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Harvey NasH
CIO survey 2010
New decade, New opportuNities?

in association with

Contents

1. Executive summary 6
2. CIO spotlight 10
3. Leaders in technology: salary review 13
4. Survey results 17
4.1. Global results* 18
4.2. United States results* 28
4.3. Europe results* 42
5. European country and regional profiles 55
5.1. Belgium 56
5.2. France 58
5.3. Germany 60
5.4. Ireland 62
5.5. Netherlands 64
5.6. Scandinavia 66
5.7. Switzerland 68
5.8. United Kingdom 70
6. Conclusions by PA Consulting Group & Harvey Nash 72

* Key areas covered by this survey
Job roles, Reporting lines and board presence, Geography and industry,
Budget responsibility, Key issues, Skills, Innovation and collaboration,
IT budgets, Outsourcing and offshoring, Career and compensation

Copyright harvey Nash plc 2010 Harvey Nash CIO Survey 2010
2

Foreword

Welcome to the 2010 CIO Survey

In the fifth year of producing our detailed survey in the U.S. and 12th year of producing
it globally, harvey Nash is extremely proud to have delivered a research report that is
more insightful and expansive than ever before.

An incredible 2,655 respondents from every corner of the globe invested their time,
experience and opinions into helping us produce the 2010 CIO Survey. It has been a
phenomenal undertaking, and we are indebted to all the participants and contributors
for making this report one of the most extensive studies of its kind in the world.

As such, I would like to thank our ongoing partners at PA Consulting Group for
providing their expertise and helping our audience better understand the challenges
facing today’s CIO.

In this year’s report, you will be able to see analysis presented on a global basis, compare
trends across continents and explore country-by-country overviews.

the results show that the CIO community is currently wrestling with significant pressures
as the Great Recession fades into history and a new decade, with a new competitive
landscape, emerges.

Offshore destinations for outsourcing, the emergence of new technology models like
cloud computing, a redefined skills shortage and even the strategic role of the CIO itself
have all been fundamentally changed by the economic crisis.

Regarding CIO career development, evidence suggests that the recession has had
a disproportionate impact on remuneration and job satisfaction for some CIOs. the
gap between the "haves" and "have-nots" appears to be widening and could point to a
significant migration of CIO talent in the coming years.

this report is truly our best yet, and I am sure you will find the results both enlightening
and valuable in your own career development and business operations.

Bob Miano
President & CEO
harvey Nash USA

Harvey Nash CIO Survey 2010
3

CIO viewpoints from aro
Karen Forte, CIO & Head of Services, Allianz, Ireland
to be able to help your organization batten down
and survive the current climate is just as rewarding as
delivering the award-winning projects. Being creative
in this environment is just as stimulating because
the stakes are in fact higher than during the general
economic climate that prevailed for the past decade.

John Donnarumma, Global CIO, Group M, U.S.
there are two 'musts' for a CIO: being able to
thrive in a chaotic environment and being able
to anticipate the absolute unknown.

David Bickerton, CIO, British Gas, UK
It’s all about improving customer service. We’ve made
a lot of progress, but there’s more to do. Our biggest
challenge is satisfying the appetite for business change,
but that’s a great challenge to have because we have
the people who rise to that challenge.

Debra C. Robinson, Global SVP/CIO, Hearst Magazines, U.S.
Outsourcing/offshoring is one of hearst Digital Magazines' strategic
directions to increase productivity and delivery of products. It has
allowed us to scale up and down quickly and efficiently.

Tom Verhulst, CIO, Ziggo, Netherlands
to grow as a department, we need business
consultants; people who know the business
and who understand It processes and the
organization. the priority for CIOs is to
integrate the business and It capabilities.

4

ound the world
David Henderson, CIO, Daily Mail General Trust Group, UK
Daily Mail Group is operating in very challenging business
conditions. the It strategy relies on unlocking the potential
of the entire team, recognizing delivery, positive attitude
and creativity. talent Management is increasingly
becoming a critical issue for executives globally, and
the ‘war for talent’ does not abate.

Edward Johnson, IT Director, Falcon Bank, Switzerland
We hired some of our brightest staff during the recession by
successfully communicating the 'brand' of our It vision, which
included an aggressive commitment to a fully virtualized global
banking environment, working with a CEO who understands the
value of a client focused and cost-aware It department, and
the idea that technologists need to work with a 'here to serve'
attitude, rather than doing 'It for the sake of It'.

Gary Arthurs, CIO, HMV Group, UK
Our markets are undergoing a fundamental shift, so it's
essential we drive out value from existing systems to
fund accelerated innovation in loyalty and digital offers
—the pure hMV and Waterstones loyalty programs
are key investments for learning about our customers
and interacting with them through social media and
direct marketing.

