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There is an increasing business demand for pragmatic step-by-step digital transformation initiatives that combine innovation and optimisation to help stressed out CIOs who have to juggle cloud migration, agility and tight IT budgets.
This is according to the CIO Pulse: 2023 budgets & priorities study by software and cloud solutions provider SoftwareOne.
The study, which recently surveyed 600 C-suite and IT decision-makers in the UK and USA, examines how the current global economy is impacting IT priorities. It revealed that despite 93% of CIOs expecting IT budgets to increase in 2023, 83% say they are under pressure to make their budgets stretch further than ever before – with a key focus on improved cloud cost management and tackling the reduction of mounting technical debt.
Although SoftwareOne confirmed that there are no Africa-relevant statistics available, Marilyn Moodley, country leader for South Africa and WECA (West, East, Central Africa) at SoftwareOne, believes local businesses face the same challenges as their global counterparts.
“Businesses are dealing with an uncertain economic environment, which makes planning big IT transformations a challenge. Yet organisations need to move to the cloud and modernise legacy applications to remain competitive,” says Moodley. “We’re seeing a real need for a combination of innovation with optimisation. Our clients are looking for pragmatic step-by-step transformation initiatives, rather than wholesale megalithic projects that can be hard to get approved when budgets are under pressure.”
The study found that 72% of CIOs admit they are behind in their digital transformation because of this technical debt, which is of particular concern as 92% of CIOs are expected to deliver digital transformation initiatives that act as revenue generators this year.
Almost 40% said the accumulation of this debt is largely because of rushed cloud migrations during the pandemic, with 31% failing to optimise their workloads before commencing the migration process.
A further 38% revealed that their organisation miscalculated the cloud budget when provisioning, which resulted in significant cloud overspend. Many organisations also still have multiple on-premises IT legacy systems and 51% of CIOs state that the complexity of legacy IT is one of the top three challenges they currently face.
Despite budget pressures, 82% will increase their investment in application modernisation. Security remains a priority, with 92% increasing investment in this space.
Moodley predicts the year ahead will be challenging for businesses worldwide.
“The increased agility that comes with cloud computing will allow companies to better respond to these unexpected market changes. Adopting FinOps practices will help them optimise not just their spend but the processes, accountability and transparency required to get maximum value from their cloud investment. Once legacy IT is migrated and modernised, and cloud is optimised, any savings can be reinvested into innovative projects that help the IT team to achieve more with less.”
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