Gartner predicts "zero-budget" CIO. (Up front: news, trends & analysis).

Gartner research and advisory firm recently warned that unless CIOs achieve the same recognition as other executive leaders, businesses will lose control of their IT strategy and fail to achieve the fusion between business and IT strategies that is essential in the connected economy.

"The CIO is facing a real prospect of becoming a `zero-budget CIO' by the end of the decade," said John Mahoney, Gartner vice president and research director, speaking at Gartner's Spring Symposium in Florence, Italy. "This does not reflect a decrease in stature, it reflects irreversible changes in the business environment which the CIO must meet head on."

According to Gartner, CIOs are facing growing pressures. As businesses increasingly realize they must focus on core capabilities, there are corresponding changes in the way companies acquire capabilities and resources. Gartner said that less than 15 percent of business process outsourcing contracts--one of the fastest-growing parts of the services sector--are signed by CIOs. At the same time, CIOs have faced some loss of confidence from the business in IT's ability to deliver business benefits. Gartner said CIOs urgently need to build credibility for themselves and their departments.

"The challenge for CIOs is to define and deliver a sustainable value proposition from the IT organization to the enterprise in an environment with increasing turbulence in technology, business and the economy," Mahoney said. "That value will center more on leadership and service integration and less on creation of technology. That doesn't mean the end of the CIO as a distinct role, but it does mean that major changes lie ahead."

Gartner states the single most important CIO success criteria lies in developing leadership and soft skills, such as the right behaviors, to influence and get buy in from other parts of the business.

Gartner has identified a "CIO Success Cycle," which includes four key behaviors that determine the success of a modern-day CIO:

* Lead: CIOs are traditionally good managers but not good leaders. This must change. CIOs have a unique perspective across the enterprise and need to exploit this through networking with the right people within the organization. Starting to lead from the back can earn the right to a place at the executive table and achieve true IS leadership for the business.

* Shape Demand: CIOs need to be more proactive in engaging with the key players in the organization to understand the business and to ensure they have real input into shaping demand from the executives.

* Set Expectations: Project failures often result from unrealistically high expectations. CIOs need to ensure that they know what can be achieved realistically, and become proficient at negotiating effectively with the board and propose alternative solutions without souring relationships.

* Deliver: CIOs need to address changing business needs and create appropriate partnerships--internal or external--to achieve this. Focus more on creating architectures to drive the way IS organizations deliver results.