The C-suite recognizes CIOs must become the chief architects of innovation and business change, according to a Deloitte survey.
Even before the COVID-19 pandemic began, organizations were recognizing it is no longer enough for CIOs to be a trusted operator or even a strategic business co-creator. Technology leaders were being called upon to serve as change agents, or "kinetic leaders," who envision, enable, and deliver growth and help their organizations navigate through change, according to a new study by Deloitte.
"The perspectives of C-suite executives and corporate board members on the role of the future technology leader are converging: business and technology leaders agree that their organizations need dynamic, change-oriented technology leaders—kinetic leaders—to help envision the technology-driven future, lead complex transformations, and be the chief architect of innovation and change for the business," according to the 2020 Global Technology Leadership Survey.
Sixty-nine percent of CXO and board respondents described successful tech leaders as having characters related to "change," "vision," and "innovation" over the next three years. Yet, just slightly more than one in 10 (11.6%) organizations are delivering significant value through technology, the study found.
"Distinguished by an orientation toward growth and leaders who advocate for, prioritize, and appreciate the value of technology, these companies are at the leading edge of leveraging technology for business growth,'' the report said. "They have different operating rhythms and strategic priorities, not just in the technology function, but across the entire enterprise."
The benefits of being a tech vanguard
Technology vanguard organizations are also more likely to have kinetic leaders spearheading their technology functions, the study said. These leaders play a pivotal role in shaping the organization's resiliency, recovery, and growth strategies in today's business environment and work effectively in doing so working across c-suite executives and board members.
For publicly traded companies that fit the tech vanguard, stock prices have appreciated 7% more than industry average since 2017, according to the report. Additional key characteristics of tech vanguards driving the future of business include:
Agility: 42% of tech vanguards use an agile approach to business and technology, compared to 14% of baseline organizations. These leaders are better prepared to respond appropriately to changing business circumstances while investing in future solutions.
Customer-orientation: More tech vanguards view customers (60%) and innovation (66%) as their top priorities than baseline organizations (53% and 44%, respectively).
Growth mindset: More than half of tech vanguards (52%) center their transformation efforts around implementing new business models, compared to the majority of baseline organizations (52%) whose efforts are more likely to focus on revamping existing operating models.
Tech-led: Tech vanguards appreciate the value of technology across the C-suite and at the board level, and this is reflected in higher investments in technology initiatives: 84% of these leaders encourage the pursuit of tech-enabled opportunities, compared with only 56% of baseline organizations. Baseline organizations are twice as likely to prioritize cost reduction (40%) than tech vanguards (20%).
Evolution of tech leadership from operational to kinetic
Marking a significant change since 2015, technology leaders have finally transitioned from operational roles to enterprise partners focused on driving strategy, according to the study. In today's landscape, business leaders at tech vanguard organizations expect technology counterparts to drive change throughout the enterprise as "kinetic leaders," those who have the ability to envision and deliver growth.
"The COVID-19 pandemic may have paused many in-person business operations, but it has sparked an accelerated adoption of digital technologies and capabilities that has helped organizations remain agile and resilient," said Khalid Kark, US CIO program research director at Deloitte, in a statement.
"When we started surveying leaders in the summer of 2019, we had no way to know that organizational agility and resilience would be tested in the way it is today," Kark said. "The role and importance of technology leadership has been elevated significantly during the current context."
Kinetic leaders have an opportunity to recover from the pandemic while also identifying growth investments and transformational initiatives that will help their organizations thrive in the long term, said Bill Briggs, principal of Deloitte Consulting, and Deloitte's global chief technology officer, in a statement.
"In the near future, the ability to collaborate and co-create solutions across larger ecosystems will help enterprises innovate, while balancing the need to reallocate technology budgets and priorities," Briggs said.
Respondents in both 2020 and 2018 (the last time Deloitte released a study) agree that soft skills will continue to play an increasingly important role over the next three years. In this year's report, respondents recognize creativity (69%), emotional intelligence (55%), and cognitive flexibility (54%) as leading characteristics for the future.
Consistently creating opportunities for on-the-job training is paramount with the half-life of a skill at about six years, according to the study. "In today's hyper-competitive market, companies need a kinetic leader who can apply these skills and translate potential opportunities into a strategic business outcome."
The study included 1,376 participants from 69 countries and 22 industry sectors, according to Deloitte.
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