Frans Haverkamp, CIO, Eneco, Netherlands
As the economy transitions from recession to
recovery, my most challenging topic for 2010 and
beyond will be to continue to derive benefit from
the cost cuttings of 2008/9, while at the same
time supporting the business as it transforms from
efficiency-focus to value-creating productivity.

Countries indicated are where the CIOs are primarily based.
5

1. Executive summary
According to most respondents technology played an
important role in the survival of many organizations.

New insights
In 2010, the harvey Nash CIO Survey with PA Consulting ‘went global’ with
thousands of CIOs from around the world contributing their insight and opinions.
to analyze and compare responses on a global basis has created a fascinating report that
examines how CIOs and other global leaders in technology view themselves, their function
and the challenges they face.

Global salary analysis
the report reflects on as many similarities within the CIO community as differences. the
vast majority of global respondents, over 60 percent, experienced a salary freeze in 2009
with about one in 10 seeing a salary cut. Conditions are improving in 2010, and, despite a
challenging year for salary inflation, most CIOs are realistic about the need to reflect the
fragile economic environment.

Fifty-nine percent of CIOs believe executive remuneration should be restrained until the
economic recovery is more stable while 72 percent said they would consider freezing or
cutting their own salary to improve the financial stability of their organization.

In analyzing base salaries of CIOs from around the world, it becomes clear that a significant
divide exists. Germany and the U.S. come out strongest on remuneration with Belgium
and Ireland struggling to retain parity in compensating top It talent. With the new Base
Salary Matrix, we have created a comparison tool for the spectrum of leadership roles in
technology. the matrix contrasts the average remuneration in each country with peers on
a global basis.

All about the CIO
According to most respondents, technology played an important role in the survival of
many organizations during the last 12 months. Seventy-four percent of CIOs were asked
to focus on cutting costs and 75 percent on increasing operational efficiencies as the
recession raged across the globe.

the CIO's reward for their recession-busting performance seems to be a stronger strategic
voice and, in many cases, a seat on the operational board. the strategic focus of the CIO
is growing; 71 percent of global respondents foresee a greater role in strategy decisions in
2010. to fulfill a wider set of responsibilities, many CIOs are focusing on advancing their
skillset through advanced education. Communication and influencing skills are the most
important to CIOs according to 81 percent of them while leadership skills, 76 percent, and
strategy and planning skills, 57 percent, are also prioritized.

however, career development signals for CIOs are not all positive. Careers were certainly
stunted by the recession, and CIOs are now more wary about moving to their next role until
the economic environment stabilizes further.

6

This year the skills shortage
has returned to prominence.

Priorities for 2010
As the global economy emerges from recession, there are also a wide range of priorities
for CIOs to address in their organizations. Germany, the U.S. and the UK appear to be
more proactive in their approach to 2010 and have adopted a greater focus on investment,
innovation and overtaking competitors weakened by the recession. In contrast, CIOs in
Belgium and France plan to focus on a more cautious strategy of cost control and internal
efficiency improvements. Swiss CIOs are planning to put greater energy into clearing the
backlog of projects postponed by the recession.

A smaller world
During the course of this research a number of significant differences have been identified
about CIOs from around the world. Just as important, however, are the many similarities
that were discovered. For example, 44 percent of CIOs now report to the CEO or CFO,
more than any other senior executive. the expanded influence CIOs have as a result of
their reporting line provides them with a greater understanding of the wider business
environment and how technology can be used as a competitive tool in global markets.

Additionally, the impact of the global recession was, well, global. Every organization was
affected in one way or another and every CIO faced challenges associated with the
recession. Fifty-five percent of the respondents occupy a role with global responsibility
and can relate to the difficulties faced by peers on the other side of the world.

Skills for growth
the wider community of CIOs surveyed this year generally agrees that communication and
influencing skills are the most important for advancement in a post-recession world. this
is balanced with a feeling that a formal MBA or other advanced degree will enhance their
ability to compete for more senior positions. Many CIOs used the recession to explore
expanding their skills with 59 percent believing an MBA would improve their strategy and
planning abilities.

this year the skills shortage has returned to prominence. Fifty-eight percent say they will
suffer from a technology skills shortage at some point, up 4 percent on last year. Compared
to the global average, the skills shortage is more pronounced in Scandinavia at 72 percent,
Switzerland at 71 percent, the U.S. at 68 percent, the Netherlands at 65 percent, Belgium at
67 percent and Germany at 62 percent.

the UK at 56 percent and France at 30 percent appear to be less severely impacted by
the skills shortages, which are below the global average. the skills most in demand by
CIOs from around the world are business analysis, project management and architecture.
the intensity of demand differs by country and region.

7

Two developing innovation models are gaining
prominence as CIOs face the world in 2010.

Innovation and collaboration
Innovation success is improving in all regions analyzed, but 55 percent of CIOs still don’t set
innovation targets, creating a significant opportunity to increase success in future.

