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IBM Study: C-Suite Confidence in Delivering Basic IT Services Wanes, While Tech CxOs Focus on Gen AI Demands

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IBM's Institute for Business Value study reveals a decline in C-suite confidence in IT's ability to deliver basic services, dropping from 69% in 2013 to 47% in 2024. Simultaneously, 43% of tech CxOs report increased concerns about their technology infrastructure due to generative AI demands. The study highlights a shift in budget allocation, with expectations to spend 50% on hybrid cloud and AI combined over the next two years.

The research also uncovers a disconnect between tech CxOs and CFOs in strategic planning, despite CEOs emphasizing the importance of their collaboration. Notably, organizations linking technology investments to measurable business outcomes report 12% higher revenue growth. The study also reveals gaps in implementing responsible AI practices and addressing talent shortages in key technology areas.

Lo studio dell'Institute for Business Value di IBM rivela un declino della fiducia dei dirigenti nella capacità dell'IT di fornire servizi di base, scendendo dal 69% nel 2013 al 47% nel 2024. Allo stesso tempo, il 43% dei CxO tecnologici riporta preoccupazioni crescenti riguardo alla propria infrastruttura tecnologica a causa delle richieste generate dall'AI. Lo studio mette in evidenza un cambiamento nell'allocazione del budget, con aspettative di spesa per il 50% su cloud ibrido e AI combinati nei prossimi due anni.

La ricerca scopre anche una disconnessione tra CxO tecnologici e CFO nella pianificazione strategica, nonostante i CEO enfatizzino l'importanza della loro collaborazione. In particolare, le organizzazioni che collegano gli investimenti tecnologici a risultati aziendali misurabili riportano un 12% di crescita del fatturato in più. Lo studio rivela anche lacune nell'implementazione di pratiche di AI responsabile e nella gestione delle carenze di talenti in aree tecnologiche chiave.

El estudio del Institute for Business Value de IBM revela un declive en la confianza de los altos ejecutivos en la capacidad de TI para ofrecer servicios básicos, cayendo del 69% en 2013 al 47% en 2024. Al mismo tiempo, el 43% de los CxOs tecnológicos reportan preocupaciones crecientes sobre su infraestructura tecnológica debido a las demandas de la IA generativa. El estudio resalta un cambio en la asignación del presupuesto, con expectativas de gastar el 50% en nube híbrida e IA combinadas durante los próximos dos años.

La investigación también descubre una desconexión entre los CxOs tecnológicos y los CFOs en la planificación estratégica, a pesar de que los CEOs enfatizan la importancia de su colaboración. Notablemente, las organizaciones que vinculan las inversiones tecnológicas a resultados empresariales medibles reportan un 12% más de crecimiento en ingresos. El estudio también revela vacíos en la implementación de prácticas de IA responsable y en el abordaje de la escasez de talento en áreas tecnológicas clave.

IBM 비즈니스 가치 연구소의 연구에 따르면, IT 서비스 제공에 대한 경영진의 신뢰 하락이 나타났으며, 2013년 69%에서 2024년 47%로 감소했습니다. 동시에, 43%의 기술 CxO가 생성적 AI 요구로 인해 기술 인프라에 대한 우려가 커지고 있다고 보고했습니다. 이 연구에서는 예산 배분의 전환이 강조되며, 향후 2년 간 하이브리드 클라우드와 AI에 대한 지출이 50%에 이를 것으로 기대하고 있습니다.

연구는 또한 기술 CxO와 CFO 간의 전략적 계획에서의 단절이 드러나며, CEO들이 그들의 협력의 중요성을 강조하고 있음에도 불구하고 발생하고 있습니다. 특히, 기술 투자를 측정 가능한 비즈니스 성과에 연계한 조직은 12% 더 높은 매출 성장을 보고합니다. 이 연구는 또한 책임 있는 AI 관행의 구현과 주요 기술 분야에서 인재 부족 문제를 다루는 데 있어 격차가 있음을 보여줍니다.

Une étude de l'Institut pour la valeur commerciale d'IBM révèle un déclin de la confiance des dirigeants dans la capacité de l'IT à fournir des services de base, passant de 69% en 2013 à 47% en 2024. Parallèlement, 43% des CxO technologiques signalent des préoccupations croissantes concernant leur infrastructure technologique en raison des exigences de l'IA générative. L'étude met en avant un changement dans l'allocation budgétaire, avec des attentes de dépenser 50% en cloud hybride et IA combinés au cours des deux prochaines années.

La recherche révèle également un décalage entre les CxO technologiques et les CFO dans la planification stratégique, malgré l'accent mis par les PDG sur l'importance de leur collaboration. Notamment, les organisations qui lient les investissements technologiques à des résultats commerciaux mesurables rapportent une augmentation de 12% de la croissance des revenus. L'étude révèle également des lacunes dans la mise en œuvre de pratiques d'IA responsables et dans la gestion des pénuries de talents dans des domaines technologiques clés.

