CIOs face a tough challenge in 2022/23 as they balance the need for technology investment and growth amid a growing call for fiscal prudence in uncertain economic conditions.
Enterprises worldwide are making massive changes to their business operations and in how they provision new services and customers as they continue to adapt to the fallout from the COVID-19 pandemic.
Meanwhile, recent market shifts are sharpening companies’ focus on the bottom line and on delivering practical value rather than just growing the customer base.
As a result, CIOs find themselves having to balance two sometimes competing needs in 2022: supporting new services to gain a competitive advantage and cutting costs.
One solution for many enterprises is to shift more core business applications to the cloud and consolidate their tech stacks to gain efficiency. Moving systems to the cloud also promises to open new analytics opportunities, providing companies better insight amid uncertain economic conditions.
The upshot is that in 2022, CIOs find themselves under pressure to find technology that can support business agility.
Here are nine key trends and priorities CIOs will need to address in 2022.
1. Adopting a single technology vision
Sush Apshankar, principal consultant, technology modernization, for technology research and advisory firm ISG, expects more CIOs to establish a single technology vision. This will entail a change in how many large global enterprises have dealt with acquired companies and with multiple lines of business in the past, which was to let them keep their own technology stacks. In 2022, CIOs will be increasingly tasked with consolidating these tech stacks to improve business performance.
“Establishing a single technology vision is easier said than done,” Apshankar said. CIOs will have to work closely with C-level and other business leaders to define which set of technologies (for cloud environments, ERP systems, business intelligence (BI) platforms and CRM tools) will be the mainstay of the organization. Legacy and inherited technologies will be integrated into these mainstay technologies.
The challenges are multifold. Each cloud, ERP, BI and CRM system has its own benefits. The teams and business units that have been using legacy systems will need training on new systems. Data migration and system integration take time, effort and specialty skills.
2. Preparing for next-gen technology services
CIOs are also laying the groundwork to adopt a variety of promising technologies in different states of maturity. They include next-generation analytics, IoT, metaverse and Web 3.0.
“In our experience, most enterprises are running multiple, parallel initiatives on the future state of technology services, ranging from operational efficiencies to the metaverse environment,” Apshankar said.
In vetting these new technologies, CIOs will need to consider the potential they offer for cost savings and new monetization opportunities related to offering better customer experiences. But this can be a tricky balancing act.
“When businesses focus on multiple technology initiatives, they lose momentum and efficiencies,” Apshankar said. The CIO needs to direct the enterprise’s resources so that all these technology initiatives are seamlessly interwoven and implemented before they lose their impact.
3. Practicing fiscal prudence
At the same time, the uncertain economic climate will spur CIOs to prioritize cost management initiatives in 2022, including cloud spend analysis and ROI analysis.
“CIOs must quickly change their organizational focus from heavy technology investments to value-based technology investments and yield management of technology services,” Apshankar said.
Cloud platforms, BI tools and CRM systems have increasingly relied on pay-per-use models in the past few years. Apshankar recommends CIOs and their teams check for the ROI they obtain from these platforms. They also should explore using data monetization tools to help generate incremental revenue from the large swaths of enterprise, product, supplier and customer data they’re sitting on.
4. Using the cloud for core business applications
Early cloud implementations typically involved cutting-edge new applications, and now the rest of the enterprise is starting to catch up, said Colin Dawes, chief solutions architect at Syntax, an IT consultancy service.
“For the year 2022, CIOs will encourage increased adoption of the cloud for the core business applications of CRM/SCM/ERP/HRMS and other line-of-business applications, which is a change from the cautious approach of years past,” Dawes said.
At the same time, applications focused on new technology and digital transformation, such as IoT, will increasingly go cloud native, in tandem with a cloud-first mentality for business analytics.
The main advantage of moving core business applications to the cloud is the increased visibility of accurate and reliable information about the business presented in a timely, efficient and cost-effective manner. “The need for this type of technology has only grown more critical in the past few years through the pandemic,” Dawes said.
