With inflation up and budget cuts happening across all divisions of construction companies, CIOs are tasked with implementing new, innovative technology and demonstrating the positive financial benefits of tech investments. Perhaps the best way to proceed in this case is with a clear vision of the financial impacts of digital transformation.
One new survey suggests 94% of organizations are struggling with developing this vision for digital change—at least in the EMEA (Europe, Middle East, and Africa) region, although I suspect this is a common occurrence around the world as well.
The 2023 Gartner CIO and Technology Executive Survey gathered data from 2,203 CIO respondents in 81 countries and all major industries, representing approximately $15 trillion in revenue/public-sector budgets and $322 billion in IT spending. In EMEA, 780 CIOs participated in the survey from 51 countries and all major industries, representing nearly $5.9 trillion in revenue and $78 billion in IT spending.
In 2023, EMEA CIOs expect their IT budgets to increase 4.4% on average, which is lower than the projected 6.5% global inflation rate, according to Gartner. This means CIOs will have less funding available than last year. Add to this scarce and expensive talent and ongoing supply challenges, and the construction issue is currently in the perfect storm.
The solutions are four-fold, according to the analyst firm.
First, construction companies need to prioritize the right digital initiatives. How many times has Peggy Smedley said not to simply do digital transformation just for the sake of doing digital transformation? Rather, construction companies need to identify the top objectives and goals for their business and then implement technology that follows suit. The survey suggests the top two objectives were to improve operational excellence and improve customer or citizen experience.
Second, businesses should create metrics hierarchy. Simply, this means every single business unit—marketing, sales, financial, tech, and other C-level executives—should have their own metric that contributes to the same business result.
Third, construction companies might consider contributing IT talent to a business-led fusion team. The analyst firm suggests loaning IT staff to fusion teams that combine business experts, business technologists, and IT staff, which will catalyze a team that is focused on achieving digital business outcomes, while also opening the way for reciprocity, such as integrating subject-matter experts from the business into an IT-led fusion team.
Finally, businesses need to reduce the talent gap with unconventional resources—which is also something Smedley has been talking about for quite some time. She has suggested mentorship and guidance, partnerships, bringing more women into the workforce, leveraging technology, sparking curiosity, and more.
What would you add? How can we still implement new, innovative technologies with limited resources—time, money, and talent? Do we need to get crystal clear on our objective? What else do we need to consider?
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