Die Studie des Institute for Business Value von IBM zeigt einen Rückgang des Vertrauens der Führungskräfte in die Fähigkeit der IT, grundlegende Dienstleistungen zu erbringen, die von 69% im Jahr 2013 auf 47% im Jahr 2024 gefallen ist. Gleichzeitig berichten 43% der technologischen CxOs von wachsenden Bedenken bezüglich ihrer Technologieinfrastruktur aufgrund der Anforderungen durch generative KI. Die Studie hebt eine Änderung der Budgetzuweisung hervor, mit Erwartungen, dass in den nächsten zwei Jahren 50% für hybride Cloud und KI kombiniert ausgegeben werden.

Die Forschung offenbart auch eine Trennung zwischen technologischen CxOs und CFOs in der strategischen Planung, obwohl die CEOs die Bedeutung ihrer Zusammenarbeit betonen. Bemerkenswerterweise berichten Organisationen, die technologische Investitionen mit messbaren Geschäftsergebnissen verknüpfen, von einem 12% höheren Umsatzwachstum. Die Studie zeigt außerdem Lücken bei der Umsetzung verantwortungsvoller KI-Praktiken und bei der Bekämpfung des Fachkräftemangels in wichtigen Technologiebereichen auf.

Positive
  • Organizations connecting technology investments to measurable business outcomes report 12% higher revenue growth
  • Tech CxOs expect to allocate 50% of their budget to hybrid cloud and AI combined over the next two years
  • 70% of tech CxO respondents view regulatory change as an opportunity
Negative
  • C-suite confidence in IT's ability to deliver basic services declined from 69% in 2013 to 47% in 2024
  • Only 39% of tech CxOs collaborate with finance to embed tech metrics into business cases
  • 58% of tech CxOs report difficulty filling key technology roles
  • Most organizations are falling short on delivering core responsible AI practices at scale
  • 54% of tech CxOs cite financial pressures as hindering their ability to invest in technology talent

The study reveals a significant shift in C-suite perceptions of IT effectiveness, with confidence in basic IT services declining sharply over the past decade. This trend, coupled with the increasing focus on generative AI, signals a pivotal moment for tech leaders.

The 50% budget allocation for hybrid cloud and AI over the next two years indicates a strategic pivot towards next-gen technologies. However, the gap in responsible AI practices is concerning. Only 50% of respondents delivering on explainability, with even lower figures for privacy, transparency and fairness, highlights a critical area for improvement.

Tech CxOs must address these challenges while navigating talent shortages and regulatory uncertainties. The anticipated skill scarcities in cloud (+36%), AI (+29%) and security (+25%) underscore the need for robust talent strategies and partnerships to remain competitive in the AI era.

The study highlights a crucial disconnect between tech CxOs and CFOs, potentially impacting financial performance. With only 39% of tech CxOs collaborating with finance on tech metrics and just 35% of CFOs engaged early in IT planning, there's a clear opportunity for improved alignment.

Notably, organizations that link tech investments to measurable business outcomes report 12% higher revenue growth. This underscores the financial benefits of strategic tech-finance collaboration. The shift towards generative AI and hybrid cloud investments presents both opportunities and challenges for financial planning and resource allocation.

The increased spending on hybrid cloud (29% more than AI currently) suggests a balanced approach to infrastructure modernization. However, CFOs must carefully evaluate the ROI of these investments, especially given the declining confidence in basic IT services delivery.

The study reveals a concerning gap between the importance placed on AI transparency and the actual implementation of responsible AI practices. With 80% of CEOs emphasizing the criticality of transparency, yet only 45% of tech CxOs delivering on it, there's a significant ethical risk.

The low delivery rates on key responsible AI capabilities - explainability (50%), privacy (46%) and fairness (37%) - indicate a substantial ethical deficit in current AI implementations. This gap could lead to reputational damage, regulatory issues and eroded trust among stakeholders.

Interestingly, 70% of tech CxOs view regulatory change as an opportunity, compared to 50% of CEOs. This proactive stance could be leveraged to build robust, ethical AI frameworks that align with emerging regulations, potentially creating a competitive advantage in the rapidly evolving AI landscape.

  • CEO confidence in the effectiveness of basic IT services nearly halves over 10 years
  • 43% of surveyed tech CxOs say concerns about their technology infrastructure have increased because of generative AI

ARMONK, N.Y., Aug. 21, 2024 /PRNewswire/ -- A new IBM (NYSE: IBM) Institute for Business Value study found that while IT leaders are preparing organizations for accelerated generative AI adoption, C-suite executives' confidence in their IT team's ability to deliver basic services is declining.

The global study* of 2,500 of C-level technology executives (tech CxOs) from 34 countries revealed that less than half (47%) of those surveyed think their IT organization is effective in basic services compared to 69% surveyed in 2013. Today, only 36% of surveyed CEOs and 50% of surveyed CFOs believe IT is effective at basic services, down from 64% and 60%, respectively since 2013.

