Reading through the excellent Node4 Mid-Market Report, I was immediately struck by the ongoing dissonance between tech leaders and the business. Tables of stats showing that, despite years of this issue being obvious, we are seemingly still far away from bridging the gap between the two worlds.
Tech investment is up, but priorities are misaligned
Odd then that 84% of mid-market organisations are responding to the current economic climate by either increasing or maintaining their tech investment. So there is clearly no fear of spending on tech. But where they see it being spent is revealing, especially when you consider that business leaders have been reducing IT headcount or implementing hiring freezes as their second priority, compared to IT leaders who see investing in automation and AI as their second priority.
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Perhaps these are simply two sides of the same coin. IT see the automation approach as a way of reducing tech costs, but it requires investment, and businesses see simply having fewer people in IT as the answer to controlling costs. The one that stood out to me is that addressing IT skills shortages is the number 8 (and lowest) priority for IT leaders.
When we dig deeper into the skills shortage, we find 93% of the mid-market are experiencing tech skills shortages, with 56% significantly impacted. And the answer? Nearly half the organisations are using external consultants or contractors. The areas of shortage are no surprise: data science, AI, and cyber are all up there, but what interested me is that nobody mentioned the CIO. Neither tech nor business. Perhaps not surprising, as the survey was undertaken with tech leaders, but it does surprise me that the business didn’t identify the lack of a strategic CIO as an issue.
I believe that the ongoing dissonance between the business and tech functions is a relatively simple solution and the solution would also fix many of the issues being faced by mid-market businesses. Hire a business-savvy CIO. Hire somebody who can see through the lens of the business and apply technology to it. But CIOs like that are very expensive, which is often the blocker.
The Mid-Market Report reveals the strategies that are working and the ones that aren’t.
The case for a business-savvy CIO
A business-savvy CIO will create a strategy that is predicated on the business. That will create a framework that can be used to structure the use of third parties effectively because they will be provided with a clear, unambiguous remit. What do I mean by this?
Without a well-defined, business-centric strategy, any ‘consultant’ who is engaged will apply their own experience and views to the problem in front of them. This means the solution you receive will be theirs, which is not necessarily the best one for you. Which then exacerbates the dissonance again. It’s a cycle of ‘not quite good enough’.
Interestingly, the report also suggests that 97% of mid-market organisations are planning to migrate some or all of their workloads out of the public cloud. Why? Because the lift and shift drive to the cloud simply didn’t work. Another example of a strategy driven by consultants. Ask a cloud consultant the best destination, and guess what? The answer will be cloud.
Again, this smacks of the lack of a business-centric tech strategy, so let’s look at why this comes about. One of the primary reasons is that IT rarely holds a seat on the main Board in the mid-market and so how do they gain access to the real decision-making?
Fair question. Is this a lack of understanding by the business or a lack of capability in tech leaders? That may seem a harsh question, but I think we are at that point where harsh questions are needed. If we are to align on AI adoption, which is another area where the business and tech leaders appear to disagree, we need the business to lead. But we need it to lead with technology at the forefront, and whilst tech leaders are excluded from the board, that is never going to happen.
We constantly hear about the need for business and technology to align, but the 2025 report suggests this is still an issue. We don’t need it to align. Alignment suggests the business decides, and tech follows. We need tech to be embedded in business. To be a fundamental element, as important in the decision-making process as marketing, operations and HR. We don’t need it to be a subsidiary function that reports into either the COO or the CFO and takes orders. This just leads to Chinese Whispers and constantly misfiring projects and misaligned consultants.
Discover how leading mid-market organisations are rethinking the role of tech leadership and reshaping their future.
The need for integrations
Throughout the report, we see the dissonance. Even remote working is still a struggle for two-thirds of the organisations, and yet, when explored, most of the issues are an inability to use highly established technology to effectively engage the workforce. Why is this an issue? Because the tech solution has been put in with a tech focus, and the users and the organisation are struggling to use it.
Interestingly, nearly half of tech leaders describe their business as ‘data-driven’, but half of business leaders say they are ‘data-informed’. They use data but still lean heavily on human judgment. This perception divide illustrates very neatly the opposing views of tech and business. It is highly indicative that tech leaders feel that data alone is enough, whereas the business relies on the human element that, in their eyes, got them to this place.
It matters not who is right. What matters is the difference in perception.
Throughout this excellent report, it is clear that as more technology emerges, more competitive advantage is available, more radical change is on the horizon, and we still have the business/tech divide. The bridge between that divide is, and always has been, investing in the right kind of tech leader and creating a specific, equal voice at the Board table.
Unlocking Growth in the Mid-Market: The Node4 Report
The 2025 Node4 Mid-Market Report reveals how business and IT leaders can close the productivity gap and unlock their next growth phase, with insights from 600+ decision-makers across six sectors.
In an era of economic uncertainty, the UK’s mid-market continues to power ahead – but something’s slowing it down. Based on original research with over 600 IT and business leaders, this report exposes the key tensions holding mid-sized organisations back: misalignment between teams, underused technology, and stalled transformation efforts.