Why the New Normal Could Kill IT

McKinsey's Chui says that it's imperative that CIOs and IT understand the ever-changing technology wants and needs of not only internal users and managers but their company's external customers. "Some [of this new] demand comes from new hires and more IT-savvy managers," Chui says. "But part of it really comes from the new normal, where you are seeing customers and consumers who have an increasing amount of power and knowledge, partly because the discussion around brand doesn't occur through paid advertisements any more. That makes it incumbent on the business to understand those sorts of technologies and how you interact."

Don't Be Afraid of a Little Failure.

The imperative for CIOs is to explore and experiment with so-called disruptive technologies (Web 2.0, social media, cloud computing) that users and customers have embraced. But IT can't be intimidated by failure, said several leading CIOs at the recent National Retail Federation show. For instance, Neville Roberts from Best Buy said: "CIOs must foster the right culture so [IT staffers] don't have a fear of trying new things. There's always a new shiny toy out there," reported Evan Schuman at Storefront Backtalk. McDonald's CIO David Grooms added: "You should try and fail really small.... You test, take some risks, adjust and go back. But you really can't take that long. You can't take three years to develop an app. You must launch and learn."

Be Ready: More Will Be Asked of You Than Ever Before.

Cut and grow: That's essentially what's being asked of CIOs right now, say Lundberg and Chui. "I call it the 'CIO's Dilemma': How do you create efficiency, on one hand, and help grow the business, on the other," Lundberg says. "It's a business dilemma, too. But it's the CIO's Dilemma because IT is really at the core of how businesses operate." In fact, CEOs are expecting good things from their companies in 2010: 74 percent of executives interviewed for a McKinsey survey expect a rise in profits in 2010, versus only 46 percent in 2009.