5. Adopting cloud to support a distributed workforce
The growth in the number of people working from home and in distributed scenarios is also pushing CIOs to invest more in cloud infrastructure to support this dispersed workforce.
The increased reliance on the cloud in remote work environments means CIOs need to closely manage their cloud architecture to ensure it is secure and provides a seamless experience for end users. CIOs will need to ensure both employees and end customers can securely and reliably work with data stored across multiple locations.
“With more people working from home than ever, we will continue to see a push toward cloud migration and, in most cases, a multi-cloud architecture,” said Jamshid Rezaei, CIO at Mitel, a contact center service provider.
6. Building a digital collaboration culture
The COVID-19 pandemic dispersed the workforce and drove the adoption of new work-from-home practices on a massive scale. Even as many employees return to the office, CIOs are playing a growing role in supporting a hybrid workflow that spans home, office and distributed workers. Now, the demands of an increasingly dispersed workforce require CIOs to adapt and take on lead roles in addressing major business decisions about employees, office spaces and other investments.
“A top priority for CIOs in 2022 is digital collaboration culture, or identifying the tools and systems their organizations need to strengthen remote and hybrid employee collaboration long term, despite growing economic uncertainty and tightening budgets,” said Randall Ward, CEO and co-founder of Appfire, an app integration service.
CIOs will increasingly be tasked with demonstrating that their companies’ work-from-home capabilities are equal to, if not better than, working from the office. This will allow managers and executives to consider new distributed work approaches as a valuable complement to the office, rather than the emergency measure as it was during the pandemic. That means putting collaboration and access to necessary systems at the center of the workplace experience — no matter where an employee works.
7. Developing a unified data management architecture
Bhrugu Pange, managing director in the digital and technology practice at AArete, a management consultancy, said that in 2022 CIOs will need to develop a cohesive data management architecture. A big driver is the increasing assortment of SaaS, PaaS and Cloud platforms as enterprises upgrade their technology stack and data platforms. The orchestration of the underlying data is critical to serve the right information to applications, platforms, employees, customers and other constituents.
A variety of middleware platforms are starting to address aspects of data orchestration. But none currently handles all the use cases around transactional, analytical, data science and streaming, Pange said. He expects to see more CIOs developing a cohesive data management architecture that positions the various tools — middleware, traditional ETL/ELT tools, data lake(house)s, messaging applications, reverse ETL and cloud data warehouse in a modular, optimized and secure fashion to address these use cases.
Pange recommends CIOs develop a flexible blueprint in the short to mid-term, acknowledge the technical debt of fast-moving technology projects, and create a remediation plan. “The alternative is an explosion of data silos, out-of-synch applications, a low-trust environment where every fact has to be fact-checked several times, and unhappy constituents,” Pange said.
8. Exploring new data analytics
CIOs also need to explore how new data analytics technologies can provide a faster and more accurate picture of the organization, Rezaei said.
“We now have the ability to gain a deep understanding across a myriad of attributes from new and emerging analytics tools, and there’s so much we can now leverage to drive innovation and growth within our organizations,” he said.
Rezaei said his team is exploring different ways to use analytics to strengthen the company’s own business performance. They are also collaborating with global partners to ensure end customers can utilize analytics for their own benefit.
9. Meeting the challenge of the ever-expanding role of the CIO
In years past, the CIOs focused predominantly on back-end IT services. But in 2022, expect to see the role of the CIO become even more complicated and with higher expectations overall.
Dan Priest headshotDan Priest
“Lately, we are seeing how mission creep and eagerness among leaders to take on new projects are shaping the CIO role,” said Dan Priest, cloud and digital leader at PwC. “This is ultimately a good thing, as it positions CIOs as more prominent and strategic members of the C-suite.”
Executives are starting to realize that the right tech is an intrinsic part of defining a business strategy and, in turn, has the potential to drive new business models. CIOs are now working with their C-suite colleagues to execute these new business strategies and make critical decisions about their tech investments.