Technology consultancies can expect to come under increased pressure from their clients after research released on June 21 signalled the intent of Chief Information Officers (CIOs) worldwide to squeeze more value from their outsourcing arrangements.

According to the report, From Cost to Value, published by KPMG International, the renewed outsourcing focus is symptomatic of CIOs’ wish to place the topic of getting value from their IT as their top priority.

The report suggests that the new, post credit crisis, CIO agenda is dominated by securing value for money but that it also wants to focus on using IT to help transform the business in terms of innovation and productivity.

Outsourcing appears to have fallen some way from the top of the CIO agenda in its own right, suggesting that outsourcing is now just part of ‘business as usual’ to a typical CIO. However, over two-thirds of the 4500 CIOs surveyed for this report indicated that they now expect to pay far more attention to the price:quality ratio they currently experience. Even more expect to be bringing increased pressure to bear on their sourcing providers.

The report makes clear that this is just one aspect of the move towards a value-driven agenda. Eighty-one percent of the survey respondents feel that getting value from their IT must be their top priority. Cost optimisation trailed in a distant second (58 percent of respondents), ahead of portfolio management (51 percent) – although it could be argued that both of these could be seen as sub-sets of the overall theme of extracting value from IT investments.

The transformational shift is evidenced by the fact that sixty-five percent of respondents felt that IT could assist in enabling and driving business innovation while a similar number felt it could assist with increased productivity. Over half also saw IT’s potential for enabling competitive advantage and improving external customer satisfaction. These are not the responses of CIOs who still see IT’s predominant role as an operational cost centre. Accordingly, the survey shows that the bulk of CIOs expect to be judged by how they create business rather than by how they control costs.

Not all CIOs are making this move from an operational mindset to a transformational mindset at the same pace. The KPMG research suggests that CIOs in the financial sector see themselves as remaining heavily involved in operational matters, with a focus on risk and compliance issues; something which may in part be attributable to a credit crisis hangover. By contrast, their counterparts in the manufacturing sectors claim to be focusing more on ways to innovate and transform their business with the help of IT.

Not that this means that financial sector CIOs do not have transformational ambitions or that other CIOs have consigned their risk and compliance requirements to the past. Rather, it simply suggests that both groups have differing priorities at this point in time. In fact, argues Cruickshank, striking a balance between operational and transformational priorities is all part of a new reality whereby risk and compliance objectives are fused with commercial and business objectives. In turn, this is leading to a fundamental change in the way in which business approach the twin challenges of innovation and transformation within their organisation.

Click here to view KPMGs full report