27 April 2018

The explosion in cloud applications and IaaS has enabled business units to purchase critical software and increasingly bypass the IT team when defining, sourcing and managing new IT initiatives. 

That’s according to research conducted by software asset and cloud management specialist, Snow Software. 

After polling 100 CIOs and IT leaders of companies in the UK with more than 500 employees, the firm found that changes in IT procurement and consumption are “driving a divide” between business and IT.

Twenty-four per cent of respondents said that at least half of their organisations’ technology spend is controlled by business units rather than the IT team, and 19 per cent stated that control is shifting away from IT.

The vast majority of IT leaders surveyed expressed concern that audit preparation is becoming more time consuming and complex as a result (90 per cent), and that  cloud spend will “spiral out of control” (83 per cent).

Some of the other issues they raised included concerns about: an increased data security risk (70 per cent); an increased threat of non-compliance (60 per cent); fears over losing control and influence (41 per cent); and a lack of visibility into technology spend (42 per cent).

“There is no question that many CIOs are now grappling with the divide between business and IT as purchasing patterns continue to shift,” says Axel Kling, CEO, Snow Software. 

“However, CIOs needn’t fear this shift. This research illustrates that forward-thinking CIOs are adapting to become a trusted advisor to the business.”

Despite their concerns, 65 per cent believe business unit involvement will not undermine agility and innovation, while 69 per cent said that they saw growing business unit ownership of technology spend as an opportunity to better support and align with the business.

Almost half (49 per cent) reckon this will enable them to personally focus on more strategic initiatives, while just under a third (30 per cent) also reported that the shift has made it easier to command boardroom attention, as the organisation’s leadership gets to grips with digital transformation.

Kling says CIOs are increasingly required not just to define and lead individual projects, but to provide the CFO and the executive team with an understanding of technology budgeting and assurances that money is being spent wisely.