A sizable chunk of midmarket businesses is asking IT to do more to innovate for top line growth. However, CIOs at these companies face their own considerable internal problems, such as security asset and manpower deficits. This situation is making it that much more difficult for them to meet their business demands.
Experts agree the way is hard for the CIO. “The challenge of the fast pace of IT innovation is the increased exposure to security risks, staffing needs (to match the talent/training required for the quickly changing landscape) and of course, finding ways to manage costs,” comments Henry Chace, CIO at Burns & Levinson LLP, a noted full-services Boston-based law firm.
"The simultaneous acceleration of emerging technology and industry-changing business platforms, combined with the increased sophistication and frequency of security threats, require the pace of IT value delivery to significantly eclipse historical levels," notes Doug Pontious, BI analytics executive at Amerisure Insurance. "Today, many CIOs are constantly challenged to quickly deliver innovative solutions that drive strategic business transformation, but with essentially static talent and funding levels."
Middle market companies are themselves choking on basic but intractable challenges. These include finding new customers, cutting costs, and acquiring and keeping talent. And, of interest to the mid-enterprise information technology leaders, one of the other biggest stumbling blocks is being able to innovate.
So notes the recently released National Center for the Midmarket’s third-quarter report, based on survey data. As already noted in this blog, the National Center’s report offers a mixed bag of findings, with employment rates up, but revenue down. The report also notes more middle market organizations want to grow faster, which is proving an especially thorny problem.
Challenges To Grow In Midmarket
So, it thus follows that two-thirds of companies planned capital investments. The report notes the larger middle market companies were the most likely to spend; the one-third segment that planned to save their cash tended to comprise core midmarket businesses.
And the survey reported a litany of problems midmarket companies face, mostly routine. They include proper talent management and finding ways to cut costs, particularly in the areas of health care expenditures and government regulations compliance. And, of course, companies are all facing growing competition.
The survey’s response indicates the most aggressive businesses will turn more to IT solutions and talent to compensate. Of the roughly 64 percent of the investing companies, some 14 percent intended to put their dollars into IT. As the report explains: “Companies rely on innovation to tackle some of these key challenges, and many focus on attracting and retaining innovative people.”
Big Three IT Issues For Midmarket
But, as noted, midmarket CIOs are struggling with major threats that hurt their capacity to help. For instance, according to a recent CIO survey (sponsored by Midsize Enterprise Strategies), there are three basic but severe threats to overcome in the next 24 months. The first midsized enterprise challenge is security (28 percent), which can be a critical game changer for a midsized company.
Besides facing security failures, IT managers also must cope with other basic, and potentially severe, threats: staffing (20 percent) and budgets (15 percent). How to succeed for all parties? Chace suggests IT more tightly align with business and work out strategies that intertwine everyone’s problems and solutions.
As he states: “These challenges all lead to the need for IT leaders to become trusted business advisors with a stake in the success of the business and a permanent seat at the table of senior leaders who determine the future of the business and map a business plan to increased prosperity.”
In the meantime, while working on such long term goals, there are things midmarket CIOs can do today to help. As Pontious notes, participating in the Midsized Enterprise Summit provides "opportunities to establish strategic relationships with vendor partners that can often ease much of the typical technical solution and delivery related burdens."