PwC Strategy& is tracking the impact of COVID-19 pandemic on the technology agenda of companies through the COVID-19 CIO Pulse Survey. In our first touchpoint released in the week of May 4th, more than 150 CIOs, from more than 10 countries in Europe weighed in.
Technology leaders across industries responded that they are under pressure to cut costs by as much as 30-40%, while also having to rapidly scale up technology enablers for remote working, cybersecurity and digital business models for the long run.
41% of CIOs surveyed have IT cost reduction on their agenda, with targets to cut cost by up to 30-40%. Furthermore, 24% of respondents have deferring or cancelling IT investments as a priority in 2020, compared to 37% for CFOs surveyed by PwC. This highlights the challenges that CIOs will face in the coming months to ’defend’ their investments and to cut costs without stopping or deferring critical capability builds. CIOs need to have a plan to execute projects more efficiently and find other ways to reduce spending.
“Next to creating intelligent workspaces and accelerating e-commerce, it will be essential to digitise the primary processes, like rethinking the donor journey of giving blood or plasma, further digitising the pharma factory and the laboratory, increasing collaboration on research work.”
The pandemic has accelerated the pace of digital transformation and technology is playing a pivotal role in reshaping business. Our survey data shows that investing in digital customer experience requirements and new technology enabled business models remain top priorities for CIOs in 2020 as well as 2021. At the same time IT infrastructure investments are needed in the area of cybersecurity and digital workplace tools. Balancing investments in internal IT infrastructure and external, customer focussed, digital capabilities, while optimising their IT spending is a major challenge facing CIOs today. Technology leaders must reimagine their roles to be front and center of the organisation to drive the digital agenda forward. This is the perfect time for CIOs to act boldly in order to help their organisations emerge stronger from the crisis.
“A few years ago we defined the IT strategy to have everything internet facing. So where people sit doesn’t really matter. The challenge in getting people back into the office is that social distancing limits office capacity to about 30%. Our IT tools allow people to sit at any place in any building.”
Despite the challenges brought by COVID-19, the good news is that IT organisations demonstrated remarkable flexibility in the face of this crisis. In our survey, a majority of respondents (84%) rated the overall IT performance in response to COVID-19 as good or very good. Three quarters of the organisations took less than three days to effectively start working from home when the lockdowns started. These statistics show that the investments in IT infrastructure and efforts to migrate to the cloud resulted in an effective response to the immediate business continuity needs from COVID-19.
In the COVID-19 CIO Survey, we examined the sentiments among technology leaders during the COVID-19 crisis. 35 percent of the participating companies have a turnover of more than 5 billion euros. More than 150 CIOs from across countries completed the survey during the week of May 4th. The second PwC COVID-19 Survey is planned for the end of June 2020.