During the recession, innovation projects were used by many CIOs as a weapon to deliver
the cost savings demanded by the organization. however, now many CIOs, 60 percent,
are shifting their innovation focus into growth activities and using innovation projects to
enhance the quality of products and services. Additionally, 58 percent of global respondents
are innovating to speed up the delivery to market of their offering to capitalize on re-
emerging growth trends.

two developing innovation models are gaining prominence as CIOs face the world in
2010. Software as a Service (SaaS) will become more important to 35 percent of global
respondents this year. In Germany, it will be adopted by 83 percent while in Scandinavia
42 percent of CIOs will be increasing their use of SaaS. Cloud computing is on the agenda
of 51 percent of CIOs globally, which is a positive trend. Yet in France, the expected
acceptance of a wider cloud model is at a far more positive 78 percent.

half of the respondents this year will collaborate more than last year. It appears that many
CIOs realized during the recession that their organizations were somewhat on their own,
but that in order to grow this year they will need to collaborate with others. the main
barrier to collaborating is now a lack of agreed behaviors between organizations whereas
before the recession the key obstacle was the physical dispersion of teams.

Outsourcing
CIOs invested in outsourcing throughout the recession to remain as cost effective and
responsive to their organizations' rapidly changing priorities. this year, 87 percent of CIOs
will maintain or increase their investment in outsourcing projects, up 11 percent on last
year’s sentiment. Globally, the top outsourced functions remain software application
development, 62 percent, software application maintenance, 53 percent, and It
infrastructure, 53 percent.

the role of India in offshore outsourced programs remains dominant, but the dominance
is waning and the rise of Eastern Europe as a preferred hub, especially for European-based
CIOs, is undeniable. More than one in 10 global CIOs now undertake offshore activity in
Eastern Europe. that figure is significantly higher within those European countries closest
to the region.

Job satisfaction: the biggest casualty of the recession
the pay freezes and salary cuts seen in the analysis this year have had a significant impact
on the motivation of CIOs around the world. CIOs have seen fewer career opportunities
as organizations implemented recruitment freezes and many expressed a sentiment
that running projects to save costs is just not as personally rewarding as innovating with
technology to pursue growth.

8

Respondents remain cautious about changing
jobs due to the wider economic fragility.

these trends have combined to depress job satisfaction on a global basis, which is
down 4 percent this year at 76 percent. the situation is worse in selected countries.
For example, career fulfillment among CIOs is at 60 percent in Germany and 68 percent in
the U.S., down significantly on previous years.

however, the result may not be a mass exodus of dissatisfied CIOs from their current
employers. Respondents remain cautious about changing jobs due to the wider economic
fragility, but there is also a greater emphasis on non-monetary benefits. CIOs who shared
foxholes with their CEOs and CFOs as they led their organizations through the worst of the
recession have a greater sense that they’ve earned the right to help shape the next phase
of growth.

If employers realize that a greater sense of loyalty exists—at least for now—and invest
in the development of their CIOs, they will be able to retain key talent over the next
24 months.

Please note: The 2010 CIO Survey from Harvey Nash is global in nature and was
undertaken across many different countries, languages and currencies. For ease
of production the currency used is the U.S. Dollar. At the launch of the survey the
conversion rate of U.S. Dollar to UK £ Sterling and Euro was $1 = £0.62 and €0.69.

9

2. CIO spotlight
We aim to shine a
spotlight on the CIO.

CIOs are unique creatures who are often viewed singularly in the context of their own
organizations rather than as a member of a global community of technology leaders. In this
new section, we aim to shine a spotlight on the CIO and identify some of their similarities
and key differences.

One of the most profound differences concerns the compensation that CIOs receive. this
report includes the following section that is dedicated to comparing remuneration by a
range of variables. the difference between the highest and lowest average CIO salaries is a
significant $46,932.

Beyond remuneration, there are key differences in the role and mindset of CIOs around the
world. this section compares their strategic influence, job satisfaction, leadership skills and
career aspirations in the top 10 regions surveyed.

2.1. CIO strategic influence
At a global level, the CIO is a strategic figure. Fifty percent of CIOs report to the CEO while 26
percent report into the CFO, ensuring they have influence at the highest level. Additionally,
59 percent of CIOs globally sit on the operational board giving technology a prominent
voice within their leadership team.

Table 1. CIO strategic role vs. job satisfaction

CIO becoming
Rank Country more strategic Job satisfaction
1 Germany 100% 60%
2 Belgium 83% 98%
3 Scandinavia 81% 97%
4 Netherlands 74% 88%
5 Global average 71% 84%
6 UK 71% 83%
7 U.S. 68% 78%
8 Ireland 67% 82%
9 France 50% 66%
10 Switzerland 46% 73%

there is unanimous agreement from CIOs in Germany that their role is becoming more
strategic. Both Belgian and Scandinavian CIOs are also far more likely than the average CIO
to adopt a more strategic role this year. Worryingly for CIOs in Switzerland, only 46 percent
believe they will be more strategic this year.

