Zero One: 10 Line-of-Business Tech Buyers
Find out how much they’re spending, what they’re buying, and whether or not they engage with the CIO.
![Zero One: 10 Line-of-Business Tech Buyers Zero One: 10 Line-of-Business Tech Buyers](https://eu-images.contentstack.com/v3/assets/blt10e444bce2d36aa8/blt84e0a610845cc5e4/6524607f7f33033c71ad1e86/promo_1.jpg?width=700&auto=webp&quality=80&disable=upscale)
In the rush to digitally transform business, line-of-business executives (LOBs) have seized the reins from the CIO in order to steer technology purchases. But how much of this is true? And who, exactly, are these LOBs? A recent Forrester study sought answers.
Forrester found that the CIO still controls a chunk of new project spending – forecasted $182 billion in 2018, largely for IT platforms and infrastructure. The CIO also controls practically all spending on maintenance fees, outsourcing agreements, telecommunication services, staff, servers, storage, network equipment and PCs, which Forrester calls MOOSE for maintaining and operating the organization, systems and equipment.
But LOBs are on the rise as tech spenders on new projects, Forrester says. Some control tech purchases from beginning to end. Others bring in the CIO after they’ve made the buying decision. Some collaborate closely from the get-go. Either way, there’s no question the LOB’s influence on tech is growing.
Based in Silicon Valley, Tom Kaneshige writes the Zero One blog covering digital transformation, AI, marketing tech and the Internet of Things for line-of-business executives. You can reach him at [email protected].
Forecasted 2018 U.S. tech spend on new projects: $109 billion
CAGR: 5%
Types of new projects: replacement of core transaction systems
Relationship with CIO: COOs tend to have a strong partnership with the CIO, collaborating on everything from identifying needs to implementation and follow-up.
Noteworthy: COOs are under enormous pressure to become more flexible and responsive to changing customer behavior in a digital world.
Forecasted 2018 U.S. tech spend on new projects: $28 billion
CAGR: 5%
Types of new projects: replacement of core systems
Relationship with CIO: CFOs tend to have a strong partnership with the CIO, collaborating on everything from identifying needs to implementation and follow-up.
Noteworthy: CFOs have a lot in common with CIOs, Forrester says, “including looking at the firm holistically, a bias toward preserving and conserving resources, and an emphasis on integrity and security.”
Forecasted 2018 U.S. tech spend on new projects: $26 billion
CAGR: 5%
Types of new projects: replacement of core systems
Relationship with CIO: Heads of Customer Service tend to have a strong partnership with the CIO, collaborating on everything from identifying needs to implementation and follow-up.
Noteworthy: Many contact-center solutions are still on-premises.
Forecasted 2018 U.S. tech spend on new projects: $22 billion
CAGR: 13%
Types of new projects: talent management, e-learning, recruitment management
Relationship with CIO: CHROs tend to initiate the buying-decision process, then bring in the CIO to help with vendor/channel selection, implementation and integration.
Noteworthy: CHROs will need CIO support when replacing core HRMS with a cloud solution.
Forecasted 2018 U.S. tech spend on new projects: $18 billion
CAGR: 15%
Types of new projects: marketing automation
Relationship with CIO: CMOs tend to control the whole purchasing process with little CIO input.
Noteworthy: CMOs are the fastest growing group of tech buyers.
Forecasted 2018 U.S. tech spend on new projects: $18 billion
CAGR: 13%
Types of new projects: cloud-based sales force automation
Relationship with CIO: Heads of Sales tend to initiate the buying-decision process, then bring in the CIO to help with vendor/channel selection, implementation and integration.
Noteworthy: Sales force automation projects need CIO support for data integration with core financial and HR systems.
Forecasted 2018 U.S. tech spend on new projects: $9 billion
CAGR: 13%
Types of new projects: e-sourcing, spend analysis, services procurement, supplier risk and performance management
Relationship with CIO: CPOs tend to initiate the buying-decision process, then bring in the CIO to help with vendor/channel selection, implementation and integration.
Forecasted 2018 U.S. tech spend on new projects: $8 billion
CAGR: 15%
Types of new projects: commerce
Relationship with CIO: Heads of E-commerce tend to control the whole purchasing process with little CIO input.
Noteworthy: Much of this spend comes from small businesses setting up e-commerce websites and larger firms setting up ordering features on mobile apps.
Forecasted 2018 U.S. tech spend on new projects: $7 billion
CAGR: 2%
Types of new projects: supply chain management, warehouse management, transportation management, demand-supply forecasting
Relationship with CIO: Heads of Supply Chain tend to let the CIO come up with solutions to business needs and then seek the business side’s validation and funding – i.e. tech’s traditional buying cycle.
Noteworthy: Many supply chain management solutions are still on-premises.
Forecasted 2018 U.S. tech spend on new projects: $5 billion
Types of new projects: cloud-based governance, risk and compliance
Relationship with CIO: Heads of Risk Management and Compliance tend to have a strong partnership with the CIO, collaborating on everything from identifying needs to implementation and follow-up.
Noteworthy: New projects need to be integrated to internal and external data sources, which requires working closely with the CIO.
Forecasted 2018 U.S. tech spend on new projects: $37 billion
Forecasted 2018 U.S. tech spend on new projects: $37 billion
Source: Forrester report “C-Suite Tech Purchasing Patterns” by Andrew Bartels.
About the Author(s)
You May Also Like