CEOs seen as responsible for driving digital business, says Gartner

Unlike the popular belief that digital transformation usually starts with the chief information officer (CIO), a new research shows that it starts with the chief executive officer (CEO), with input from the board of directors, while realigning the organisation’s culture, markets, products, customer experience, and employee experience.

When it comes to leadership roles in digital transformation, board of directors cite CEOs (28%) as the primary leader responsible for driving digital business initiatives within the enterprise, ahead of the chief technology officer (CTO) (19%) and CIO (14%) respectively, according to a new research from Gartner, suggesting that the technology function now plays an integral role in business strategy.

“Historically, boards have looked to IT to lead digital business,” said Partha Iyengar, Distinguished VP Analyst at Gartner. “Yet given the macro and strategic benefits boards are now expecting from digital business, they now rightly expect to hold the CEO directly accountable for its success, similar to the accountability that CEOs have for enterprise revenue or growth.”

According to a survey of 1,010 CIOs conducted by IT firm Tata Consultancy Services (TCS) published in 2020, even though CIOs are often in charge of leading the initiatives, CEOs set the digital transformation budgets at 35% of companies. CFOs are in charge of digital transformation budget priorities at 29% of organisations, while CIO offices bear that responsibility at 18% of companies.

Similarly, an EY survey of 570 C-suite and senior business leaders published in September 2021 noted that a CIO must work closer with the CEO and other leaders than ever before if they want to excel at digital transformation. Organisations that can pull this off are 45% more likely than laggards to unlock annual revenue growth of more than 10%, it said. 

“As enterprises increasingly operate in a world of constant disruption, the most future-savvy boards are considering how upheavals and risks can serve as a source of opportunity,” Jorge Lopez, Distinguished VP Analyst at Gartner, mentioned. He believes that “CEOs and CIOs will need to adopt this mindset as technology plays an ever-expanding role in driving business success”.