By: Natalya Makarochkina – Senior Vice President, Secure Power Division, International Operations, Schneider Electric
Today’s CIO faces a formidable array of challenges, that are not unlike the uncertainties that were faced in 2008 amid the financial crisis. The present-day scenario is further complicated by the influence of higher interest rates and geopolitical challenges, impacting not just the political realm but also global trade. As some experts predict a decade of uncertainty ahead, CIOs find themselves at the forefront of navigating these complex waters.
However, security, resilience, and sustainability must remain at the forefront of every CIO’s strategy as they digitally transform for the future.
With a sharp focus on the CIO to drive progress, the challenge of determining which efforts to prioritize becomes crucial. Despite the apparent enormity of the task, clear and innovative solutions exist, empowering CIOs to tackle it by leveraging digital tools and services as the key to success.
Sustainability
Taking the long timeframe, what is clear is that sustainability must be the top priority. The latest publication by the Intergovernmental Panel on Climate Change (IPCC) summarizing five years of reports states starkly, “There is a rapidly closing window of opportunity to secure a liveable and sustainable future for all.”
Despite massive increases in capacity to meet demand, data centers and data transmission networks account for only 1.5% of global energy demand. However, this could grow by between 20 and 70% year on year in the short term.
What this means for the CIO is twofold. Firstly, the CIO must be able to ensure that the enterprise digital infrastructure is sustainable throughout, from the frontline sensor through the edge, across public and private cloud, and down to the core.
With initiatives such as the global sustainability consulting service, Schneider Electric is not just sharing its own sustainability journey, but also offering its expertise to support others in their pursuit of sustainability goals.
Research indicates that software will play a crucial role in delivering precise data granularity for comprehending the details of energy consumption—who uses it and for what purposes.
The ongoing advancement of systems like data centre infrastructure management (DCIM) and environmental, social, and governance (ESG) or environmental sustainability management (ESM) tools will bolster emerging procedures. These advancements go beyond conventional spreadsheets, enabling comprehensive insights and streamlined analysis.
Secondly, the CIO must work more closely with every aspect of the business to ensure that every business unit manager or section leader knows not just what is possible, but is familiar with the tools, services, and facilities available to achieve their respective sustainability goals, as part of the whole. While the CIO has their own specific responsibilities, they can empower each business leader to excel in their sustainability efforts.
The CIO can use case studies and best practice examples to inform business leaders in their thinking on how best to use the tools at their disposal to drive sustainability, even as they transform the business. This means that the CIO will increasingly be the gatekeeper for green value, combating the ‘greenwashing’ claims of many vendors and service providers.
Schneider Electric’s sustainability and energy management tools and services can help organizations achieve the transparency required to know where they are, and what they need to do to improve and achieve their emissions targets.
Along with the sustainability drive, energy costs are also a primary concern. The CIO will look to manage costs through efficient deployment and operation, as well as rationalizing the IT estate.
Despite the drive for cloud adoption and migration, it has been observed that legacy systems persist in many cases, leading to technical debt. Therefore, balancing cost and agility is key. Energy management systems that can provide transparency, and also AI-assisted insights for further improvement, will be an important support for CIOs as they look to get an enterprise-wide view.
Our executive vice president for the Secure Power Division, Pankaj Sharma, expressed it well. “Reimagining products that have been standard for some 20 years is helping us better understand where the IT and data center industry stands in contributing to the vision of net-zero operations and the importance of disruptive innovation in achieving such.”
AI-driven supercycle
According to Gartner, the vast majority of enterprises (80%) will have used generative artificial intelligence (GenAI) application programming interfaces (APIs) or models, and/or deployed GenAI-enabled applications in production environments by 2026.
Other use cases predicted for AI include greater use of flexible, reusable systems such as foundation models, that will improve workforce productivity, automate and enhance customer experience, and enable cost-effective creation of new products and services. Gartner predicts that foundation models will underpin nearly two thirds (60%) of natural language processing (NLP) use cases by 2027.
However, these accelerated rates of adoption also mean that enterprises must be ready for the architectural, sustainability, security, and resource demands of AI. There are specific implications for power supply and density, cooling, rack space, and connectivity. Schneider Electric has produced a white paper 110, titled “The AI Disruption: Challenges and Guidance for Data Center Design,” that addresses such issues, to ensure organizations are ready to capitalize on what some analysts are calling the beginning of an AI-driven supercycle of development.
Security focus
In any time of uncertainty, criminals will look to exploit the situation. Ransomware has seen a major rise in incidence, but also refinement. The attacks are getting more tailored, more specific, and more targeted, according to threat assessments from cyber security vendors.
