With large enterprise business technology decision-making and budget spending now residing with Line of Business (LoB) leaders, rather than traditional IT leadership, the Chief Information Officer (CIO) role must demonstrate strategic skills.
By 2028, 80 percent of CIOs will leverage significant organizational changes to harness AI, automation, and analytics, driving agile, insight-driven digital businesses.
CIOs must become key players in shaping the future of their companies, guiding them through new trends while putting data at the heart of their business strategies, according to the latest market study by International Data Corporation (IDC).
CIO Business Skills Market Development
IDC research identified the top 3 concerns among C-suite executives were in digital skills, the lack of LoB trust in IT, and the lack of digital business know-how of C-suite executives.
Given this backdrop, the major challenge for CIOs is transitioning from being a technical manager to a strategic architect, driven by the influence of operational business leaders, and the complexity of modern digital platform requirements.
IDC emphasizes CIOs’ critical shift towards AI integration in business strategies. These predictions show a pressing need for CIOs to adapt and innovate, and highlight the growing significance of Generative AI (GenAI) in shaping business practices:
- Optimized IT Investments: By 2024, 65 percent of CIOs will face pressure to adopt digital technology, such as GenAI and deep analytics, but limited IT support will diminish the benefits and heighten risks.
- AI Strategy and Governance: About 55 percent of CIOs will team up with LoB executives to establish robust federated governance for cohesive AI strategies, driving swift and seamless GenAI adoption in worker augmentation and automation by 2025.
- AI for Digital Reinvention: By 2024, 35 percent of CIOs will embrace GenAI, securing an early short-term advantage over competitors while cultivating a foundation of talent, experience, and training data.
- Rethinking Software Strategy: By 2025, 55 percent of CIOs will leverage business-savvy in-house developers and tools that use GenAI and low- or no-code tools as they and LOB developers build competitive differentiation through custom apps.
IDC believes in a holistic approach for the future where technology is the central pillar of business strategy. Their latest forecast extends beyond the realm of AI, casting a wide net over the critical spheres of cybersecurity, data culture, resilient leadership, ESG compliance, and trust-driven customer engagement.
Together, these elements underscore the necessity for CIOs to architect a comprehensive technology approach that is seamlessly interwoven with every facet of business operation to remain competitive and secure in the rapidly evolving digital landscape.
- Embedded Cybersecurity: By 2026, 75 percent of CIOs will integrate cybersecurity measures directly into systems and processes to proactively detect and neutralize vulnerabilities, fortifying against cyber threats and cyber breaches.
- Data Culture: By 2025, 40 percent of CIOs will prioritize strategic data management and foster a data-centric culture, ensuring competitive differentiation in the digital era.
- Resilient Leadership: Two-thirds of CIOs will not meet their 2025 digital revenue goals because of misaligned investments hindering business performance.
- ESG for Competitive Advantage: To mitigate legal risks and enhance their brand and competitive advantage, nearly half of CIOs will be motivated to automate regulatory compliance and ESG by 2025.
- Trust-Driven Engagement: By 2026, 45 percent of CIOs will forge unified strategies with CMOs, dismantling silos of customer data to enable the delivery of expected engagements within a trusted digital experience.
Outlook for Digital Business Transformation Leadership
"As we navigate a world transformed by technology, the imperative for CIOs is clear: evolve or be left behind. CIO's role is to embed technologies like AI into the very DNA of business as a strategic ally in addressing business challenges and opportunities while ensuring their data is secure and regulatory requirements and ESG goals are met," said Franco Chiam, vice president at IDC.
According to the IDC assessment, it's this fusion of vision and vigilance that will define the successful CIOs of Asia-Pacific and beyond. Strategic business skills are no longer optional.
That said, I believe this shift implies being able to translate digital business objectives into technology solutions and thereby harness capabilities like GenAI and automation. Therefore, it will be crucial for legacy CIOs to adapt to the changing decision-making landscape within organizations.