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      • Generative AI is unlike any technology that has come before. It’s swiftly disrupting business and society, forcing leaders to rethink their assumptions, plans, and strategies in real time.
      • To help CEOs stay on top of the fast-shifting changes, the IBM Institute for Business Value (IBM IBV) is releasing a series of targeted, research-backed guides to generative AI on topics from data security to tech investment strategy to customer experience.
      • This is part 17: IT Automation.

    Generative AI is unlike any technology that has come before. It’s swiftly disrupting business and society, forcing leaders to rethink their assumptions, plans, and strategies in real time.

    To help CEOs stay on top of the fast-shifting changes, the IBM Institute for Business Value (IBM IBV) is releasing a series of targeted, research-backed guides to generative AI on topics from data security to tech investment strategy to customer experience.

    This is part 17: IT Automation.

    Generative AI is unlike any technology that has come before. It’s swiftly disrupting business and society, forcing leaders to rethink their assumptions, plans, and strategies in real time.

    To help CEOs stay on top of the fast-shifting changes, the IBM Institute for Business Value (IBM IBV) is releasing a series of targeted, research-backed guides to generative AI on topics from data security to tech investment strategy to customer experience.

    This is part 17: IT Automation.

    Outdated technology is dragging you down

    Technical debt is back in the spotlight. It erodes profitability, drains resources, inhibits growth, and stifles creativity. It’s an albatross CEOs carry, impeding their push to accelerate transformation with generative AI.

    As a result, many CEOs find themselves mortgaging the future to survive in the present. In fact, the 2024 IBM IBV CEO study found that two-thirds of CEOs say they’re meeting short-term targets by reallocating resources from longer-term initiatives.

    There is a better way. CEOs can have their cake and eat it too. But how?

    It starts by changing how we think about IT spending. Rather than viewing IT as a cost center—an expense businesses must eat to keep the lights on—we need to rethink how technology can better boost ROI.

    It’s a big mindset shift. Today, a typical organization spends just 23% of its tech budget to drive revenue, according to recent IBM IBV research. But generative AI changes the equation. Three-fourths of IT executives say the value created from gen AI will be reallocated to new investments that drive business innovation and growth.

    This is why CEOs shouldn’t view tech upgrades as a series of isolated IT costs. They need to connect tech capabilities to business strategies that will drive improved performance. And then invest accordingly. By deliberately engineering their IT estate with business priorities in mind—applying what we call hybrid-by-design principles to IT programs—IBM analysis suggests that organizations can increase ROI three-fold over five years.

    The IBM Institute for Business Value has identified three things every leader needs to know:
    1. IT should be the launchpad for business innovation.
    2. Anyone can become a gen AI genius.
    3. Generative AI makes IT clairvoyant.
    And three things every leader needs to do right now:
    1. Break away from the “break-fix” model.
    2. Make tech less techy.
    3. Conquer complexity with intelligent visibility.
    Additional content

    Meet the authors

    Anthony Marshall

    Connect with author:


    , Senior Research Director, Thought Leadership, IBM Institute for Business Value


    Cindy Anderson

    Connect with author:


    , Global Executive for Engagement and Eminence, IBM Institute for Business Value


    Christian Bieck

    Connect with author:


    , Europe Leader & Global Research Leader, Insurance, IBM Institute for Business Value


    Karen Butner

    Connect with author:


    , Global Research Leader, AI and Automation and Supply Chain Operations, IBM Institute for Business Value

    Download report translations


      Originally published 10 July 2024


      default alternate image text
      This chapter is available in the latest edition of the IBM Institute for Business Value's book, The CEO's Guide to Generative AI.
      1. Innovation
      + Generative AI
      What you need to know
      IT should be a launchpad for business innovation

      Generative AI streamlines the work IT does every day, from software deployment to network configuration to capacity management. These tasks are essential to keep operations running smoothly—but they rarely boost the bottom line. At least not in any measurable way.

      When IT teams are liberated from the day-to-day drudgery of maintenance and support, they’re freed to envision a future built on new transformative technologies—including, of course, generative AI. Generative AI also fuels their creative fire, sparking ideas for new digital products and revenue streams. And most companies have hit the ground running.

      Today, 62% of IT executives say their organizations are using generative AI for code generation—and that figure will jump to 87% by 2026. 65% of tech leaders expect gen AI solutions to automatically resolve IT issues with little to no human intervention. And 82% of IT executives expect generative AI to improve DevSecOps, the automated workflows that incorporate security practices throughout the development lifecycle, over the next two years.

