CIOs step up to future business challenges
A CIO Perspective on the dual perspectives for the top 10 risks and opportunities in 2013 and beyond
Five years from the crash, global business is reconciled to “the new reality.” Multinational companies are not waiting for markets to recover. Instead, and particularly in mature markets, they are seeking to optimize their business by cutting costs and increasing efficiency. They are facing risks around pricing pressure, while innovation in products, services and operations bring new opportunities. As their mature markets continue to stagnate, companies are exploring emerging markets for growth.
Against this background, the question is how CIOs can enable their organizations to deal with the strategic challenges ahead. Their role is crucial but, given the pressures faced in dealing with daily operational issues, it is easy to lose sight of the broader picture.
As current research* shows, there are four areas where CIOs can help to minimize risks while exploiting opportunities:
Cost competitiveness – the new reality in companies
With modest growth prospects in mature markets, and aggressive competition in the emerging markets, cost competitiveness addresses the top risks for global companies. Getting to grips with this risk can bring a compelling payoff: EY estimates that cutting costs by just 1% can yield the same bottom-line results as a 10% boost in sales. CIOs can play a strategic role here, driving the deployment of technology to help companies reduce cost and optimize the organization, and ensuring competitive advantage.
Stakeholder confidence – sustainable stakeholder relationships
IT is critical to operational improvements, as well as strategy, to ensure the organization complies with stakeholder expectations around IT and information security. By virtue of their seniority and oversight, CIOs can ensure these issues receive urgent attention in the C-suite and across functional departments. Furthermore, they can also support related strategic opportunities, such as in relation to cleantech, not least as regulatory requirements continue to grow here. However, compliance is not always enough: organizations need to show that they comply with current regulations and have adequate risk policies in place to deal with emerging ones. Therefore, CIOs should ensure their organization is communicating their control measures and information security.
Customer reach – innovation is the biggest opportunity
Companies see innovation as the key to success, whether in terms of new products or services, or within operations. The emergence of new marketing channels, the rise of social media, cloud computing and data insights all offer growth opportunities. At the same time, companies are increasingly aware of the new threats and challenges that this technology brings into the business. Seizing the digital opportunity while anticipating the various implications can allow the CIO to take a central role in the strategic development and growth of the business.
Operational agility – fine-tuning for greater performance
Operational agility is crucial to surviving – and flourishing – in a volatile world economy. Global companies see IT investment as a critical enabler. In order to maintain their agility – and build their execution capability – companies need to stay abreast of IT developments that could help them improve performance and reduce risks.
Read more on the CIO agenda: ey.com/cio
* EY, Business Pulse – Exploring dual perspectives on the top 10 risks and opportunities in 2013 and beyond, 2013
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