the 2013 conference? Industry Sector 25% 20% 15% 11% 10% 5% 0% Banking, finance and insurance 21% 4% 6% Education Energy and utilities 16% 8% Government Healthcare Manufacturing 1% 2% Media Miscellaneous 3% 13% 13% Retail Services Technology and telecom 1% Transportation Company Size 20% 15% 10% 5% 0% 7% 16% 12% 14% 14% 17% Unknown Small Less than $50 million 1 to 749 employees Medium $50 to $249 million 750 to 1,999 employees Large $250 to $999 million 2,000 to 4,999 employees X-Large $1 to $3 billion 5,000 to 19,999 employees XX-Large $3 billion + 20,000 + employees 8

Thank you to our 2013 Sponsors Gartner CIO Leadership Forum 2013 attendees met with solution providers to discuss the latest innovations, services and products. Thanks to our Sponsors for helping make the 2013 forum a lively, informative and rewarding experience. Platinum Sponsors Sponsors During the Innovation Showcase, attendees viewed technologies from inventive startups, innovative solutions from established vendors and cutting-edge work happening in government. Innovation Showcase participants 3DSystems Kopin Corporation Adept Technology, Inc. Looxcie Double Robotics Metaio Gemalto NASA io2 Technology National Renewable Energy Lab NextEngine Tobii Technology Zebra Imaging Media and Association Partners 9

March 17 19, 2013 Huntington Beach, CA gartner.com/us/cio Post-event resources Download session presentations Download the available session and workshop presentations from Gartner CIO Leadership Forum 2013. These can be a valuable resource for future reference, and a great way to share with colleagues what you learned. Click here to access the documentation page on Agenda Builder. Learn more with relevant research Want to learn more about the general session topics that interest you most? Turn to the end of the session presentations for a list of related Gartner research notes. Select Gartner research is available on demand at gartner.com. Connect with Gartner Connect with Gartner CIO Leadership Forum on Twitter. #GartnerCIO CIO EVENTS AROUND THE GLOBE The World s Most Important Gathering of CIOs and Senior IT Executives SAVE THE DATE Gartner CIO Leadership Forum 2014 February 23 25 JW Marriott Desert Ridge Resort & Spa Phoenix, AZ Bookmark gartner.com/us/cio for 2014 conference details. Gartner CIO & IT Executive Summit 2013 June 17 18, Frankfurt, Germany Gartner CIO & IT Executive Summit 2013 September 10 12, Mexico City, Mexico Gartner Symposium/ITxpo 2013 September 16 18, Cape Town, South Africa Gartner Symposium/ITxpo 2013 October 6 10, Orlando, FL For a complete list of Symposium/ITxpo events around the globe, visit gartner.com/symposium 10