The attacks are often targeted at specific sectors, such as healthcare, education, and mass media/entertainment, where they can inflict maximum damage.
Various analysts and the US federal government, have advised that the CIO must lead the way in adopting the Zero Trust Model (ZTM) of least privileged access to mitigate the impact of any attack, be it ransomware, stolen credentials, or network penetration.
With the ZTM at its core, enterprises can protect users and data, wherever they are, facilitating new work practices and business models without adding risk or expanding the attack surface.
This is of particular importance as infrastructure and equipment, from plant machinery to smart UPSs, are being instrumented and turned into devices that can be vulnerable. These enablements must be treated as part of the digital estate that must be managed for cyber risk, just like a server or network switch. Even as such devices contribute to the rich data for DCIM/ESG/ESM systems, they must be protected as with any data device and always updated with the latest firmware.
Persistent resilience
With these imperatives of sustainability and security addressed strategically, the next order of business for the CIO is to ensure resilience. The continuous series of shocks in recent years have demonstrated the need for all organizations, large and small, to be resilient while remaining agile.
By building resiliency with technology, CIOs will be enabled to think more strategically for the company as a whole. It is well argued that having the right technology can create a ripple-like effect that empowers employees, which in turn promotes satisfaction and a superior experience.
Perseverance combined with resilience, will be the operating theme for the CIO and the IT team, as shocks and opportunities are dealt with over time. Retaining agility will be key, as hybrid architectures, sophisticated systems and myriad permutations create challenges for IT management and orchestration.
The digital transformation multiplier
Many organizations have recognized the imperative of transformation to enhance their future competitiveness. This trend is gaining traction among CIOs, who are now focusing on establishing a single technology vision.
This shift represents a departure from the historical practices of global enterprises in managing acquired companies and multiple lines of business. In the past, each business retained its distinct technology stacks. However, through 2024, CIOs will increasingly undertake the task of consolidating these tech stacks to enhance overall business performance.
As digital transformation matures and looks to make ready for new and emerging technologies, from the enterprise metaverse to Web3, a single technology vision is harder to maintain, but no less required.
Analysts emphasize that when businesses focus on multiple technology initiatives, they risk losing momentum and efficiencies. CIOs must adeptly guide enterprise resources to seamlessly interweave various technology initiatives, implementing them before their impact wanes. The difficult economic conditions place additional pressure on CIOs to make the right technology investments.
Skills and talent at the forefront
The combined effect of these various efforts is to provide a single technology vision for the business, that is efficient, resilient and agile, meeting the needs of sustainability, security, and most importantly, employees.
Attracting, retaining and developing talent is becoming more of a challenge for every industry, but particularly in tech. We have seen how IT professionals will go where technology makes the job easier, there are fulfilling projects to work on, and they can make a difference through applied skills, and not just get ground down in a constant firefight.
In an ever more competitive market for top tech talent, especially in new in-demand areas such as AI/ML, Web3, and automation, having the right technology infrastructures in place that demonstrate future readiness will be key to attracting and retaining the right talent to maintain that trajectory. CIOs then, must also provide learning pathways to allow people to develop and grow, as well as nurture new talent.
We, as vendors, have an important part to play in providing training and education to ensure that partners and customers can quickly attain knowledge and achieve proficiency across the range of electrical, IT infrastructure, and automation solutions. Knowledge forums and resources also play a vital role in allowing experts to share resources to the benefit of all.
Software tactical plays
Even as the CIO is working to implement strategic goals, there are tactical wins to consider. Asset management is an area where quick wins can be had. Similarly, in a large data estate, the visibility to ascertain what is in use and levels of utilization, but also a state of repair or configuration, is hugely valuable.
CIOs are facing challenges in resource management due to constraints in talent and budgets. Intelligent cloud-based, interoperable asset management systems offer time, labour, and cost savings, as well as the ability to enhance resilience and agility through features such as preventative maintenance.
The EcoStruxure Platform has a range of services for inventory and performance management, dovetailing with EcoStruxure IT Expert DCIM, to provide visibility and management capabilities over the entire enterprise estate.
CIOs future outlook
The CIO outlook for the next 12-24 months will be dominated by meeting a diverse set of challenges across sustainability, security, resilience, agility, and adaptability, while under the influences of tightening budgets, a struggle for talent, changing customer and employee expectations, and the relentless march of AI.
Those businesses with a sound, digital core defined by a single technology vision will be able to thrive. The transformative CIO will need to work more closely with every element of the business to inform and partner, as well as inspire. As almost every challenge faced will have a digital, technological element to the solution, the CIO has once again emerged as one of the most valued CxO roles.