With job satisfaction for C-level executives so closely linked to their strategic relevance, it is
clear to see that those with a greater appreciation of a more strategic role this year are also
more satisfied in their careers. In Germany, the one major exception to this rule, the CIO
community agrees that their role is becoming more and more strategic, but CIOs remain
unsatisfied with their position.

10

2. CIO spotlight
The different emphasis on skills given by
CIOs in each country can be easily tracked.

Conversely, despite having the lowest strategic input of the countries surveyed, CIOs from
Switzerland remain more satisfied in their jobs than French and German peers. UK and U.S.
CIOs have a job satisfaction that corresponds with their below-average strategic input.

2.2. CIO skills to succeed
the skills deemed most important by CIOs for career advancement are compared in the
table below and are ranked in comparison to their rating given by the global CIO average.
the different emphasis on skills given by CIOs in each country can be easily tracked by row.

Table 2. CIO skills rating

Communication Strategy Change ROI Outsourcer IT
Country and influencing Leadership and planning mgt oriented mgt awareness
Belgium 50% 58% 58% 42% 42% 8% 17%
France 70% 60% 50% 30% 80% 30% 0%
Germany 89% 75% 56% 44% 22% 56% 22%
Global average 81% 76% 57% 40% 33% 23% 10%
Netherlands 72% 71% 47% 40% 20% 23% 10%
Ireland 78% 73% 57% 35% 47% 13% 20%
Scandinavia 67% 74% 69% 36% 38% 26% 5%
Switzerland 72% 72% 44% 40% 8% 24% 16%
UK 87% 73% 61% 43% 37% 23% 10%
U.S. 85% 88% 56% 37% 33% 25% 9%

While CIOs globally rate communication and influencing skills highest in importance, this
is not the case in Belgium, Scandinavia or the U.S. Leadership is the most highly regarded
ability by CIOs in those countries. Swiss and Dutch CIOs place less emphasis on strategy and
planning skills than most while French CIOs have a far higher regard for the importance of
an ROI focus than their peers. It awareness is the least relevant skill according to the global
average, but CIOs in Ireland and Germany still rate it twice as important as the average.

2.3. CIOs on the move
As CIOs around the world emerge from the recession and assess the damage wrought to
their project pipelines, their organizations’ growth and their own career prospects, there is
a considerable variance in their eagerness to leap into new career prospects.

11

2. CIO spotlight
CIOs are less likely to pursue a new
role than they were pre-recession.

Table 3. CIO intent to change jobs

Country Less 1 yr 1 - 2 yr 2 - 5 yr 5 - 10 yr 10 yr +
Germany 60% 20% 20% 0% 0%
France 44% 12% 22% 0% 22%
Switzerland 30% 13% 35% 13% 9%
UK 21% 30% 38% 9% 2%
Global average 19% 24% 39% 12% 6%
Netherlands 19% 26% 39% 12% 4%
U.S. 18% 20% 39% 15% 8%
Ireland 17% 21% 26% 15% 21%
Scandinavia 3% 15% 50% 21% 11%
Belgium 0% 11% 56% 33% 0%

CIOs are less likely to pursue a new role than they were pre-recession. German CIOs are
the most strategic but also less satisfied with their careers so it is perhaps unsurprising that
they are the most likely to move jobs in the next 12 months. French, Swiss and UK CIOs
are also more likely than the global average to want to move this year. At the opposite end
of the spectrum, Belgian and Scandinavian CIOs have emerged from the recession as the
most risk averse regarding career prospects with far fewer CIOs intending to move jobs in
the next two years.

12

3. Leaders in technology: salary review
A significant difference can exist in base
remuneration depending on country.

In this new section to the report for 2010 the base salaries of CIOs and other
technology leaders from around the world are analyzed together to provide a
snapshot of remuneration trends. the average base salary is compared by geography
and by job title. this report also introduces the harvey Nash Base Salary Matrix, which
identifies salary hot spots for various countries.

3.1. Average base salary by country
Average salaries are assessed at the country level and the top 10 are provided below in
a ranked table. the base salary is calculated using the mean point within the salary range
and the total number of respondents per region.

Table 4. Average base salary by country

Rank Country Average base salary
1 Germany $175,000
2 U.S. $164,119
3 Switzerland $158,140
4 Scandinavia $152,163
5 Netherlands $148,264
6 Global average $144,734
7 France $137,500
8 UK $137,112
9 Ireland $129,928
10 Belgium $118,269

those countries that sit above the global average of $144,734 are the Netherlands,
Scandinavia, Switzerland, the U.S. and Germany, which leads the salary table by a solid
margin. With an average base salary of $118,269 Belgium occupies the number 10 slot
with a base salary that is $56,731 below Germany. Ireland, the UK and France also sit below
the global average. there is no doubt that a significant difference can exist in your base
remuneration depending on which country you operate in.

