CIOs geared up for AI but their organisations aren’t

• Lenovo’s third annual global CIO report reveals AI as IT’s most urgent priority, matched only by cybersecurity.
• CIOs concede that AI exploration and adoption is pulling resources and attention away from other key IT areas including cloud adoption/digital transformation, sustainability and employee compensation.

Businesses are still unready to make use of artificial intelligence despite AI being the top priority among tech leaders globally.

According to a third annual global CIO report by Lenovo Group – Inside the Tornado: How AI is Reshaping Corporate IT Today, revealed that while CIOs need to adopt and scale AI urgently, their ambitions are threatened by speed, security, and other organisational functions lagging in AI readiness.

Majority saw aspects like computing infrastructure and corporate policies on ethical use as not yet “AI-ready.”

In a stark contrast to previous years, CIOs are tabling non-traditional responsibilities to sharpen their focus on core IT functions. Slightly more than half (51 per cent) of CIOs feel AI/ML is an urgent priority to address, matched only by cybersecurity.

Research firm IDC forecasts that AI-centric spending to exceed $300 billion globally by 2026, underscoring the urgency for AI readiness.

“With AI poised to permeate every facet of business and life, CIOs must prepare for an ‘AI Everywhere’ future,” says Jyoti Lalchandani, IDC’s group vice president and regional managing director for the Middle East, Turkey, and Africa.

A tornado of innovation

John-David Lovelock, Distinguished VP Analyst at Gartner, said that technology providers are required to be a step ahead of this cycle and are already in the execution phase and are bringing GenAI capabilities to existing products and services, as well as to use cases being identified by their enterprise clients. 

 “We are seeing a cycle of story, plan and execution when it comes to GenAI. In 2023, enterprises were telling the story of GenAI and in 2024 we are seeing most of them planning for eventual execution in 2025.”

The Lenovo report revealed that 84 per cent of CIOs are being evaluated on business outcome metrics more than ever before.

“Today’s CIOs are working in a tornado of innovation. After years of IT expanding into non-traditional responsibilities, we’re now seeing how AI is forcing CIOs back to their core mandate,” said Ken Wong, President of Lenovo’s Solutions and Services Group.

“This is driven by the clear promise of AI adoption combined with the pressure that IT leaders face to prove the value of these investments and deliver measurable business outcomes.”

The report revealed that 80 per cent feel that breakthroughs and developments in AI will have a significant impact on their business. At the same time, CIOs see speed to adoption and security as the most significant barriers to scale AI.

“Large swathes of their organisations are not AI-ready, which is directly affecting IT’s ability to scale AI quickly. In particular, they called out: new product lines (78 per cent), corporate policy / ethical use (76 per cent), supply chain (74 per cent), IT’s technical skills (51 per cent).”

Focus on return on investment

What has remained consistent with previous years is IT’s ongoing challenge to measure impact. Sixty-one per cent of CIOs said they find it very or extremely challenging to demonstrate return on investment (RoI) with tech investments while 96 per cent of CIOs anticipate increased investment over the next 12 months, 42 per cent of respondents admit they do not expect to see positive ROI from AI investments for at least two to three years.

While 96 per cent of CIOs said they expect increased AI investments over the coming year, only 20 per cent expect overall IT budgets to grow by more than 10 per cent. CIOs concede that AI exploration and adoption is pulling resources and attention away from other key IT areas including cloud adoption/digital transformation (48 per cent), sustainability (38 per cent), and employee compensation (38 per cent).

“There’s a clear opportunity for us to help businesses make sense of AI, accelerate its scale, and advise on how the impact of these investments can be effectively measured,” Wong said.

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