Geopolitical and macroeconomic uncertainty, fallout from the generative AI explosion, and the need to prioritize on a budget top the list of tough, ongoing issues CIOs must navigate this year.
2023 was a year made notable by a range of unexpected, unpredictable, and fast-moving challenges that, despite seemingly having little to do with technology, had profound impacts on IT strategies. Add the rapid rise of generative AI, and the past year was one in which CIOs often found themselves on the back foot, reacting to disruptions and shifting strategies in real-time.
To get back in front, IT leaders will have to transform lessons learned from 2023 into actionable, adaptable processes, as veteran technology pros have been remarkably consistent in identifying global and economic uncertainties as key challenges for IT leaders to anticipate in 2024 as well.
Read on to see the pain points tech leaders consider to be their biggest challenges to achieving business profit and growth — and how they plan to address them in the new year.
Navigating uncertainty
Like many IT leaders, Saket Srivastava, CIO of Asana, believes ongoing lack of economic clarity on a wide scale, paired with instability in the tech market, will create new challenges for 2024. These external factors can have a dramatic impact on business operations and strategic planning.
Amid the restraints, however, Srivastava sees opportunities. In the case of Asana, capitalizing on these will require a commitment to being cost conscious, with an eye toward achieving efficiencies wherever possible, and then strategically deploying the savings that come from reevaluating the company’s operations.
“We are giving our budget and proposed projects more scrutiny to invest in areas that have clear attribution toward generated increased revenue, more efficiencies, lower costs, and improved workplace experiences,” Srivastava says. “This increased scrutiny is actually a good thing, because having a level of constraint forces teams to make better decisions and recommendations.”
To guide an organization through uncertainty, IT leaders must help ensure everyone in the company is on the same page, Srivastava says. Instead of playing catch-up, he suggests a proactive approach with clear communication as a guiding principle.
“It starts with establishing a clear set of agreed upon initiatives and outcomes for the organization,” he says. “We have to make sure everyone understands what they are doing, why they are doing it, and — most importantly — how success will be measured.”
Srivastava believes employees will stay motivated if they can see their work is meaningful and delivers value to the company.
“Misalignment between teams and unclear objectives create uncertainty, confusion, and dissatisfaction,” he says. “Instead, we’re focusing on regular communication, candid transparency, and repetition — they are the keys to success. It should be very easy for anyone in the organization to understand progress on these initiatives and outcomes. Teams need to have this information so they can quickly respond to issues and keep things on track.”
Creating a strong work culture
One upside to all the uncertainty companies are facing, says Dan Zimmerman, CIO and CPO of TreviPay, is the increasing ability to find talent, as the competitive labor market has heated up.
“Recent job postings [at TreviPay] have attracted dozens of qualified applicants without using recruiting firms,” Zimmerman says. “This past year has proven to be a great time to build the team you need for the next few years.”
But more than just adding talent, IT leaders must ensure they are creating a positive, respectful work culture that benefits employees and company goals, Zimmerman says.
“Team members derive culture through policies, procedures, and most importantly how respected they feel by leaders and co-workers,” he says. “It will be important to listen and gather feedback on what is and isn’t working — and remain flexible.”
Varied work arrangements (in office, hybrid, and fully remote), which can boost job satisfaction, engagement, and retention, will further challenge IT leaders’ ability to establish and maintain a winning culture. Reducing those challenges starts at the top, and requires meaningful ways to measure success.
“The key to maintaining our strong work culture includes leaders leading effectively with appropriate communications technologies in all work arrangements,” Zimmerman says of TreviPay’s approach to this issue.
“Embracing these changes, including implementing and encouraging use of the necessary technology, will help position us for success in 2024,” he adds. “We’ve strategically focused on integrating teams with diverse work arrangements to embrace the dynamics of the modern workplace.”
Delayed decision-making
Bhadresh Patel, chief digital officer at global consulting firm RGP, sees organization’s showing more caution than usual. He attributes the cautious attitude of tech leaders to elevated inflationary pressures and higher interest rates.
“The budgets are still there, but decisions are taking longer as companies apply more scrutiny to ensure they are pursuing the right initiative and choosing the right partners,” Patel says. “Our latest research shows that large companies are taking on an average of 20 $1 million-plus initiatives this year alone. Decision-makers expect to take on even more of these types of projects in the next few years, but we are seeing clients in some regions exhibit caution in new spend.”
At RGP, Patel is countering that issue by focusing on operational efficiency, reducing costs, and modernizing back-end processes to make his colleagues’ workflow process easier.
Alexei Miller, managing director at DataArt, says the biggest challenge faced by tech leaders is the fear of sunk cost and betting on the wrong projects for the future.