3.2. Average base salary by job function
the average salary by country, outlined in table 4 above, was categorized generally with a
‘leader in technology’ being determined by a level of management or budget responsibility
above a defined threshold. In this sub-section respondents are categorized into the
following four groups reflecting their job roles, seniority and scope of responsibility:
CIO/CtO, It director/VP, It manager and It professional. the average base salary for these
categories is outlined in table 5 on the next page.

13

The global average base salary for CIOs is understandably
in the upper tier of all technology leaders.

Table 5. Average base salary by job function

Job function Global average base salary
CIO/CtO $166,440
It director/VP $138,711
It manager $106,604
It professional $106,429

the global average base salary for CIOs is understandably in the upper tier of
all technology leaders. Somewhat surprisingly, It professionals without significant
management responsibility have an average base salary only $175 less than It
managers. One likely reason for this parity is the influence of senior technology
consultants in the survey response. While they do not always have a team of direct
reports, consultants working for some of the world’s biggest firms can also be some of
the best paid individuals in the sector.

3.3. Average base salary matrix
the table below shows where technology leaders within four key categories are placed in
the global matrix of core remuneration.

Table 6. Average base salary matrix

Country CIO/CTO IT director/VP IT manager IT professional
Belgium $151,389 $138,542 $88,393 $56,250
France $143,750 $143,750 $125,000 N/A
Germany $187,500 $150,000 N/A N/A
Global average $166,440 $138,711 $106,604 $106,429
Netherlands $166,667 $139,973 $103,846 $125,000
Ireland $159,052 $133,333 $102,574 $87,500
Scandinavia $152,334 $164,063 $112,500 N/A
Switzerland $156,522 $156,944 N/A N/A
UK $160,256 $126,986 $100,581 $116,667
U.S. $190,682 $162,736 $123,512 $108,594

the base salary matrix shows that CIOs and CtOs are best served operating from the
U.S. where these leaders can earn an average base salary of $190,682. Germany is also an
attractive destination in terms of salary with a slightly lower $187,500 average.

14

IT professionals without management
responsibility vary greatly in their base salary.

Interestingly, in Scandinavia and Switzerland It Directors/VPs actually have a higher base
salary than CIOs. this suggests many of the duties attributed to a CIO in other regions are
undertaken by It directors in these countries.

It managers have a six-figure global average base salary and this is the case for
all countries where data could be collated except Belgium. the UK, the Netherlands
and Ireland joined Belgium below the global average for It managers. France best
compensates this group of technology leaders at $18,396 above the global average.

It professionals without management responsibility vary greatly in their base salary.
With an average of $56,250, it is realistic to suggest that It professionals from Belgium
are more junior team members. Earning $125,000 in the Netherlands and $116,667
in the UK, It professionals in these countries receive a larger base salary than their
It managers suggesting these professionals include a greater percentage of highly paid
technology consultants.

15

4. Survey results

17

4.1. Global results
2,655 diverse responses from as far afield as London,
Warsaw, New York, Cape Town, Lahore, Buenos Aires.

2010 is the first year that harvey Nash has surveyed the CIO community on a global
basis. It was a tremendous success with over 2,655 diverse responses from as far afield
as London, Warsaw, New York, Cape town, Lahore, Buenos Aires and practically every
destination in between.

4.1.1. Job roles: global
Consistent with previous harvey Nash reports, the survey is dominated by CIOs and
senior technology managers (Vice President/Director), who accounted for a combined 85
percent of the respondent community.

Figure 1. Breakdown of respondents by job function: global

3%

12%
C-level
37% Senior management

Mid management

Professional
48%

4.1.2. Reporting lines and board presence: global
the respondent community overwhelming reports to the top executives in their
organization with the CEO taking direct management responsibility for almost one-third
(29 percent) of CIOs.

Figure 2. Reporting lines of respondents: global

17% CEO
29%
CFO

COO
27% CIO
15%
Other
12%

18

4.1. Global results
2 percent of CIOs are responsible for a
budget in excess of 1bn dollars.

While they are senior executives in their own right, only 42 percent of the global
respondent community currently sit on the operational board of their organizations.
however, this finding is in line with 2009 results from both Europe and the U.S. and has
remained fairly constant since 2007.

4.1.3. Geography and industry: global
Fifty-five percent of respondents have either a global or multinational remit while only 10
percent have responsibility limited to their local markets. Due to the senior level of the
audience, this finding is in line with expectations and previous years.

Similarly, the range of industries that respondents represent is consistent with previous
harvey Nash studies. Information technology and financial services represent one-third
(33 percent) of the total respondent population.

Figure
20% 3. Top industry sectors: global
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4.1.4. Budget responsibility: global
While 2 percent of CIOs are responsible for a budget in excess of 1bn dollars, the majority
manage budgets in the millions. Fifty percent are responsible for a budget of $10m or less
while a further 28 percent manage budgets of $10m to $50m. the remaining 20 percent
operate budgets of $50m up to $1bn.

