IT’s future value proposition  

10 August 2017:

IT is poised to play a new, more strategic role in companies, one that moves beyond support to create business value through technology-based business innovation and digital initiatives. But according to the newest McKinsey Global Survey on business technology,1 IT organizations continue to struggle with performance issues, both in conventional IT and in areas that are critical for the future. As a result, technology leaders aren’t often the clear owners of technology-related activities and capabilities, and many respondents—especially on the business side—see their IT organizations as replaceable by third-party providers. For IT and its leaders to become business partners, the results suggest that CIOs must raise their skills and influence within the organization, leverage technology to move the business’s innovation agenda forward, and address the strategic, operating-model, and talent problems that underlie IT’s ineffectiveness.

A shifting value proposition for IT

According to the results, many executives—both in and out of IT—expect IT’s value proposition to change meaningfully in the coming years (Exhibit 1). Currently, the largest shares of respondents say IT creates the most value through more traditional business enablement and operational support. But they predict that in the next few years, technology will drive business results. Respondents are most likely to expect that IT will contribute most through innovation and through integrating technology solutions in support of business results—a dramatic shift from IT’s current role.

As part of that, respondents also believe that IT should be playing an important role in shaping strategy around digitization. Roughly 80 percent say that business and technology should collaborate on digital strategy, compared with only 55 percent who say they do so now.

Other responses reinforce the merit of IT’s contributions, both current and potential. When technology leaders are involved in shaping business strategy, IT’s ability to create value is greater. As we’ve seen in previous surveys, respondents report greater IT effectiveness when their CIOs are very involved in overall business strategy. With engaged CIOs, digital initiatives do better as well: 43 percent of respondents with very involved CIOs report significant business impact from their digital initiatives, compared with 23 percent of all others who say the same.

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Source: McKinsey&Company

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