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What’s important to CIOs now
Topics shaping the technology agenda
Having a seat at the proverbial table used to be the rally cry for CIOs. Now, with technology powering much of business innovation and transformation, that’s not the main concern. Instead, tech leaders are juggling a packed agenda that requires them to call upon equal parts business savvy, strategic insight and tech experience as they work closely with their C-suite peers. These triple-threat CIOs are harnessing cloud, analytics, AI and emerging web3 technologies in pursuit of well-defined business outcomes, including advancing on ESG goals.
A high-tech paradox for CIOs as expectations mount
While advances like GenAI, AI and cloud offer incredible transformation potential, CIOs understand that taking full advantage means adapting the strategic operating model at the enterprise level, finds our latest Pulse Survey.
Transform via tech-powered outcomes
CIOs have dual agendas: capture efficiencies by accelerating the benefits of automation and focus on effectiveness plays like creating new digital revenue streams. Balancing these demands means keeping business outcomes top of mind so you can drive tangible results on shorter timelines. Your ability to lower costs or improve margins is a springboard for reinvesting those gains to reinvent the business. And how you achieve that transformation looks different today as well, often in a more modular — and measurable — way that brings change and value faster than the efforts of the past. This is particularly true when it comes to capitalizing on emerging tech like metaverse and web3.
Cloud — and its growing ecosystem — is a key ingredient to success on all fronts. Here, too, things have evolved. While many companies still have foundational work to do, the focus is no longer simply on migration or modernization. Instead, CIOs can migrate virtual machines to the cloud or reengineer applications in direct service to broader business objectives like growth, cost reductions or customer experience. In some cases, industry cloud solutions can help you jumpstart the process. The other crucial enabler? Talent, of course. As always, investing to develop, hire or contract in-demand capabilities through a managed services provider should be a priority. This is especially true in the areas of AI, cloud and emerging tech.
53%
of executives say their companies are increasing investment in digital transformation
Source: PwC Pulse Survey, August 2022
Reinvent through cloud-powered solutions
Most businesses today consider themselves to be “in the cloud”, but the value remains elusive. The big issue? Moving to the cloud or running parts of your business in the cloud is not the same as being cloud-powered.
About 10% of companies polled in our latest survey have cracked the cloud code — unlocking value at a rate twice that of other companies. What are four of the keys to success for these cloud-powered companies? It starts with a holistic approach to cloud, prioritizing C-suite collaboration, crafting a formal data, analytics and AI strategy and focusing on the overall cloud governance structure. This should be welcome news to CIOs who have been in the hot seat when it came to cloud’s unmet expectations and elusive return on investment — a hot topic in the C-suite known as the “cloud value gap”.
4X
Cloud-powered companies are four times more likely to say they face no barriers to achieving cloud transformation value
Prioritize data, analytics and AI strategy
Whether “data” is in your title or not, it’s an essential part of CIO responsibilities. Today, your data may be in silos across teams or perhaps not delivering the insights your people need. To help drive the business agenda and improve decision-making, customer operations and more, you need the latest data to drive real-time analytics across your organization. One emerging area that demands your attention: data collection, governance and reporting for environmental, social and governance (ESG) disclosures.
By modernizing your data systems and unlocking the power of AI and other data-powered capabilities, you can use insights to build a roadmap toward transforming functions and processes across your organization — customer journey, supply chain operations and more. Underpinning it all is a focus on data security and privacy and the responsible development and use of AI. At the same time, you’ll need to prioritize the AI and analytics capabilities needed to make it all happen — the top skills area CIOs said they’ll focus on in the coming year.
100%
of cloud-powered companies have improved decision-making through cloud transformation
Take a lead on ESG
Like technology, ESG affects every area of your company. From net zero and emissions reductions to customer privacy and stakeholder reporting, it permeates the business. And in nearly every area, technology plays a big role. Given tech’s outsize impact on ESG, it’s essential to actively partner with key ESG stakeholders like the CEO, CFO and chief sustainability officer.
Data is a natural starting point. In fact, it’s the key to telling a credible story and delivering on commitments. But many companies are challenged to gather operations data and confirm it is accurate, consistent and secure. That’s just the beginning. Scope 3 reporting, which affects your value chain, may mean dealing with supplier data and furnishing your own customers with emissions data for your products. Analytics dashboards and a new breed of cloud-based sustainability solutions that integrate with your enterprise systems can help meet these demands.
As you guide your company through tech-driven transformations, you should also consider your own carbon footprint. What’s the environmental impact of different solutions and how can you drive innovation more sustainably? This is especially important with power-hungry tech like AI and blockchain. At the same time, virtual reality, digital twins and the metaverse can provide more carbon-friendly options for training, collaboration, product or process design and events.
