This picture emerges from PwC’s annual EMEA CIO Survey, based on responses from 705 CIOs, including CIOs from the Netherlands.
The Dutch results of PwC’s EMEA CIO Survey show how rapidly the CIO’s mandate is evolving. Chief Information Officers are no longer solely responsible for ensuring that IT systems are reliable and effective. Increasingly, they are taking on a role that is directly linked to achieving an organisation’s business objectives. This shift also reflects organisations’ growing dependence on technology and expectations around the impact of AI.
Almost half (47 percent) of Dutch respondents expect enterprise-wide transformation to become the CIO’s primary responsibility within the next 12 to 18 months. This is in line with the trend seen across other EMEA countries. As a result, the CIO is becoming more of a business leader: alongside their role in technology and their technological expertise, the emphasis is increasingly shifting towards driving transformation.
'The profile of the CIO is changing. Technical expertise will of course remain important, but CIOs also need to be able to translate that expertise to the boardroom as part of their transformation role. The key is bringing those two together: understanding what technology can enable and translating that into value for the business.'
PwC expert Ragnar van der ValkAI is everywhere, but this is not yet reflected in returns on investment, as PwC’s AI Performance Study has previously shown. That study found that only a small group of companies are able to translate their use of AI into demonstrable returns. One reason is that most organisations do not yet have solid AI foundations in place to build on.
Dutch CIOs appear to be well aware of this challenge. Building the core foundations for AI, including data, platforms, architecture and security, ranks among the top three investment priorities for sixty percent of Dutch respondents. Scaling AI and strengthening AI governance also rank highly on their investment agendas.
'The big challenge for CIOs is that everyone wants to move ahead with AI, while CIOs, on behalf of the wider organisation, are still working to get the foundations right. At the same time, it has become clear that scaling too quickly carries risks if those foundations are not firmly in place. Think of vulnerable systems and cybersecurity risks. Most CEOs can therefore be convinced of the risks of moving too fast, but at the same time, they don’t want to fall behind.'
Ragnar van der ValkScaling AI agents that can perform tasks autonomously (with a human in the loop), is crucial to creating value from AI. CIO Survey respondents identify the quality and availability of data as one of the biggest barriers to scaling AI Agents.
Other barriers cited by CIOs include a lack of skills within their organisations, integration with existing systems, the operating model, change management, the reliability of AI technology and governance. AI deployment is still too often seen as a way to improve existing processes and productivity, rather than as an opportunity to reinvent the business model.
'When AI is embedded into processes and decision-making, or fundamentally changes them, business, risk, security, finance, HR and other functions need to evolve as well. Ultimately, it is the organisation as a whole that determines whether AI truly becomes part of day-to-day operations. That means moving from adding AI to the organisation to designing the organisation around AI. In that shift, the CIO becomes the conductor, bringing everything together and demonstrating the value of AI.'
Ragnar van der ValkWhile many CIOs are seeing the costs of AI and model usage increase, the value is not yet visible, particularly in relation to the costs incurred. The CIO Survey shows that ‘AI economics’ is still in its infancy. None of the Dutch respondents included in the survey manage AI based on both cost and value. Only seven percent forecast, budget and optimise AI usage through ‘AI FinOps’. The remaining respondents only see the costs of using AI after the fact. It is like navigating through fog: organisations are moving forward, but whether they are heading in the right direction remains to be seen.
'In many organisations, the CIO still does not have a direct seat at the boardroom table, even though reinvention is virtually impossible without technology. This can lead to a strong focus on costs rather than on the value AI delivers to the organisation. What’s more, many organisations are still in the pilot phase. At that stage, the focus is often not yet on value, but first on proving that something is possible and that it works.'
Ragnar van der Valk
Partner Technology, PwC Netherlands
Ragnar leads the Technology practice at PwC Netherlands. He specialises in digital transformations. With a background in organisational change and strategic management, combined with extensive experience in technical (IT) environments, he bridges the gap between strategy and sustainable, intelligent solutions.