19

4.1. Global results
Two-thirds of respondents feel the role of
the CIO is becoming more strategic.

Figure 4. Shifts in strategic responsibility: global

24% More

Less

Same
12%
64%

Perhaps unsurprisingly with the scale of It budgets they manage, almost two-thirds
(64 percent) of respondents feel the role of the CIO is becoming more strategic within
their organizations. this is a similar result to last year’s European research which found that
more than 60 percent of respondents felt the role was becoming more strategic. 2009 and
2010 figures reversed the decline of influence perceived between 2006 and 2008, which
suggests the recession has not eroded the strategic role of the CIO.

4.1.5. Key issues for technology to address: global
Compared to last year, when cost saving was indubitably the most prominent issue, the
key issues the company board is asking the CIO to address in 2010 are less pronounced.
As shown in table 7 below, priorities are balanced between keeping costs under control
and activities that drive new business opportunities, such as increasing operational
efficiency for new orders.

Table 7. Key issues for IT to address: global

Rank Global key issues %
1 Increase operational efficiencies 75%
2 Cost saving 74%
3 Improve business processes 71%
4 Innovation 38%
5 Developing new products 35%
6 Entry to new markets 28%
7 Improving price competitiveness 23%
8 Green It 15%
9 Responding to globalization 15%
10 Mobile commerce 14%
11 Other 5%

20

4.1. Global results
A shortage of key skills is re-emerging as the
global economy recovers from the recession.

the top three priorities listed are still given significantly more attention compared to
what might be considered more long-term ambitions, such as innovation, new product
development and entry into new markets. this suggests that a healthy level of caution
remains among the global CIO community.

4.1.6. Skills: global
A shortage of key skills is re-emerging as the global economy recovers from the recession.
Fifty-eight percent of global respondents this year said they expect to face a skills shortage,
which is up 4 percent from 2009 European figures.

Global respondents prioritize a similar spread of skills compared to research from last
year, as Figure 5 demonstrates. Business analysis skills are the highest priority, sought by
44 percent of respondents. Project management and architecture skills are also in high
demand. Although business analysis has shifted into the number one position, the top
three skills from 2009 remain the top three most desired skills in 2010.

Figure 5. Skills most in demand: global
50%
44%

40%
37%
35%

31%

30% 28%

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22%
21%
20%
16%

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6%

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the financial impact of skill shortages is becoming more evident. Sixty-five percent of
global respondents said their growth will be impacted or significantly impacted as a result
of skills shortages.

When asked how their technology team rated on specific skills, almost two-thirds
(65 percent) feel their teams are good or excellent at building and maintaining relationships
with the business. Sixty percent are also rated highly for project management skills.

21

4.1. Global results
Innovation investment provides the
framework for innovation success.

Table 8. Percentage of staff rated good or excellent in key skills: global

Rank Good or excellent in key issues %
1 Building and maintaining relationships with the business 65%
2 Managing and prioritizing the It project portfolio 60%
3 Planning future It architecture and infrastructure 56%
4 Managing and prioritizing demand from the business 54%
5 Setting and managing It sourcing strategy 50%
6 Envisioning and re-designing business processes 43%

4.1.7. Innovation and collaboration: global
It was seen in section 4.1.5. that innovation remains one of the top priorities for CIOs
around the world. Consistent with previous results, a large majority of global CIOs,
83 percent this year, are being asked to provide technology innovation to improve
competitive advantage.

While it is encouraging to see technology innovation drive organizations out of recession,
it is concerning that over half, 55 percent, of global CIOs are not setting targets for
innovation. this may be the reason that 85 percent of the same community only enjoy
limited or reasonable success with their innovation projects.

On the global stage this year, it can be seen, in Figure 6, that innovation investment
provides the framework for innovation success.

Figure 6. Proportion of IT budget allocated to innovation: global

30%
27%
26%

25%

20% 17%

15% 15%
15%

10%

5%

0%
< 1% 1-3% 4 - 8% 9 - 15% > 15%

22

4.1. Global results
There are still many barriers to
collaborating on innovation projects.

Collaborating to achieve innovation success has also been a hot topic during the recession
and into the recovery. Eighty-nine percent of global respondents feel they are successful at
encouraging innovation collaboration within their technology teams.

the purpose for collaborating can be related directly to the priorities set by the business
(as outlined in section 4.1.5.). Sixty percent collaborate on innovation projects to enhance
the quality of projects and services while 58 percent use it to speed up development and
delivery of products and services.

Collaboration partners are similar throughout the different regions researched. Figure 7
below shows that suppliers and customers are the two groups favored by most CIOs
for collaboration.

