Government CIOs Spend 21% Of IT Budget On Digital Initiatives

Top-performing organizations in the private and public sectors, on average, spend a greater proportion of their IT budgets on digital initiatives (33 percent) than government organizations (21 percent), according to a global survey of CIOs by Gartner.

For 2018, organizations anticipate spending 43 percent of their IT budgets on digitalization, compared with 28 percent for government CIOs.

Gartner pointed out that 2016 proved to be a watershed year in which frustration with the status quo of government was widely expressed by citizens at the voting booth and in the streets, accompanied by low levels of confidence and trust about the performance of public institutions.

“This has to be addressed head on. Government CIOs in 2017 have an urgent obligation to look beyond their own organizations and benchmark themselves against top-performing peers within the public sector and from other service industries. They must commit to pursuing actions that result in immediate and measurable improvements that citizens recognize and appreciate,” said Rick Howard, Research Vice President, Gartner.

Top Performers Secure Greater Budget Increases
Government CIOs as a group anticipate a 1.4 percent average increase in their IT budgets, compared with an average 2.2 percent increase across all industries. Local government CIOs fare better, averaging 3.5 percent growth, which is still more than 1 percent less on average than IT budget growth among top-performing organizations overall (4.6 percent).

“Whatever the financial outlook may be, government CIOs who aspire to join the group of top performers must justify growth in the IT budget by clearly connecting all investments to lowering the business costs of government and improving the performance of government programs,” Mr Howard said.

Government Prioritizes Top Tech Investment
Advanced analytics takes the top spot across all levels of government (79 percent) for technologies with the most potential to change their organizations over the next five years. Digital security remains a critical investment for all levels of government (57 percent), particularly in defense and intelligence (74 percent).

The Internet of Things will clearly drive transformative change for local governments (68 percent), whereas interest in business algorithms is highest among national governments (41 percent). All levels of government presently see less opportunity in machine learning or blockchain than top performers do. Local governments are slightly more bullish than the rest of government and top performers when it comes to autonomous vehicles (9 percent) and smart robots (6 percent).

Biggest Barriers for Government CIOs
The top three barriers that government CIOs report they must overcome to achieve their objectives are skills or resources (26 percent), funding or budgets (19 percent), and culture or structure of the organization (12 percent).

Drilling down into the areas in which workforce skills are lacking, the government sector is vulnerable in the domain of data analytics (30 percent), which includes information, analytics, data science and business intelligence. Security and risk is ranked second for government overall (23 percent).

“Bridge the skills gap by extending your networks of experts outside the agency. Compared with CIOs in other industries, government CIOs tend not to partner with startups and midsize companies, missing out on new ideas, skills and technologies,” Mr Howard added.

Seize The Digital Ecosystem Opportunity
The concept of a digital ecosystem is not new to government CIOs. Government organizations participate in digital ecosystems at rates higher than other industries, but they do so as a matter of necessity and without planned design, according to Gartner. Overall, 58 percent of government CIOs report that they participate in digital ecosystems, compared with 49 percent across all industries.

As digitalization gains momentum across all industries, the need for government to join digital ecosystems — interdependent, scalable networks of enterprises, people and things — also increases.

 

Gartner’s 2017 CIO Agenda survey includes the views of 2,598 CIOs from 93 countries, representing USD 9.4 trillion in revenue or public sector budgets and USD 292 billion in IT spending, including 377 government CIOs in 38 countries. Government respondents are segmented into national or federal, state or province (regional) and local jurisdictions, to identify trends specific to each tier. For the purposes of the survey, respondents were also categorized as top, typical and trailing performers in digitalization.

Add Comment