Established less than 20 years ago, the chief information officer (CIO) role was created to ensure a CEO’s technology vision would be optimised and delivered. In recent years, however, that intention has often produced the opposite effect.
Despite generous investment compared with many other departments, IT frequently fails to deliver the efficiency gains and transformational outcomes it promises. Studies suggest around 70% of IT projects do not realize their intended benefits. This high failure rate helps explain why prominent CIOs have resigned or been replaced mid-project over the last decade — organisations such as Royal Mail, BT Design, Unilever, Network Rail, Habitat and the London Stock Exchange have all experienced such turbulence.
CIOs are still expected to define and deliver a company’s IT strategy, yet many find themselves constantly firefighting. As businesses expand through acquisitions, CIOs must devote substantial time and resources to integration work. Ironically, success can make the problem worse: the more acquisitions a company makes, the greater the integration burden becomes. In high-growth organisations, CIOs often expend so much effort keeping systems functioning that they have little capacity left for innovation.
This pattern is particularly visible in the telecommunications sector, where mergers and acquisitions are commonplace. When a telco wants to launch a new service or product, the required work — bespoke technology development, integration with existing provisioning and billing systems, testing and operational readiness — is time-consuming and costly. These projects compete with day-to-day operational demands, which can delay launches until any potential competitive advantage has evaporated.
The same constraints apply for enterprises that attempt to build new telecommunications capabilities in-house. Designing and deploying an information and communications infrastructure without external support is often prohibitively expensive and slow. Fast-growing companies that struggle with numerous, siloed systems frequently find that internal delivery simply cannot keep pace with business needs.
Cloud and outsourced services have emerged to address these gaps, allowing organisations to meet many IT requirements on demand. Recognising the strain on their role, CIOs have embraced these options: nearly six in ten report that aligning business and IT strategies via cloud infrastructure is a top priority. More than half also say that accelerating the launch of new services and applications is one of the most frequent requests from business units.
Cloud solutions have enabled CIOs to exploit network and platform capabilities more effectively. In telecoms, for instance, they can spin up call centres when contracts are signed, deploy mobile working tools in days, and deliver unified communications rapidly — all thanks to cloud-based models.
As a result, the CIO’s role has shifted from single-handedly leading and implementing a technology vision to managing a portfolio of outsourced contracts and partnerships. This transition can be a saving grace: when managed well, it allows CIOs to deliver strategic value to the board and to the business.
However, success depends on skilled supplier governance. During the financial crisis many organisations focused relentlessly on cost reduction, squeezing suppliers for rock-bottom prices. Forrester Research cautions that a procurement model built solely around the lowest price often leads to poor delivery and weak execution, leaving CIOs in nearly as difficult a position as when they attempted to deliver projects alone.
Forrester advises IT leaders to avoid an overly centralised, cost-driven procurement approach and instead concentrate on business outcomes. CIOs should design services to meet those outcomes, managing a portfolio that demonstrably drives value for the CEO. Without this outcome-focused orientation, the CIO risks becoming marginalised.
In telecommunications, that means choosing partners who add real business value. Enterprises with evolving communications needs require providers that enable effective, efficient, economical and secure interaction with employees, customers and suppliers — not just the cheapest option. Service providers, in turn, need partners that simplify and accelerate the creation, customization and delivery of communications products. Only through such collaborative relationships can CIOs on both the enterprise and provider sides remain valued contributors across the ecosystem.
There are already firms offering on-demand services on an OPEX basis, helping carriers and providers move up the value chain and bring innovative products to market for enterprise and public-sector customers. These models reduce up-front capital costs, speed time-to-market and allow organisations to experiment with new services with lower risk.
Ultimately, the modern CIO faces a reality in which specialist consultancies and third-party providers can often execute faster and more effectively than in-house teams. That shift undermines the original mandate of the CIO, but it also creates an opportunity: by embracing cloud services and treating external providers as extensions of the IT team, CIOs can meet business demands more consistently and add meaningful strategic value. Attempting to manage everything internally without third-party support is no longer a viable option.