The wild ride of 2023, a year ripe with major technology and business shifts, is in its final months. Companies now have their sights set on 2024, setting expansion goals and preparing to pursue them.
While CEOs have always expected IT leaders to accelerate growth with technology, next year will emphasize the CIO's ability to augment their company’s capabilities, especially as economic and geopolitical issues pressure executives.
"There's a lot of pressure," said Matt Guarini, VP, senior research director at Forrester. "I think that folks feel like a lot of the CEOs are turning on them and saying 'now is your time to deliver.'"
Businesses have high expectations for AI, but it's still hard to attract talent and manage geopolitical and regulatory issues.
Here are five Forrester predictions CIOs and other technology leaders can use to guide their decisions next year.
1. Most technology executives will fall short on growth plans
Even the most direct mandates to use tech for growth will fail if a company is not clear on what growth actually looks like. Forrester expects just 1 in 10 tech leaders will get growth right despite clear calls to action from CEOs.
There's still a disconnect between systems and people that can derail businesses trying to grow in 2024, according to the firm.
"We still see too much divergence between tech strategy and business strategy," Guarini said.
Too often, tech units build new capabilities based on their own views, rather than responding to business needs, he said. This will lead to delayed project delivery times and budget overruns.
2. The generative AI boost is coming
Generative AI evolved from an abstract notion to a concrete capability across several IT functions this year. Businesses have gradually started to use the technology to their advantage,accelerating software delivery and aiding IT help desk support.
In 2024, workers will continue to organically infuse the tech into their daily work, and organizations will improve their ability to roll out new features, drawn in by the potential productivity gains, Forrester said.
Thanks to enterprise AI initiatives, companies will be able to boost productivity and creative problem-solving by 50%, according to the analyst firm.
"[Companies are] gonna have to put guidelines around it, no doubt," said Guarini. As adoption rolls forward, companies will benefit from employees' ability to automate repetitive tasks and identify new ways to work.
3. Leaders look to shadow HR
The big layoff cycles hitting the tech sector earlier this year did little to solve the long-standing challenge of attracting tech skills. With the development of generative AI, companies will need even more workers in specialized categories such as data engineers.
The rapid pace at which tech skills turn over will lead businesses to rely more closely on "shadow HR" next year, as external partners provide support to backfill critical skills. The firm expects 20% of leaders to rely on these partners for their talent needs.
"The best organizations will stay close to their HR business partners," said Guarini. However, some businesses will need to work with partners to get what they need in terms of tech capabilities.
4. CIOs tap partners for AI success
Large professional services firms, from PwC to Accenture and EY, have aggressively invested to deliver generative AI capabilities for clients in the past year. Development efforts have included the creation of in-house models, training programs and the internal roll-out of tools to their employees.
The growth of this ecosystem means most tech execs will seek partners to close the AI gap, as half of businesses will fail to master it internally.
Forrester expects more businesses to turn to services firms in their push to close the AI skills gap and add new features to products and services. But overreliance on partners can mean internal skill building is neglected.
"We are seeing that, in some cases, companies are losing a lot of their ability to do things, because they become so reliant on going to the service partners to get capabilities and jobs done," said Guarini. "We can see that people are going to use it to close the gap. But, if you don't build these capabilities internally, you're going to struggle in the long run."
5. Geopolitical pressures mount
The effects of geopolitical unrest, ongoing shifts in regulation and other challenges will push two-thirds of businesses to reassess their approach to tech operations, according to the analyst firm.
While in recent years organizations have pushed their companies to a global operating model, the rising regulation will impact technology and operating decisions, according to Guarini.
Executives will need to mull questions as they arise, Guarini said. "If I'm going to be using these large language models, can I use them in China? Probably not," Guarini said. "How do I think about how GDPR is going to affect how I update it?"
