That is the conclusion of a survey published Monday by McKinsey & Company, culled from 1,469 chief executive officers, chief financial officers, and chief information officers. The survey attempted to gauge how they felt about cloud computing and mobility, analytics, and digital media. About one-quarter of the respondents expect their companies to spend at least three percent of their total cost base on such digital initiatives, and two-thirds see digital business practices increasing their operating income within the next three years. Twelve percent of them thought it would raise operating income by 30 percent or more.
Other highlights:
-There is a big disconnect between how many CEOs think they will invest three percent of their total corporate costs on digital initiatives (40 percent) and how many CIOs think that is true (12 percent.)
That surprising disconnect between how much chief executives think they are investing and how much chief information officers think they are investing may not be a disconnect at all. Rather, it may be a sign that computing resources are now dispersed and accessible by many, as public clouds like Amazon Web Services and Google Drive become more popular, with easier to use interfaces. CIOs, who traditionally look after the corporate servers, may not have as good a handle on what is being used in their companies.
-Data and analytics are expected to generate more value than digital marketing or social media. The three major areas where people expect to see results from analytics are customer insights and targeting, budgeting and forecasting, and operations and supply chain management.
-Half of respondents don’t think their organizations are properly structured to take advantage of new technologies. Forty-five percent see a lack of internal leadership in fostering use of the technologies.
As with most of these surveys, carried out online over a short period, it is as useful to read between the lines as it is to take the numbers as gospel. Cynically, one can think that McKinsey is pleased about the confusion about where to invest; that is the kind of decision that calls for a McKinsey consultant. That said, in this survey McKinsey also makes the valuable point that companies are going to have to start fostering internal talent, since they can’t keep raiding tech companies without raising costs.
Secondly, while the survey treats the three digital topics separately, from a strategic level they may be better seen as a single phenomenon. Data is information going into the company and mobile and cloud is the operational way it is handled; digital media is information headed out. In an era where computing is everywhere, the old distinctions may not work well.