Follow the Money: CIOs Have Nothing to Fear From CMOs

If chief marketing officers are really going to end up with larger IT budgets than CIOs by 2017 (as Gartner predicted early last year), a lot would have to change–and almost overnight. Why? Because corporate IT still controls 71 percent of IT budgets in the U.S., and that number will hold steady over the next three years, according to our 13th annual State of the CIO research (see “State of the CIO 2014: The Great Schism”). That research reflects the latest insights from 722 top IT executives.

We’ve also seen in other research here at IDG Enterprise (the parent company of CIO magazine) that a mere 7 percent of IT organizations use a decentralized organizational structure, versus 65 percent centralized and 27 percent federated. If the CIO’s budget control were truly shifting away, wouldn’t we be seeing far more decentralized IT departments?

One of the strongest indicators of rising CIO influence that cropped up in our State of the CIO research was that nearly half of you (44 percent) are reporting directly to CEOs, and that number jumped by 5 percentage points over last year’s results. That tells me that as technology moves to the center of business–driving greater innovation and competitive advantage–the CIO remains the best choice to be in charge of IT spending.

Certainly, the individual business units at most companies today are more tech savvy than ever. The quest to pull customer and market insights out of big data, using sophisticated and user-friendly online marketing tools, absolutely has IT spending on the rise in many marketing operations. Yet that’s a far cry from handling the lion’s share of any company’s IT budget, which includes responsibility for vendor negotiations, security and risk management, integration and systems management, and myriad other enterprise IT complexities.

The best news of all from our State of the CIO research is that one-third (34 percent) of IT leaders are spending more of their time as business strategists than technologists. That means engaging in activities that drive business innovation, identify opportunities for competitive advantage and track market trends or customer needs. The number of business strategists has tripled since 2011, when it was just 11 percent of our respondents.

So whenever I hear that aging Gartner prediction about CMOs and IT budgets these days, I have to wonder what they’re smoking over there. It’s clear that CIOs and their CEOs aren’t inhaling.