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IDC forecasts that IT spending in the Middle East, Turkey and Africa (META) region will grow 4.3% year-on-year in 2023 to reach $99.9 billion. Growth is anticipated to continue over the next few years to exceed $113.5 billion in 2026. The research firm also expects ICT spending to reach $233.8 billion in 2023 with an increase of 3.9% over 2022 and this growth will likely also continue over the coming years, reaching $259 billion by 2026.
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This growth reflects the organisation’s understanding of the value of IT and ICT investment in driving revenue growth, embedding resilience and building sustainable business foundations, especially against the current backdrop of economic uncertainty, inflation, and the ongoing fear of a global recession.
“Successfully navigating the gathering storms of disruption asks that CIOs focus on strengthening the digital resiliency of their organisations so they are better positioned to not only survive but thrive, in new market environments as conditions continue to change,” says Jyoti Lalchandani, Group Vice President & Regional Managing Director (META) at IDC. “Process automation, re-engineering, and productivity improvements will be key priorities in this regard, plus a sharpened focus on creating new digital business models and revenue streams through the establishment of industry ecosystem partnerships.”
IDC research shows that 95% of organisations worldwide are implementing digital-first strategies to support new digital revenue streams. Companies are increasingly looking to squeeze out a greater share of revenues from digital products, services, channels and platforms and this means that CIOs will need to focus on delivering insights at scale. This requires that they build capabilities in data and enterprise intelligence while investing in solutions that will allow them to facilitate long-term hybrid working models.
“The CIO is under mounting pressure to facilitate hybrid working and to support the organisation’s growing commitment to environmental, social and corporate governance (ESG) goals through digital investments,” adds Lalchandani. “In addition, there is a growing need to focus on improving the customer experience. Organisations need to map all elements of their customer journeys, identify critical customer touchpoints and create optimal experiences across all channels and devices.”
The rise of the digital economy is a leading technology trend in 2023 as digital adoption increases rapidly across the region. Organisations have to adapt their business models to the changing characteristics and demands of their customers. They also have to improve coordination across key functions that impact the overall customer experience across marketing, sales, IT, operations, HR and customer service.
“The customer and ESG – these are the leading issues across the META region,” says Lalchandani. “While it is still in the early stages, we are seeing an increasing number of companies implementing programmes aimed at reducing the energy consumption of their IT infrastructure, extending the lifecycles of their IT equipment and centralising datacentres to reduce their environmental footprint. With the UAE set to host the COP28 climate conference in 2023, the focus on sustainability-related initiatives will likely gain momentum as the year progresses.”
Another wave of disruption that has seen significant traction is the metaverse, although not quite in this region. Only 5% of enterprise-grade organisations in META currently have commercial use for the metaverse, but there is considerable interest among CIOs tapping into this rapidly emerging space over the next 12-24 months. As Lalchandani adds, “We’re seeing an increasing number of organisations looking to establish a brand presence in the metaverse and current use cases include interactive customer experiences, immersive shopping, and interactive learning spaces for training and onboarding. We expect to see more widespread adoption of the metaverse in the enterprise and industrial environments over the coming years.”
Looking ahead, the CIO will also need to find solid footing in the upcoming tech ecosystem shake-up as technology firms increasingly move away from linear channel structures so they can develop more interconnected ecosystems of traditional and non-traditional partners.
“We can expect these ecosystems to kickstart an explosion of co-creation and co-innovation between partners, vendors and customers,” concludes Lalchandani. “These are some of the key discussions that will be had at the upcoming IDC South Africa CIO Summit taking place in Sandton in May. The future is certainly disruptive and dynamic, so for the CIO and the organisation, stability relies on tech investments that will support growth, scale and sustainability.”
