perplexedNow more than ever, the strategic importance of IT is being recognized within all kinds of organizations. However there’s a problem. Business leaders are becoming more dissatisfied with IT’s inability to lead the way toward product and service innovation. As a result, executives want to spend less on IT operations and infrastructure and shift resources to revenue-producing areas.

The trend of dissatisfaction with IT is documented by the eighth annual McKinsey & Company Global IT Survey, which asks respondents about their company’s priorities for technology spending and use, as well as satisfaction with IT performance and effectiveness.

The two clearest shifts in priorities during the last three years are (1) the sharp decline in reducing IT costs and (2) the marked increase in improving effectiveness of business processes. But despite the promise of increasing investments and aligned priorities, overall satisfaction with IT performance—particularly within the IT organization—is down. Fewer respondents believe their IT organization is able to meet objectives and add value to the business.

As a result, one of the top initiatives that respondents believe will improve IT performance is to upgrade the overall level of talent and capabilities for IT staff members. But this initiative has its own set of challenges. Many executives indicated that senior IT leadership may need to change in order to realize an overall improvement in their IT staff. CIOs indicated they only spend 8 percent of their time developing talent, when improvements are clearly needed. Also lacking are the formal processes to govern IT talent and skills management.

To review the full report, find the McKinsey & Company results here.