At the same time, 43% of surveyed tech CxOs say their concerns about their technology infrastructure have increased over the past six months because of generative AI, and they are now focused on optimizing their infrastructure for scaling generative AI. Respondents report they are currently spending 29% more on hybrid cloud than AI, and, over the next two years, they expect to spend half (50%) their budget on hybrid cloud and AI combined.

As tech CxOs prioritize generativeAI-ready infrastructure investments, two-thirds of surveyed CEOs cite that a strong tech CxO and CFO collaboration is critical to their organization's success. However, a disconnect exists: only 39% of surveyed tech CxOs say they collaborate with finance to embed tech metrics into business cases, and just 35% of surveyed CFOs report being engaged early in IT planning to set strategic expectations. Among the high-performing tech CxO respondents, the study found that organizations that connect technology investments to measurable business outcomes report 12% higher revenue growth.

"Tech leaders today are grappling with multiple business demands, made even more complicated by the rise of generative AI. They must navigate the challenges of modernizing their IT infrastructure and scaling generative AI to support the business' core competitive advantage, " said Mohamad Ali, Senior Vice President, IBM Consulting. "In this evolving AI landscape, the relationship between tech CxOs and their finance counterparts has never been more important, aligning technology spend with business outcomes to drive real value from AI investments."

Responsible AI is top of mind for tech CxOs, but there is a gap between intention and actions

  • For the majority (80%) of CEOs surveyed, transparency in their organization's use of next-generation technologies, such as generative AI, is critical for fostering trust.
  • Yet, most tech CxOs acknowledge their organizations are falling short on delivering core responsible AI practices at scale:
    • Only half (50%) of respondents say they are delivering on key responsible AI capabilities for explainability, and even fewer say they are delivering capabilities for privacy (46%), transparency (45%) and fairness (37%).
  • 41% of tech CxOs surveyed reported an increase in their concerns about regulation and compliance as a barrier to generative AI over the last six months.
  •  However, most (70%) tech CxO respondents see regulatory change as an opportunity versus only 50% of CEOs.

Tech CxOs are driving their organizations to rethink their talent strategy to meet the needs of the generative AI era

  • 63% of tech CxOs surveyed agree that their competitiveness will hinge on their ability to attract, develop and retain top talent.
  • However, 58% of tech CxOs surveyed say they are having difficulty filling key technology roles, and only 27% of respondents identify talent as a top priority.
    • Over the next 3 years, tech executives anticipate a surge in skill scarcities over key areas, including cloud (+36%), AI (+29%), security (+25%) and privacy (+39%).
    • 40% of respondents report an increase in their concern over the past six months.
    • More than half (54%) of tech CxOs surveyed blame financial pressures for hindering their ability to invest in technology talent.
  • Many tech CxOs surveyed (69%) say they are turning to business partners as a source for specialized skills

To view the full study, including recommendations for technology leaders, visit: https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/cxo

*Study Methodology
The IBM Institute for Business Value (IBV), in cooperation with Oxford Economics, surveyed 2,500 C-suite technology leaders, including Chief Technology Officers (CTOs), Chief Information Officers (CIOs), and Chief Data Officers (CDOs) from 34 countries and 26 industries during Q1 2024. The IBM IBV data analytics team performed a series of in-depth analyses and data transformations to indentify a group of high-performing technology organizations corresponding to clear outperformance on a variety of financial and operational measures. The study also includes data from the 2024 CEO Study and upcoming 2024 CFO Study.

The IBM Institute for Business Value, IBM's thought leadership think tank, combines global research and performance data with expertise from industry thinkers and leading academics to deliver insights that make business leaders smarter. For more world-class thought leadership, visit: www.ibm.com/ibv.

About IBM
IBM is a leading provider of global hybrid cloud and AI, and consulting expertise. We help clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. Thousands of government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM's hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently and securely. IBM's breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and consulting deliver open and flexible options to our clients. All of this is backed by IBM's long-standing commitment to trust, transparency, responsibility, inclusivity and service.  Visit www.ibm.com for more information.

Media Contact
Marisa Conway
IBM Communications
conwaym@us.ibm.com

 

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SOURCE IBM

FAQ

How has C-suite confidence in IT services changed since 2013 according to the IBM study?

According to the IBM study, C-suite confidence in IT's ability to deliver basic services has declined significantly, dropping from 69% in 2013 to 47% in 2024.

What percentage of tech CxOs report increased concerns about their technology infrastructure due to generative AI?

The study reveals that 43% of tech CxOs report increased concerns about their technology infrastructure over the past six months due to generative AI demands.

How much of their budget do tech CxOs expect to allocate to hybrid cloud and AI combined over the next two years?

According to the IBM study, tech CxOs expect to allocate 50% of their budget to hybrid cloud and AI combined over the next two years.

What is the revenue growth difference for organizations that connect technology investments to measurable business outcomes?

The IBM study found that organizations connecting technology investments to measurable business outcomes report 12% higher revenue growth.

What percentage of tech CxOs surveyed are having difficulty filling key technology roles?

The study reveals that 58% of tech CxOs surveyed report difficulty in filling key technology roles.

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