What Keeps CIOs Up At Night

Reflections from Our Technology Leader Advisory Council Retreat

By Greylock Partners

In the past decade, the role of the CIO has increasingly shifted from a back-office IT manager to a strategic driver for the business. IT has become a core element in decision making as board members look to technology leaders (including CIOs, CTOs, and CDOs) as experts on current enterprise trends and how to leverage technology to gain the competitive advantage. Topics like security and data integration, once considered “just an IT” issue, are now board-level issues. New technologies like machine learning and AI are starting to make their way into the enterprise, opening up possibilities for IT-inspired innovation that can improve customer engagement and increase revenue.

Greylock has been fortunate to build strong, durable relationships with many technology leaders of large enterprises. Through these relationships, Greylock has a deeper understanding of enterprise priorities and technology agendas, and we are able to get input on investment areas and feedback on early-stage companies. In exchange, technology leaders gain insight on where the market is headed and meet early stage software companies in priority areas for potential implementation.

Earlier this summer, we held our inaugural Technology Leader Advisory Council. Invited CIOs, CTOs and technology leaders from leading enterprises joined us in San Francisco to get to know and learn from each other as a group. They heard from industry experts on topics ranging from deep learning to security, including a panel with founders sharing a “behind-the-scenes” view of what it takes to build an enterprise software company. While all of our conversations during the summit were off-the-record, we wanted to share a few learnings from our discussions:

Migration to the cloud (predictably) continues to play out

• On average across our panel, the enterprises represented are running about 30% of their workloads in the cloud or SaaS — and they expect this number to double, on average, in the next three years as they migrate more legacy applications
• Given the rising complexity of managing multiple environments, technology leaders want better cloud orchestration tools to manage their different environments. Their ideal: a single pane of glass for all resource and workload management
• Technology leaders believe containers may help manage some of this complexity, but they are still in the early days of experimenting with it in development
• Containers still represent only 13% of workloads, with most in VM’s (72%) and a small amount still on bare metal (15%)

Data aggregation gaining increasing importance as a key differentiator

• Technology leaders are increasingly thinking about how they can drive value from one of their company’s biggest assets — its data. But much of the data sits in many disparate systems, which are often physically segregated across on-prem or cloud environments.
• Data aggregation is a big technical hurdle for companies looking to drive differential value for their organizations via their data assets. Key questions then arise: who will aggregate the data? Where will it be stored? Is it possible to make it accessible and searchable across the systems where it currently resides, without having to put it altogether?
• Everyone recognizes this question will only grow in importance and complexity, as the proliferation of data in the enterprise continues (e.g., with more connected devices and sensors in the enterprise)

Security, security, security — still a top CIO (and board-level) priority

• Security is considered one of the top three technology priorities. Several attendees even report directly to their Board about their security posture on a quarterly or annual basis (one executive recalled that it was “the scariest 15 minutes of my quarter!”).
• As executives continue to allocate significant budget to security, the focus on buying best-in-breed for each (increasingly niche) category has led to an explosion of point solutions in the enterprise. Some attendees said they were running upwards of 50 different solutions.
• As the burden for integrating all of these solutions falls to the buyer, many technology leaders wishfully dream of one solution — an “ERP for security” — to rule them all.
• Despite all of the effort and spend, most are still not confident in their security posture (and suspect they may have been breached in the last year).

Machine learning is capturing more attention…although it’s still early days in the enterprise

• All attendees agree that machine learning has significant potential for their businesses, although they are still in the early days of thinking about potential applications. (Not surprisingly, security was the first and most commonly discussed use case.)
• Regardless of use case, everyone agrees that collection of and access to the right data will be critical. As such, they believe most applications should be a collaborative effort between IT and the lines of business.

Let us know what you think of these trends, and if you have any feedback or thoughts this post.