Home » Future Ready » Functional buyers: the new IT influencers on the block
One of the most common misconceptions is that the CIO is solely responsible for IT purchasing in organisations. It is a myth that permeates through the technology industry and affects both the sales of systems and services, and the adoption of these technologies in the host business.
The IT purchasing arrangement is, in fact, a much more nuanced arrangement. The digital transformation has been accompanied by a decentralisation of IT buying, such that individuals across the business can buy technology on demand, often with or without the say-so of the CIO.
In this new arrangement, functional buyers play a crucial role, helping the organisation to judge the value of a new technology before purchase and implementation. So how can organisations make the most of these functional buyers and what is the impact of this role on IT procurement, both now and into the future?
Research from Bain & Company suggests almost one-third of technology purchasing power has already moved outside IT. The cloud has been a huge contributing factor, helping non-technology executives to buying systems and services on-demand.
Bain & Company also point to an accompanying shift in the type of technology being bought. Rather than traditional IT systems, more organisations are directing their IT spend towards new digital workflows, such as mobile ad targeting and delivery.
The $1.5 trillion invested in marketing and communications worldwide in 2012 is expected to grow to $1.7 trillion by 2017, reports Bain & Company. Two-thirds of that growth will come from new digitised workloads – and the executives who best understand those workloads come from non-IT departments, such as marketing, finance and human resources.
This shift in spending creates a consequential effect on the role of the CIO. IT leaders must embrace this change, spending less time on the operational concerns associated to traditional IT and more time on helping the business make best use of the technology that functional buyers look to procure.
Gartner refers to this shift as bi-modal IT, where CIOs must split their time effectively between both operational and change concerns. Functional buyers can play a key role in assisting this shift. These line-of-business heads understand their specific business requirements and they know the cloud can help secure services quickly and on-demand.
By working closely together, CIOs and functional heads can bring together their two fields of experience, which is governance on the part of the CIO and business demand in terms of the functional head. Smart CIOs understand the shift is already occurring, as do the leading technology vendors that sell products to these functional buyers.
The shift towards functional buying, and the change in emphasis in role for the CIO, explains why so much IT management literature is directed towards terms like engagement, communication and collaboration. Modern businesses must talk about IT.
There is, after all, more choice in terms of systems and services than ever before – and the tech-savvy line-of-business executive understands the potential of technology in more detail than the IT professional. That rise of the functional buyer can be good news.
Leading CIOs recognise the power of this trend and place account executives in the IT department close to the business to fully comprehend their requirements. What emerges is a new model of IT influence, where business and IT work in harmony to create better solutions for internal users and external customers.
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