Figure 7. Collaboration partners: global
60%
56%

50%

40%
34%

30%
30%

21%
20%

12%

10%
5%

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Over one-third of global respondents (35 percent) state there was no trigger to their
innovation collaboration activity. however, over half (50 percent) indicate that a change in
the market or a change in business focus, such as the recessionary pressures being exerted
on most organizations in the past 12 months, triggered their innovation collaboration.

While many global CIOs took advantage of the recession to drive new innovation activity,
there are still many barriers to collaborating on innovation projects.

23

4.1. Global results
Outsourcing and offshore development
will play an increasing role.

Table 9. Barriers to collaboration: global

Rank Barrier %
1 Lack of agreed behaviors for collaborating 28%
2 Resistance among potential users 18%
3 Physically dispersed teams 16%
4 Concerns about security 13%
5 Not being able to find the right people 9%
6 technology tools are ineffective 9%

the most severe barrier to collaborative innovation, as identified by global leaders, is a
lack of agreed behaviors for collaborating. this has become a more pronounced barrier
in the past 12 months and ranked ahead of having physically dispersed teams, which was
identified by many last year as the most significant barrier. Resistance from users remains
a potent barrier to collaboration as well.

4.1.8. IT budgets, outsourcing and offshoring: global
Although more than a quarter of global CIOs, 28 percent, actually saw an increase in It
budget during the recession last year, the majority, 43 percent, saw a budget decline.
Looking ahead to the next 12 months, a smaller portion of respondents, 29 percent,
anticipate further budget cuts.

Figure 8. 2010 expected IT budget change: global

Stay the same
29%
43% Decrease

Increase

28%

Although the pressure on It budgets is expected to ease in 2010, a strong focus on cost
savings and efficiency remains. the survey findings show that outsourcing and offshore
development will play an increasing role in these ongoing efforts.

In this global survey, almost half of the respondents, 48 percent, spend more than
10 percent of their It budget on outsourcing. this is a minor decline from 52 percent last
year but remains significant and the majority.

24

4.1. Global results
Outsourcing to offshore locations
has never been more popular.

Expectations for the next 12 months show that over one-third, 36 percent, will increase
their spend on outsourcing. this reflects a higher proportion of respondents planning
to increase outsourcing activity as recessions end and recoveries emerge. In addition to
those increasing their spend in 2010, 51 percent, will maintain their current outsourcing
spend, while a minority 13 percent will cut back their outsourcing activity.

the It activity most outsourced continues to be software application development, cited
by 62 percent of respondents. It infrastructure outsourcing also remains highly utilized
with 53 percent of respondents citing it as part of their outsourcing portfolios.
80

Figure 9. IT functions outsourced: global
70
62%

60% 53% 53%

50%

40%

30% 22%
20% 14%
8% 8% 6%
10% 1%
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Reflecting previous studies in Europe and the U.S., respondents to this global survey
placed cost control at the heart of their outsourcing strategies. thirty-nine percent of
respondents make this their highest priority while 35 percent argue that accessing new
skills not possessed by the internal It team is the most important reason to outsource.

Outsourcing to offshore locations has never been more popular with 90 percent of global
respondents maintaining or increasing their investment in offshore activity this year.
the favored destination continues to be India where two-thirds, 66 percent, of global CIOs
outsource activity.

however, the dominance of India appears to be eroding while other regions, such as
Eastern Europe, are becoming more prominent. Eastern Europe is growing in popularity
again this year with 11 percent of respondents locating projects there. the UK held the
third position at 10 percent. Meanwhile, emerging destinations such as Vietnam, the
Philippines and Brazil are growing in popularity year over year.

the percentage of global respondents whose expectations were not met by offshore work
has fallen for the second consecutive year. While those dissatisfied with their offshore
partners remains over one-third of the total, at 35 percent (down from 38 percent last
year). thirty-seven percent of global CIOs say that offshore work remains a key part of
their recession-busting strategies.

25

4.1. Global results
The global recession has forced CIOs to review
their career and compensation expectations.

4.1.9. Career and compensation: global
the global recession has forced CIOs to review their career and compensation expectations.
Early evidence of this trend was seen in the 2009 harvey Nash survey and the 2010 global
survey now confirms it.

CIOs are staying with their employers for longer: 43 percent have been at the same
organization for five years or more. the number who have been in their current role for
less than a year has dropped to 11 percent from 17 percent last year.

When looking to the future, there is a significant amount of career caution. those global
CIOs who are looking to move in the next 12 months are at a historic low of 25 percent.
however, within the next two years almost half, 48 percent, plan to be in new jobs.

there is also a slight dip in job satisfaction this year with 77 percent claiming to be fulfilled
or very fulfilled in their current role. this figure has historically been above 80 percent in
previous years and in all surveyed regions.