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      In the same timeframe, more than eight in 10 IT and operational executives that believe automation is essential to fast-track generative AI capabilities plan to focus on automating IT networking operations (89%) and IT service management (83%). And they’re seeing real business improvements as a result. They outperform the competition in workforce agility, profitability and efficiency, innovation, and revenue growth—demonstrating how AI-powered automation can transform IT into a business incubator and foster an entrepreneurial culture.

      By giving everyone access to generative AI tools and expertise, IT democratizes innovation, empowering employees to develop their own ideas to unlock business value—and predict which are most likely to succeed.

      The benefits of adopting generative AI are significant and broad. It not only drives growth but also attracts and retains top talent, who are drawn to organizations that prioritize creativity and autonomy. And if IT leaders funnel this curiosity into a shared, collaborative platform, they can feed a vibrant innovation pipeline that can help the organization meet ambitious growth targets quarter after quarter.

      What you need to do

      Break away from the “break-fix” model

      CEOs need to focus on modernizing all aspects of the IT estate to enable greater automation. Empower teams to move beyond fixing what’s broken to focus on more strategic work. Ensure that IT systems are aligned with strategic business goals and specific operational and financial metrics.

      • Make hard work easier. Identify the systems, applications, and data flows that must be integrated to streamline and automate work. Give IT teams access to a generative AI platform and tools they can use to quickly create the code and APIs needed to connect disparate systems. Encourage teams to identify new ways to automate and augment routine tasks.
      • Get more out of every IT dollar. Align tech spend with business objectives—and fast track initiatives that accelerate performance improvement. Go beyond finding efficiencies to invest in tech that will create new revenue streams and promote rapid growth.
      • Measure what matters. Establish a feedback loop to continually monitor and improve gen AI model performance. Look past traditional IT metrics, such as uptime and downtime, to gauge success. Instead, focus on business-centric metrics, such as user satisfaction, revenue growth, and speed-to-market.
      2. Transformation
      + Generative AI
      What you need to know
      Anyone can become a gen AI genius

      Employees don’t need to be IT experts to transform business with technology. But they do need IT experts to provide the tools and platforms that put the power of gen AI at their fingertips.

      If IT provides the right low-code and no-code platforms, anyone can create or modernize web and mobile apps—a process that, until recently, required a team of developers. At the same time, gen AI code assistants let developers quickly translate code from one language to another, reducing the need for some hard-to-find technical skills.

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      While IT must be the catalyst of this transformation, the benefits will extend across the business: 81% of executives say generative AI will fundamentally change how people do their jobs. And IT executives are up for the challenge, with 70% saying their organizations will design AI systems to seamlessly collaborate with humans by 2026.

      To produce the best results, they’ll need to bring employees along for the ride, showing them how to make the most of new gen AI tools. Technology can be intimidating for non-technical teams, but training and reskilling can demystify gen AI and encourage people to try something new. And providing this support is more important than ever. In 2024, global CEOs said 35% of their workforce would require retraining and reskilling over the next three years—up from just 6% in 2021.

      But that’s only half the battle. IT must also modernize the organization’s tech foundation to allow data to flow easily—and safely—between interconnected systems. That’s why, over the next two years, 83% of IT executives say they’ll use gen AI to align comprehensive enterprise architecture to business activities. At the same time, IT must shine a light on shadow IT to manage the potential chaos that could come from democratizing development. Both tasks will require IT leaders to play a more strategic role—earning them a permanent place in board-level conversations.

      For years we’ve been saying that IT needs to work more closely with the business— and the business needs to work more closely with IT. Generative AI could finally make this a reality: 68% of executives say it will bridge the gap between IT and the business. By providing a shared canvas for collaboration, gen AI helps IT develop a deeper understanding of business problems and business teams harness the full power of technical solutions.

      What you need to do

      Make tech less techy

      Embed IT in the boardroom. Make technology central to every business strategy—and challenge leaders to connect performance metrics to the systems, platforms, and tools that enable their success.

