Business Forum • 26 November, 2024 at 10:44 AM
The use of artificial intelligence (AI) will result in an increase in revenues, 66% of companies estimate, and 33% of them expect an increase of at least 10%, according to a study conducted by Horváth, a global management consulting company active on the Romanian market since 2005.
Entitled "Adaptative IT 7.0", the objective of the study was to find out how the main IT managers in companies - Chief Information Officers (CIOs) or equivalent positions - relate to the challenges related to digital transformation, the advance of artificial intelligence, ESG implementation, the risks of cyberattacks and others. An adequate response to all these challenges will require streamlining the work of IT departments and a gradual transformation of the roles performed by CIOs today.
Thus, beyond those already listed, a major challenge is that 54% of IT executives expect budget cuts in the coming years, while 10% of respondents anticipate an increase in spending on innovation.
In the face of budget pressures, companies are investing in smarter and more automated solutions, with only 28% (down 12% from the previous survey) still using all-in-one solutions, while 41% (up 8%) will invest in specialized tools. SAP, ServiceNow and IBM remain the main vendors, but niche solutions are rapidly gaining ground.
In terms of priorities for companies, artificial intelligence (AI) and machine learning (ML) were indicated as essential for 77% of respondents, with most likely to be deployed in logistics (+8%), operations (+6%) and finance (+3%). However, AI integration is not without challenges: 69% of respondents anticipate significant efforts to ensure AI compliance and governance, and 61% see data protection and security as major obstacles.
Revenue growth as a result of AI implementation will not be realized until investments are initiated. As such, 30% of companies expect a 5% increase in IT-related costs, while 18% expect a 10% increase in expenses associated with AI.
Beyond growing revenue, sustainability and digital responsibility are becoming imperative for IT organizations. Currently, only 24% of companies are using advanced tools to automate ESG reporting, and 43% are having difficulty complying with data protection regulations. However, 79% of organizations are aware of ESG requirements, but few (37%) have developed detailed strategies and comprehensive sustainability communication.
The changes also affect the role of those in CIO positions: by 2027, only 18% of CIOs will remain solely in technical roles, down from 39% today, and the majority (82%) will take on expanded responsibilities such as Chief Digital and Information Officer (CDIO) or Chief Technology and Information Officer (CTIO).
The role of CDIO will grow by 8% and Chief Process Innovation Officer (CPIO) by 9%, while IT departments will increasingly take on more responsibility for business process management, from 42% today to 57% in the next three years.
"The Horváth survey shows that executives in the position of Chief Information Officers and IT specialists need to adapt quickly to meet the multiple challenges, and are mostly optimistic about the impact of artificial intelligence on companies' revenue growth. Regardless of the size of budgets or the difficulty of the challenges, the key to success is team adaptability, with IT leaders being the first called upon to take on new roles and anticipate trends that will shape future growth," said Maria Boldor, Partner and Managing Director, Horváth Romania.
The "Adaptive IT 7.0" study surveyed 312 respondents (42% executives and other IT managers) from over 15 industries in eight countries.