Business executives emphasize that IT issues should not be solely handled by the IT department.
In a significant shift, the role of Chief Information Officers (CIOs) is experiencing a dramatic transformation, as businesses worldwide invest more in technology to drive digital transformation and business initiatives. This trend, fueled by investments in Artificial Intelligence (AI), data center infrastructure, and networking to support AI, cloud, and Internet of Things (IoT) deployments, is set to increase substantially.
According to a survey by Forrester Research, global IT spending is projected to grow nearly 8% year over year to $5.43 trillion in 2025[1]. This growth is particularly pronounced in data center hardware spending, which is expected to surge over 40%, reflecting the expansion in AI-optimized systems[1].
Executives are prioritizing AI capabilities and secure, resilient networks as essential for business growth. In fact, 92% of IT leaders plan to increase network budget shares to support AI rollout and operations[3]. Modernized networks are seen as critical for automation, personalized customer experiences, and enhanced cybersecurity[3].
This accelerated IT spending and technology adoption have led to a significant evolution in the CIO's role. No longer confined to back-office data center management, CIOs are now key business partners in the C-suite. They lead digital transformations, innovation, and help connect technology initiatives directly to business value like customer satisfaction and revenue growth[2][4].
CIOs today also emphasize change leadership, agile delivery, and co-creation with business units rather than solely managing IT infrastructure. This shift toward a product and business-oriented mindset is driven by the need to navigate rapid technological change and align IT spending with strategic business goals[4].
The author of the report, John McCarthy, compares this change in IT management to the end of the centralized state-run economy of the Soviet Union[5]. He suggests that vendor management can no longer be the central management point for IT suppliers, and that they need to teach the business those skills[5].
Key findings from the survey include:
- Just under a third (31%) of respondents spend between 1% and 5% of their budget on IT, while 38% spend between 6% and 20%. A smaller number (24%) spend 21% or more of their budget on IT, and Forrester refers to this group as "high spenders"[2].
- More respondents used their own budget to buy packaged software applications than cloud offerings (33% high, 29% low)[2].
- 61% of "high spenders" said "technology is too important for the business not to be involved", and 43% of "low spenders" agreed with the statement[2].
- 20% of high spenders believe that business leaders' use of consumer technology has changed their expectations, while 11% of low spenders hold the same view[2].
- 22% of low spenders believe that business execs' understanding of technology is increasing, and 33% of high spenders hold the same view[2].
- A smaller number of respondents used their own budget to buy cloud offerings (24% high, 29% low)[2].
In conclusion, the increasing trend in IT spending is redefining CIOs as strategic leaders who drive business innovation, transformation, and competitive advantage through technology[1][2][3][4]. As we move forward, CIOs are advised to pivot and act more as consultants to the business, as the days of a centralized controlled IT world are over.
- The growth in IT spending, particularly in data center hardware, underscores the significance of technology in business growth, making the role of CIOs shift from managing IT infrastructure to becoming key business partners.
- As technology becomes increasingly crucial for business innovation and competitiveness, CIOs are transitioning from a predominantly managerial role to acting as consultants, emphasizing change leadership and alignment with strategic business goals.
