Only 1% of CIOs have deployed blockchain in their organisation, according to Gartner's 2018 CIO Survey, as IT business leaders struggle to find the real business value behind the hype.
Just 8% of the more than 3,000 CIOs in 98 countries that Gartner surveyed had short-term plans to adopt the distributed ledger technology, while more than three quarters (77%) of them had no plans to use blockchain.
The survey suggests that many people who claim to be deploying blockchain are in fact just slapping a buzzword on other forms of database.
"They seem to be calling something blockchain which arguably is existing technology, and from our perspective, that's going to be more expensive," Gartner Fellow and vice president David Furlonger told CIO UK.
"It'll add to TCO [total cost of ownership] because of an integration of risk and a whole bunch of other things and they're forgoing the potential that blockchain affords in terms of tokenisation and decentralisation."
Those CIOs who are exploring blockchain are struggling to find the necessary skills and accommodate the changes to their operating and business models that blockchain will enforce.
The level of adoption varies widely across sectors. CIOs from insurance and financial services remain at the forefront of blockchain deployment, while transportation, government, telecoms and utilities sectors are gaining interest, but many of their blockchain initiatives would be more successful if they used other technology.
"If all people are doing is basically recreating another form of central database, or just providing more effective messaging between known entities of that central database, I'm not sure that that's where blockchain is going to drive particular value," said Furlonger.
Changing role for CIOs
The role of CIO now puts a greater emphasis on becoming a change leader, with increased and broader responsibilities including innovation management and talent development.
CIOs are therefore spending more time on the business executive aspects of their job. CIOs from top performing organisations are now spending up to four days more on executive leadership than they were three years ago.
"We're seeing CIOs perhaps being given more opportunity by business leaders to really move the organisation forward," said Furlonger. "Not just in a technical sense, but as an organisation, to try and grow more revenue."
Furlonger added that not all CIOs feel capable of taking on this challenge, as they may not be familiar with these other aspects of the business.
He says CIOs can grow into this changing role by providing their organisations with a more detailed understanding of user needs.
"The CIO to some extent is arguably best placed to that because, of course, they have access to the information," he said.
"They can organise collection of different kinds of data and analysis of that data as the Chief Information Officer. I think that's really where the immediate role lies. After that, I think it gets more into strategic intent and how technology can fundamentally help the business in a very different way."
Impact of digitalisation
Gartner's survey also revealed that 95% of CIOs expect their jobs to change or be remixed due to digitalisation, but their willingness to change isn't always realistic.
"There seems to be a disconnect between that desire and an ability to actually do it in a scaled fashion," said Furlonger.
"Executing on the intent seems to be a challenge. The data tends to suggest that that challenge is not a technical challenge, but it's more a challenge of internal organisation structure operations.
"Cultural factors inhibit the kinds of changes that would be required for the organisation to become more digital. The message there is that CIOs will find that tough to deal with because it's not directly in their sphere of responsibility."
Cultural change is a general problem for CIOs. Furlonger says they need to educate employees on their new responsibilities and the role played by technology plays in them and make staff personally accountable for their actions.
"I think there's an opportunity to change the old structures to be more team-centric, smaller teams, more empowered teams, more innovative team structures," he said.
Exploring emerging technology
Growth was the main priority for CIOs in 2018, as reported by 26% of respondents reported. They hope to achieve this by finding new forms of revenue, business value and engagement through digitised products and services.
To do this, 71% of the top performers that were surveyed have a separate digital team to help them scale their digitalisation efforts, which Furlonger said were centred on updating current practices.
"Much of the focus around digital seems to be with respect to automating existing processes," he said.
"So in a sense, more of a re-platforming of the way that the firm has operated and the products and services that they've used for the last several decades, rather than necessarily a re-imagining of the business itself."
Business intelligence and analytics remain the most valuable technologies for CIOs, and top performers are most likely to consider them strategic.
CIOs surveyed rank AI, followed by digital security and the Internet of Things, as the most problematic technologies to implement, but they are nonetheless showing more immediate value than blockchain.
"Things that can help improve convenience and speed of response and things like that are useful," said Furlong.
"I think at some point you will see aspects of blockchain come to the fore, but I don't think it's going to be in the immediate future."