“Too much is up in the air, from funding availability to corporate priorities to pricing to electoral politics across the world,” Miller says. “IT leaders know they have to make big things happen — there is no more easy work — but those require some reasonable assumptions about the future, which are hard to come by. How can we start something knowing we might have to change or stop it tomorrow? And yet we must. More than ever, we have to be agile and be unafraid of waste. Waiting for clarity is pointless. The world — and business — is stumbling from one crisis to another and it’s not going to stop any time soon.”
Miller says his organization is making the choice to invest in growth. “We believe that smart technology still holds the biggest promise to improve our client’s operations,” he says. “Waiting is a losing strategy.”
Security — on a budget
Security is a challenge that makes the list of top CIO worries perennially, but Grant McCormick, CIO of cybersecurity company Exabeam, notes a rising need for increased collaboration between IT and security teams to address the issue.
“The role of the CIO has recently seen a massive convergence with cybersecurity,” says McCormick. “Regardless of whether or not security reports into the CIO, or another leader within the company, it is in everyone’s best interest to be conscious of the organization’s security posture and to enable IT and cybersecurity to work in a highly synchronized manner.”
2023’s State of the CIO survey found 70% of IT leaders anticipate an increased involvement on their part in cybersecurity operations going forward. Moreover, 58% reported that cybersecurity protections have increased due to the state of the economy, which is also putting pressure on their budgets to do so, as only 40% of CIOs reported increased budgets based on the need for security improvements this past year.
Balancing cost and agility
Aref Matin, CTO at Wiley, says the speed of change has caused tech leaders over the past year to seek balance between optimizing costs and preparing to adapt quickly to changes — two priorities that are frequently at odds.
“We must ensure that our projects are the right ones,” Matin says, “and that they are improving business performance and driving efficiency. I think it’s safe to say the speed at which we need to move continues to increase.”
Geopolitical and economic issues have prompted rapid changing situations that require organizations to change course quickly, he says.
“In today’s environment technology leaders must constantly have different and multiple scenarios ready,” Matin says. “It makes for more work in planning and budget cycles, but inevitably leads to less waves and disruptions if and when we need to adapt.”
Upskilling to take advantage of AI
Sastry Durvasula, chief information and client services officer at TIAA, is among the many IT leaders who sees significant potential for AI — but only if employees are trained on how best to make the most of the technology.
“The rise of these solutions and their various use cases present a level playing field for employee upskilling and reskilling initiatives — perhaps the most in a generation,” he says.
The challenge is in preparing the organization to take advantage of these opportunities, which he refers to as the reskilling revolution.
To address this, TIAA has created a program to help workers across the company upskill in AI, among other areas of strategic importance to the company, such as security and data. The program also empowers employees to earn industry certifications. The company has also partnered with universities to create internships to work on collaborative generative AI projects that benefit the company’s clients.
“CIOs can leverage this as a critical lever to competitive differentiation not only to help their employees grow in their roles and develop technical acumen, but make the entire organization as a whole more AI-savvy,” he says.
Dealing with new regulations
Regulation is on the rise across most industries, but few are as regulation-centric as healthcare, where G. Cameron Deemer, CEO at DrFirst, sees dealing with regulations as both a challenge and opportunity.
“Healthcare IT is particularly vulnerable to regulatory change,” Deemer says. “For the next 12 months, I’ll be asking my team to continue their focus on innovation and clearing up tech debt, and will also need to add a focus on upcoming regulatory requirements that will dramatically impact our company and our clients.”
For IT leaders also facing new regulatory environments in the coming year, Deemer offers new perspective on what is often considered an onerous challenge for IT.
“Regulation is both a blessing and a curse,” he says. “It creates real business opportunities to win new clients but also complicates and reprioritizes the development roadmap. We’re treating it as a ‘good luck event,’ which, although inconvenient, will give us another opportunity to demonstrate strong value to existing and potential customers.”
Mixing human and machine intelligence
An ongoing challenge for Jamie Smith, CIO at University of Phoenix, is removing frictions and highlighting opportunities for the university’s students. Addressing these customer needs means making decisions about what aspects of the experience should be addressed by human intelligence and which ones will best be served by digital solutions.
“The effort requires evaluating the massive advances in machine learning, AI, and personalization, which may help to curate individualized journeys and allow us to apply our human talent to the most beneficial and nuanced situations while arming them with ‘bionics’ to better handle each situation.”
As in other industries, the institution will need to refine the mix of human resources and AI approaches in light of rapid new advances and newly identified customer needs.
“The biggest change in the last year,” she says, “has been the emergence of large language models and generative AI that hold out the possibility that AI, along with human review and input, can deliver sophisticated and complex experiences. The rate of advancement in these models will continuously cause us to reevaluate what is possible in the upcoming 12 months.”
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