OUT NOW im #Confare Blog with Peter Sondergaard: The New Economic Order: What Role Does Artificial Intelligence Play in it?
For many years, Peter Sondergaard was Executive Vice President Research & Advisory of Gartner. After leaving Gartner in 2018, he began his journey in supporting global decision-makers as an analyst and consultant in successfully mastering the challenges of digital transformation.
In a 1:1 converstaion between Michael Ghezzo and Peter Sondergaard, a through discussion about the so-called “new economin order” took place. In addition to that, topics such as how the current economic situation is affecting certain industries were addressed. A series of blogs will be published on that exclusively on #ConfareBlogs. Stay up to date on all Confare Blogs with Peter Sondergaard and many more IT experts by subscribing to ConText Confare lights IT up. Sign up here for free.
You can meet Peter Sondergaard in person at the Confare #CIOSUMMIT in Vienna. We are thrilled to welcome him to the Confare stage. He will be there among several other CIOs from all over the DACH-region in one of the top forums that take place in Austria in the IT sector. You can sign up for the event here.
What impact do you expect inflation and fears of impending recession will have on the IT? What impacts should CIOs be aware of?
I think first and foremost, it cannot hurt to dive into your hard drive and find the document that you or your organization created in 2008, regarding cost optimization of IT. This is because if somebody has it, the base principles have not changed; although there may be new aspects. Now, that being said, I think it’s very likely that technology investments are far more important in both addressing cost optimization and also for helping the business grow. Therefore, I think what we will see is that leaders of organizations will probably preserve IT budgets longer than they would have 50 years ago.
Furthermore, strategy has been one thing and the operations under which cost optimization will reside has been another thing. So, those have been almost existing in two different worlds. Nowadays, because of the need to be agile and because of the external threats that exist, we need to integrate the strategy and the operational aspects. All in all, I think CIOs need to recognize that, in an agile world, cost optimization is an element of your strategy, not a separate activity that just pops up on an occasional basis.
Other than the economic risks, what other risks should CIOs be aware of?
This depends on the industry. For example, supply chain challenge today has changed compared to what it was two years ago. Supply chain is more about how you fit into the new world economic order, including near shoring and a better understanding of your second and third level suppliers. Therefore, this aspect of supply chain visibility, and therefore the involvement of CIOs and the function of the IT in it is very important. And I think we need to recognize that it won’t change that fast.
Secondly, we have sustainability. Sustainability and digitalization fit together like a ying and yang, in many ways going forward. This needs to be part of what CIOs are focused on. We have a changing aspect of energy prices that are not just a question of what today’s rate for gas prices are, which two months ago was the highest ever recorded. So, there needs to be an understanding of how you deal with variability in energy prices, which I think we will be seeing for a very long time is important.
Last but not least would be the changing workplace environment. I think many companies are struggling with the combination workplace environment and which technology actually supports it. The CIOs did an amazing job a couple of years ago, putting together a platform that could sustain the kind of work that we had during the pandemic. This however unleashed the Pandora’s box of required flexibility from workers’ side, which will be persistent for a long.
What role would the CIO play in this new economic order?
I think it would be wrong not to say the CIO isn’t critical. I think the new world economic order that will dominate the new world is data and the ability to analyze data. Because the better you do that, the more agile and resilient your business is. So, I think this new world economic order will be dominated by data and analytics or artificial intelligence, and the extension of it into machine learning. And for an organization to survive, you need to make this a part of your culture and a part of how your organization operates. An important aspect is that this needs to be a part of the leadership capabilities and skills because this translates to the way we remain flexible, agile and resilient.