Business executives are increasingly bypassing the IT department and spending their own budgets on technology as “it’s too important for their business to leave to IT”, says analyst house Forrester.
A Forrester report, “Tracking The Renegade Technology Buyer,” uncovers the motivations and technology spending priorities of over 1,000 North American and European business executives.
Of the 891 respondents that had a budget over $1 million, 824 spent their own money on hardware, software, telecoms or IT services. Twenty-four percent of the 891 spent over 21 percent of their budget on technology, accounting for over $31 billion in expenditure.
Senior management and sales and marketing were the top spending business functions and financial services/insurance and telecom/utilities led the pack in “renegade” buying.
“The high business spenders are not doing it because it is faster or cheaper than central IT, they are doing it because they see technology as too important to their success not to be involved,” said Forrester.
In parallel to this this, says the report, senior management are more relaxed in dealing with technology, with 33 percent saying their “technology IQ has increased” and that they are more comfortable working with IT.
Another 20 percent said their use of consumer technology has “changed their expectations of how technology should be used”. Forrester stressed that this consumerisation of IT was not just about younger Generation Y staff wanting to bring their own Macs and iPhones to the office. Instead, it was about how senior managers drive business and technology strategy.
Forrester said high technology spending execs were also likely to hire their own IT staff, and also invest in technology areas like smartphone apps and analytics.
Forrester analyst John McCarthy said, “CIOs now have to pivot and act more as a consultant to the business. The days of a centralised controlled IT world are over. Vendor management can no longer be the central management point for IT departments.”
For suppliers, said McCarthy, they will “need to raise their business IQ and talk about business metrics and not endless tech-speak”.
In conclusion, the report says, “By taking ownership and funding of the customer engagement agenda, high-spending business execs will create a two-tier model where traditional IT ends up as the custodian of the traditional back-end enterprise resource planning (ERP)-type systems.
“Over time, IT will become much less of a blue-collar run and built organisation and much more of a white-collar shop focused on design, orchestration and integration, with more of the integration focused on external business partners and public cloud services.”