Figure 10. Level of fulfillment: global

5%

Very fulfilling
18%
32%
Quite fulfilling

Not very fulfilling

Not at all fulfilling
45%

One in five global CIOs (19 percent) are actively looking for their next job while another
43 percent are open to talking with headhunters about new opportunities.

the top two reasons CIOs give for looking for a new role are the need for a new challenge,
stated by 35 percent of respondents; and greater involvement in business strategy,
outlined by 24 percent.

Global base salary: Despite the recession, the base salary for CIOs around the globe
remains healthy with 82 percent earning more than $100,000 and almost one in five
earning over $200,000.

26

4.1. Global results
The recession has had an
impact on the size of bonuses.

Figure 11. Base salary: global
34%
35%
29%
30%

25%
19%
20%
13%
15%

10%
4%
5% 1%

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When asked about the impact of the recession on their base salary almost two-thirds,
62 percent, of CIOs say their base salary was frozen in 2009. Another 11 percent
received a base salary cut. Seven percent of global CIOs had a base salary cut of less
than 20 percent while 4 percent had cuts of more than 20 percent. Over a quarter of
respondents, 27 percent, were fortunate enough to have a base salary increase during
the last 12 months.

In addition to base salary, the range of benefits offered to CIOs from around the world
still includes pensions, car allowances, stock options and bonuses. Bonuses have been in
the news often in 2009 and 2010, mainly as a result of the banking industry. however,
a bonus remains the benefit of choice for most employers with 81 percent offering one.
Sixty-seven percent of CIOs are offered a contributory pension while share options are
provided to 40 percent of global respondents.

the recession has had an impact on the size of bonuses with 36 percent of global CIOs
having their bonuses reduced this year and a further 19 percent having their bonuses
eliminated entirely.

Dissatisfaction with remuneration is higher this year compared to last year with a quarter
of respondents, 25 percent, unhappy with their financial package. this is up from
20 percent last year. however, the majority of global CIOs are content and conscious of
the fragile economic position their organizations are operating in.

When asked if executive remuneration generally should be restrained until the economic
recovery is more robust, a resounding 59 percent agree that salary inflation should remain
tightly controlled for the immediate future. In addition, 72 percent say they would consider
freezing or reducing their own remuneration to help improve the financial stability of their
organizations as they emerge from the recession.

27

4.2. United States results
There has been a subtle shift in U.S.
reporting line towards the CEO.

4.2.1. Job roles: U.S.
the U.S. contributed a significant number of the respondents to the global survey in 2010.
In total, 467 leaders in technology from the U.S. participated, which represents 23 percent
of the total respondent population. the number of CIOs from the U.S. contributing to the
study is up 31 percent compared to 2009.

Ninety percent of all C-level respondents from the U.S. are senior technology executives
describing themselves as either a CIO or CtO.

Figure 12. Breakdown of respondents by job function: U.S.

5%

16%
C-level
30% Senior management

Mid management

Professional
49%

4.2.2. Reporting lines and board presence: U.S.
With the level of seniority in the U.S. respondent pool, it is not surprising to find that
over half, 56 percent, have responsibilities that stretches beyond U.S. shores. A further
31 percent of U.S. respondents have responsibility for technology across North America.

Reporting lines also reflect the seniority of participants with almost one-third of U.S.
respondents, 31 percent, reporting to the CEO or CFO. A further 13 percent report to
the COO.

there has been a subtle shift in U.S. reporting lines towards the CEO, 15 percent in 2009
to 21 percent this year, and the CFO, 7 percent in 2009 to 10 percent this year. It would
appear that during times of recession CEOs and CFOs from the U.S. are determined to
manage technology more closely.

28

4.2. United States results
U.S. CIOs have greater budget responsibility
compared to the global average.

4.2.3. Industry sectors: U.S.
Respondents from the U.S. are scattered across a range of industries.

Figure 13. Top industry sectors: U.S.
20%
20%

15%
15%

10%
10%
8% 8%

6%
4% 4%
5% 3% 3%
2% 2% 2% 2% 2% 2% 2%

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Information technology and financial services are the dominant sectors for U.S.
respondents, much as they are in the global respondent community. In the U.S., a slightly
larger percentage of respondents are from information technology, 20 percent compared
to 17 percent globally. healthcare is also more widely represented in the U.S., 8 percent,
compared to 5 percent globally.

4.2.4. Budget responsibility: U.S.
U.S. CIOs have greater budget responsibility compared to the global average. Globally,
2 percent of respondents manage a budget in excess of $1bn; however, 5 percent of U.S.
respondents have billion dollar-plus budgets to oversee. At the other end of the budget
spectrum, 36 percent of U.S. CIOs are responsible for a budget of $10m or less compared
to 50 percent globally.

there is more similarity in the middle tier of budget size between U.S. and global
respondents. In the U.S., 29 percent manage budgets of $10m to $50m U.S. and
globally 28 percent of respondents do. the remaining 30 percent of U.S. respondents
operate budgets between $50m and $1bn, compared to 20 percent globally.

29

Cio Survey2010 Us

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