*CIOs, CTOs and technology leaders*
This article summarises the latest findings from PwC’s Pulse Survey.
CIOs steadfast on driving transformation and cost savings through tech
Recession, cutbacks, retrenchment. They aren’t slowing CIOs down. PwC’s third Pulse Survey of 2022 reveals that tech investments are on the rise. It may be counterintuitive, but there’s good reason for the relative boom times in the IT function. Technology is still seen as the most effective and reliable way to drive growth, improve efficiency and enhance ESG initiatives. It doesn’t matter what business function you analyse – IT is working behind the scenes to digitally transform it. For example, 97% of CIOs say they’re maintaining or increasing investments in finance transformation. And nearly all (98%) are doing the same for operations. The list goes on.
Technology is still seen as the most effective and reliable way to drive growth, improve efficiency and enhance ESG initiatives.
Meanwhile, CIOs are also trimming expenses by going digital and modernising outdated processes and equipment, improving sustainability efforts along the way. It helps that the modern CIO has an established seat at the C-suite strategy table. But that’s not to say that technology leaders see an easy time ahead. More than ever, they need to demonstrate a return on investment (ROI) of tech initiatives.
Looming budget cuts? Not for CIOs.
CIOs overwhelmingly say their businesses are continuing to invest in digital transformation initiatives across the enterprise. By and large, these investments are set to increase in the coming year, and at the very least maintain their current level for the vast majority of CIOs in our survey. When considering investments in supply chain transformation efforts, for instance, 57% of respondents tell us they’re increasing their budgets, 38% are maintaining existing budgets and only 2% are decreasing them. Those numbers are typical across almost all digital transformation categories, with five of the eight areas surveyed showing more than half of respondents seeing an uptick in investment levels.
How does this positive trend reconcile with the current economic situation, with 87% of CIOs and 90% of all executives saying they’re concerned about the macro environment? While it might be tempting to write this off as irrational exuberance, the technology function does in fact seem to be enjoying some level of insulation against widespread budget cuts. This paradox is likely explained by the recognition that competitiveness on the digital stage is paramount to overall success. CIOs understand that growth and efficiency requires investment in digital capabilities and they feel confident that they can deliver, recession or not.
CIOs overwhelmingly say their businesses are continuing to invest in digital transformation initiatives across the enterprise.
What you can do
Be prepared to prove your business case. Consider breaking up larger initiatives into more agile projects that enable you to demonstrate ROI along the way.
Invest in technologies, such as cloud and AI, that can drive efficiencies and transformation.
Don’t overlook change management. Make sure you can match the speed of adoption with that of development to achieve results.
Proactively engage finance and risk leaders to reap the biggest potential benefits. Tap tax leaders early on so they can help you identify the impact of taxable presence, withholding and indirect taxes and how R&D tax credits can help offset digital investments.
There may be a need for some CIOs to sharpen their focus and determine key priorities as they aspire to evolvetheir roles.
Efficiency efforts remain a top priority for CIOs
Part of increased tech spending is targeted at achieving organisational efficiency, a theme echoed in the August 2022 Pulse Survey. At that time, CIOs told us they spent about half their time focused there. Now, for example, 53% of CIOs say they are working to a great extent to replace physical events, processes and products with digital ones. And 52% are looking for ways to incorporate analytics into processes to drive better and faster decision-making. Automation, digital legacy infrastructure and self-service IT are also seen as top priorities for cost savings and productivity.
Cost cutting remains key across the enterprise, regardless of business conditions. Prioritise the strongest initiatives and build support for these efforts in the executive suite.
One clear priority area should be data. By modernising your data systems and unlocking the power of AI, you can use insights to build a road map toward further transforming functions and processes.
Align closely with the executive team and think broadly about how to transform digital capabilities into business growth.
There may be a need for some CIOs to sharpen their focus and determine key priorities as they aspire to evolve their roles. Having a strategic focus is the mark of what we call a ‘triple threat’ CIO, an executive who understands that mastery of technology, business and strategy are essential to help secure success, both for the business and for personal growth in the long run. In today’s environment it’s nearly impossible to pursue everything simultaneously.