      • Assemble multi-disciplinary dream teams. Build squads of people with diverse skills and backgrounds, including data scientists, engineers, domain experts, and business stakeholders, to collaborate on generative AI projects. Organize workshops, hackathons, and other competitions that spur innovative thinking and knowledge sharing.
      • Empower DIY developers. Evaluate and select a low-code or no-code platform that aligns with the enterprise’s technology stack and gen AI platform. Establish guidelines for data management, security, and compliance—then push people to explore what they’re capable of.
      • Challenge cultural norms and let digital natives drive change. Flatten hierarchical decision-making to give younger team members a stronger voice. Launch reverse mentorship programs that pair people just entering the workforce with senior leaders. Give them space to ask why. And why not.
      3. Prediction
      + Generative AI
      What you need to know
      Generative AI makes IT clairvoyant

      AI systems already help IT teams accurately predict and prevent system failures and bottlenecks. But with gen AI, businesses see even farther into the future.

      By deploying generative AI and AIOps in tandem, teams gain intelligence that lets them anticipate and prepare for scenarios that might otherwise catch them by surprise. For instance, by automatically identifying and mapping relationships across the IT estate—a process known as topology discovery—IT teams quickly understand the dependencies between different systems and components.

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      This process reveals how problems in one area can cascade across the business—and lets IT limit the domino effect. It also makes it easier to optimize network performance, strengthen security, and keep teams across the organization in lockstep. Today, roughly two-thirds of IT and operational executives that believe automation is essential to fast-track generative AI capabilities are already automating topology discovery (66%), incident mitigation (69%), and performance monitoring (63%).

      And that’s just the first step. Armed with this foresight, IT leaders can use generative AI to supercharge simulations. Gen AI-enabled digital twins can model multiple dimensions simultaneously, letting teams test response strategies more effectively. Rather than wondering how well their plans will work, they can see them in action.

      Generative AI also helps IT more confidently estimate the business value of different IT investments. Today, 57% of IT executives are already using generative AI to predict outcomes, efficiency gains, and ROI in IT and network automation initiatives—and this figure will grow to 75% by 2026. This level of visibility can help manage the cost side of the equation, as well: 76% of IT executives say they will use gen AI to enhance FinOps practices for more precise control of cloud costs.

      What you need to do

      Conquer complexity with intelligent visibility

      Use gen AI-enabled digital twins to model the effects of specific disruptions across the enterprise and the ecosystem. Improve ROI with more accurate estimates of how much tech investments will cost—and how much value they will deliver.

      • Hunt for treasure across your IT estate. Provide operations visibility into applications and infrastructure by using generative AI to uncover the relationships that are key to building resilience and driving growth. Discover hidden riches by modelling different improvements—and investing in the solutions that promise the best returns.
      • Head off hazards at the pass. Get out in front of risks by identifying the potential impact of different scenarios in complex systems. Use gen AI to simulate potential outcomes and validate crisis response plans, then forge confidently into unexplored frontiers.
      • Right-size technology spend—then right-size your team. Broaden FinOps capabilities to provide visibility into costs and spending across all AI, hybrid cloud, and application modernization investments. Optimize IT operations to avoid the financial and environmental costs of overprovisioning. Realign your tech team to shed expensive talent that you no longer need.

      The statistics informing the insights in this report are sourced from four proprietary surveys conducted by the IBM Institute for Business Value in collaboration with Oxford Economics. The first surveyed 200 US-based executives in September 2023 about generative AI and supply chain and operations. The second surveyed 400 US-based executives in October 2023 regarding their perspectives on the impact of generative AI on various business processes. The third surveyed 5,000 global executives across 20 business and technology roles from December 2023 to March 2024, examining generative AI use cases, readiness, and impact by enterprise-wide processes and workflows. The fourth surveyed 5,000 global CxOs about how their organization is operationalizing sustainability from August to November 2023.


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      Additional content

      Meet the authors

      Anthony Marshall

      Connect with author:


      , Senior Research Director, Thought Leadership, IBM Institute for Business Value


      Cindy Anderson

      Connect with author:


      , Global Executive for Engagement and Eminence, IBM Institute for Business Value


      Christian Bieck

      Connect with author:


      , Europe Leader & Global Research Leader, Insurance, IBM Institute for Business Value


      Karen Butner

      Connect with author:


      , Global Research Leader, AI and Automation and Supply Chain Operations, IBM Institute for Business Value

      Download report translations


        Originally published 10 July 2024


        default alternate image text
        This chapter is available in the latest edition of the IBM Institute for Business Value's book, The CEO's Guide to Generative AI.
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