Foundry’s new study also found a majority of CIOs believe their role is becoming more digital and innovation focused

Foundry (an IDG, Inc. Company), the global leader in media, martech and data for the tech community, released its 22nd annual State of the CIO Report. The research showcases how the CIO’s role has changed over time, as well as an in-depth analysis of technology and business initiatives that CIOs plan to focus on in 2023.

According to Foundry’s report, a majority (77%) of CIOs say their role has been elevated due to the state of the economy and they expect this visibility within the organization to continue.

“The CIO role is constantly evolving, and economic conditions have put a new level of pressure on these executives,” said Holly McWalter, Marketing & Research Specialist, Foundry. “This year’s research showcases how this pressure trickles down to important decisions regarding priorities and budget, and provides insight into how CIOs are moving their business forward.”

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Key findings from this year’s State of the CIO Report are as follows:

Budgets Expected to Increase Despite Economic Concerns

Foundry’s research shows that CIOs are optimistic about budgets going into 2023, despite the state of the economy. More than half (56%) expect an increase in budget in 2023, 35% think budgets will remain the same, and only 9% anticipate a decrease. Top reasons for tech budgets increasing in 2023 include the need for security improvements (40%), need to upgrade outdated IT infrastructure (38%), application modernization (38%), investments in new skills and talent (36%) and product innovation (27%)

Despite optimism amongst most respondents, there is still caution as those that anticipate a decrease state economic instability and uncertainty as the number one reason for tech budgets decreasing in 2023. Company finances and performance is also a top reason for budget cuts at 49%.

When asked how technology budget is handled for specific roles within their organization, more than half (59%) of respondents said that the Chief Innovation Officer has a technology budget separate from the overall IT budget and 41% said the Chief Digital Officer has a separate budget. Respondents state roles whose budgets are a part of the overall IT budget include the Chief Analytics Officer (75%), Chief Security Officer (72%), and Chief Data Officer (63%).

CIO Role is Evolving with Business Needs

An overwhelming majority of CIOs (85%) believe their role is becoming more digital and innovation focused. When asked how they plan to spend their time in the next three years, CIOs strive to be the business strategist, focusing on driving business innovation, redesigning business processes, and modernizing infrastructure and applications (28%). Despite this, security is still expected to play a large part of their role as 70% anticipate their involvement in cybersecurity to increase over the next year, and just over half (55%) also anticipate their involvement in data analysis, data privacy/compliance, and AI/machine learning to increase.

When asked how the following activities characterize their current focus, 47% of CIOs said security management, followed by IT operations/systems performance (40%), aligning IT initiatives with business goals (38%), and modernizing infrastructure and applications (35%). Looking at skills IT departments are most in need of to support ongoing digital business initiatives, more than two in five (42%) said technology integration/implementation, as well as IT/cloud architecture skills (40%), and risk security management (36%).

Business and Technology Initiatives Driving IT Investment

In 2023, business initiatives expected to be the most significant in driving IT investments are increasing operational efficiency (45%), increasing cybersecurity protections (44%), transforming existing business processes (38%), and improving the customer experience (36%). When asked how the state of the economy has impacted the way their organization is prioritizing business initiatives, the following have increased in priority – increasing operational efficiency (58%), increasing cybersecurity protections (58%), transforming existing business processes (54%), improving profitability (54%), and improving the customer experience (49%).

Tech initiatives expected to be the most significant in driving IT investments in 2023 include security/risk management (38%), data/business analytics (34%), application/legacy systems modernization (28%), machine learning/AI (26%), and customer experience technologies (24%).

Foundry’s research found that CEOs have similar priorities as CIOs, but they are prioritized differently. The CEO’s top priorities for IT in the coming year are to strengthen IT and business collaboration (30%), upgrade IT and data security to reduce corporate risk (29%), improve the customer experience (24%), lead business/digital transformation initiatives (23%), and help reach a specific goal for corporate revenue growth (21%).

In conjunction with this report, CIO and the CIO Executive Council will host an exclusive discussion providing a thorough review of the report’s findings. John Gallant, Enterprise Consulting Director at Foundry, will host the event with special guests Gary Jeter, EVP and CTO of TrueStone Financial and Jo Abernathy, CIO of Blue Cross Blue Shield of North Carolina.

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