Gartner CIO Agenda - 2021 - Rebuild the Future

Here are some key insights and stats from the Gartner CIO Agenda 2021 - Rebuild the Future webinar . Access the session deck here . This is based on the survey with CIOs in different industry verticals across all regions.

 

n = 1877 CIOs in 74 countries with $ 4.7 Trillion in revenue and $85 Billion in IT spend. 

Gartner classifies, survey respondents in 3 categories such as Top, Typical and Trailling based on 3 parameters mentioned below; and their rating on 0 - 5 scales (Trailling-0,1 Typical-2,3, 4,5-Top)

• Digital Maturity 
• Business Performance 
• Pandemic Response 

Top = 303; Typical = 1373 and Trailling = 201 performers. 

Summary

1. Overall Global IT spend is expected to increase by 2% in 2021. However, this is the lowest in the last 5 years (2017 - 2.2%, 2018 - 3.0%, 2019 - 2.9%, 2020 - 2.8% and 2021 - 2.0% increase)
2. Digital business has been maturing steadily; and Covid-19 accelerated the organization's digital efforts in the five stages mentioned below. 
1. Refine - 18%
2. Scale - 30%
3. Deliver - 25%
4. Design - 13%
5. Ambition - 13%
6. No digital initiative - 2%
3. 69% of the Board of Directors (DOB) are increasing their investment in Digital initiatives. but it is not same across all industries. 
4. Board of Directors Survey confirms CIOs have strengthened their Executive relationships.
5. 80% of the CIOs are educating CEOs and other senior stakeholders the value of IT and also saying, 'we're thriving because of their work'.
6. The Pandemic impact - The Pandemic drives Digital Business Acceleration in the 2 areas
   1. Increase operational excellence through digital business
   2. Drive cost optimization through digital business

   
   

Digital Transformation adoption is higher and lower in different industries because of assets they use to deliver value to customers. 

1. Banking and Higher education industries, that use information assets are easy to digitize. 
2. Oil & Gas has lots of assets that are Hard to digitize. 
3. Significant increases in the use of Digital Channels to Reach Customers and Citizens 
4. Faster rate of new product/new service introduction
5. Increasing investment in getting closer to the customer (CX/UX, CRM solutions, Website, Ecommerce, Containerization and Kubernetes)
6. Decrease in supplier reliability; increase in supplier duplication and in-house supply
7. Larger investments in technology areas such 
• Cyber/Info Security, 
• Business intelligence / data analytics
• Cloud services / solutions
• Process automation
• AI/Machine learning
• Digital workplace
8. Increase funding for digital innovation and experimentation/risk taking in IT.

Business Model adoption and their impact on IT investments

1. IT spending is more in 2021 for the industries that use Old business models i.e. > 90% old business model i.e. IT Spending is aimed at 2.92%
2. IT spending is less on the industries that have >=15% New business model. i.e. IT spending is aimed at 0.71%
3. Digitied industries with new business models have survived and thriven in the Pandemic strom. Non-digitized industries struggle to navigate.  

n	Industry	Old Business Models	Low-Cost Old Business Models	Old business model	High-Cost New Business Models	Sustainable New Business Models	New business model	2021 - IT spending
33	Oil and Gas	64%	33%	97%	3%	0%	3%	2.50%
68	Healthcare Providers	62%	35%	97%	1%	1%	2%	1.00%
110	Heavy Manufacturing	62%	33%	95%	3%	3%	6%	1.80%
45	Life Sciences	58%	36%	94%	2%	4%	6%	5.80%
81	Consumer Goods	47%	47%	94%	2%	4%	6%	2.50%
73	Retail	71%	21%	92%	3%	5%	8%	3.90%
450	Asset-Intensive Industries	59%	33%	92%	3%	5%	8%
42	Automotive	67%	24%	91%	5%	5%	10%	-0.25%
71	Utilities	48%	38%	86%	6%	8%	14%	2.20%
78	Insurance	60%	24%	84%	5%	10%	15%	2.50%
74	Transportation Industry	57%	26%	83%	8%	9%	17%	-0.50%
218	Government	54%	28%	82%	3%	16%	19%	1.80%
31	Communication Service Provider	42%	39%	81%	6%	13%	19%	-0.50%
196	Banking	53%	18%	71%	8%	21%	29%	2.50%
114	Higher Education	51%	20%	71%	9%	20%	29%	-3.00%
1814	Total	56%	28%	84%	4%	11%	15%	2.00%

Business model adoption across industries. Source: Gartner

Example

1. CTBC bank in Taiwan was able interact with 3.7 million customers through their digital applications
2. University of Central Florida was able to teach and engage with more than 25000 students additionally using Digital Channels out of their 70000 students.