52%
of CIOs say their companies will increase investment in ESG over the next year
Source: PwC Pulse Survey, August 2022
Be a growth driver
With technology no longer the CIO’s domain alone, a new breed of tech leader is needed to deliver growth. What does it take? Combining proficiency in technology, business savvy and strategic insight, “triple-threat” CIOs are guiding their companies’ leadership teams in defining the tangible outcomes tech can help deliver — and charting the course to get there. A key part of that plan will likely focus on change management and matching the speed of adoption with that of development to achieve results.
Taking on a more strategic role may require personal growth and a shift in priorities. CIOs tell us that the next 12 months will see their role split fairly evenly among three focus areas: 35% on improving costs and efficiencies, 34% on implementation and tech-enablement of IT services and 28% on growing the business. This split speaks to how the CIO role is evolving, with most tech leaders seeing their mandate as one that goes well beyond IT.
57%
of CIOs say they play a role in actively defining corporate strategy
Source: PwC US Pulse Survey, August 2022
Team up with your tax, finance and risk peers
As the CIO, you’re on the hook for the technology decisions that drive strategy. But you’re not in it alone, as most C-suite leaders are actively shaping and influencing digital transformation. Working together has always been important, but now it’s essential.
Where should you pay extra attention? Proactively engage finance and risk leaders at the outset of initiatives to see the biggest potential benefits. As cloud spend and revenue grow, for example, there is a greater chance of exposure to global tax controversies and reputational risk. By tapping your tax leaders early in the process, they can help you examine taxable presence, withholding and indirect taxes, sustainable legal entity structures and more. R&D tax credits against US federal and state taxes can offset digital investments.
Cybersecurity continues to be the top concern for business leaders, making it crucial for CIOs and CISOs to be in lockstep. Identifying cybersecurity, data privacy and cloud-specific risks and then building in adequate controls and technology solutions is essential to success. Also on the CISO agenda: building cyber resilience, creating better alignment with the business and sourcing desperately needed talent, among other priorities. These are all critical for CIO success as well, so it makes sense to join forces.
5+
functions teaming at the start of transformation projects is a key factor in achieving cloud value
Invest in new and emerging technologies
You should develop a strategy for capitalizing on emerging tech, from AI and blockchain to quantum computing and web3, today while building out a path to longer-term value and new business models. The key technologies we call “the Essential Eight” continue to advance and converge in new ways — like in the metaverse. Companies that don’t begin experimenting, piloting proofs of concept (PoC) and building skills in these areas will likely find themselves disadvantaged.
Wherever you focus — a digital asset loyalty program, VR training in a metaverse campus, or a digital twin for your supply chain — you should consider trust. How do you develop technology and engage with customers, business partners and communities in a responsible and ethical way? Along with building in such considerations and collaboration from the outset, it may make sense to work with industry and other groups to define and promote common principles and standards.
In your role as an emerging tech evangelist, you should also educate the rest of your company’s leaders, including the board, on why these projects matter and what they mean to the business now and in the future. Where it makes sense, let leaders get hands-on with PoCs and experience how the technology is changing how employees or customers interact.
26%
of technology leaders say blockchain is part of their business strategy; 23% say the same of VR and 13% of web3
Develop cloud, AI and web3 talent
Talent has consistently topped the CIO agenda and it’s as crucial as ever. Without deep functional knowledge and tech know-how, transformations can fail to deliver. When asked to rank the most important skills to develop over the next year, data analytics and AI skills topped the list. Skills related to cloud-native development and integration ranked second.
At the same time, more than one-fifth of CIOs say cultivating web3 and metaverse skills is a current priority. This number is surprisingly high given these are relatively new areas. It’s also consistent with what business leaders told us in our metaverse survey, that talent is their No. 1 priority to advance their metaverse strategies this year. Investing early in specialized talent can help you capitalize on tech building blocks like virtual reality, augmented reality and digital assets today.
How can you compete with all the other companies looking for the same in-demand skills? Most CIOs will likely take a blended approach, both hiring and developing in-house talent, as well as relying on third-party providers and managed services. Some companies are creating certification programs for such specialties as data science, data engineering or platform-specific functions. Others are providing training for those in the business who can take advantage of low- and no-code platforms. You might also cultivate relationships with universities, community colleges and even high schools as you continue to fill your tech talent pipeline.
41%
of CIOs say data analytics and AI skills are the most important skills needed by their teams
Source: PwC Pulse Survey, August 2022
