2025 Predictions from McKinsey

McKinsey & Company shared their predictions for 2025 and there were some real gems in there as per usual. They said, "tech officers should be ready to answer some critical questions in 2025." Here are some of those questions.

• What is your approach to applying tech to fundamentally change the cost structure of both the business and the tech function?

Cost structure is an interesting one. All too often IT looks at straight cost and performance to take action. More advanced shops start to align with some deeper costs, but there's a Trust Cost of IT that's getting ignored - the sustainability impact. If you're a Net Zero company (there's 170,000 of you) then you're buying carbon credits to offset activities. Those IT activities are a big driver of that. There's litigation impacts to consider as data centers continue to run cities out of water and power. Social impacts. Carbon tax impacts. The list goes on and on. There's a massive opportunity to change the cost structure of IT and the business just by paying attention to the environmental impact of IT. It's hard and complicated but that's why we built Terra Trust AI.

• Is your tech estate really ready to deliver the high ambitions of AI, including data, modern tech platforms, operating model, and talent?

There's a lot of talk and promise about AI, but it has a massive impact on the environment. The Washington Post recently reported on AI consuming a bottle of water per email it writes. Yikes! To make room for all of that excess electricity and water usage you need to optimize your current environment. That’s what our customers have been doing. We call it the “AI Carve Out” play. Optimize what you have. Reduce the current impact. Make both impact room as well as budget room to accelerate AI plans.

• What steps have you taken to protect the business from top geopolitical risks?

Remember SOC 2? Remember GDPR? Guess what’s rolling through the world just like those but with stronger penalties? CSRD and CS3D. 80 different countries and 24 US states now have laws mimicking the landmark EU laws. Sustainability is now part of the IFRS (international financial reporting standards). And while elections have caused some to question what will happen the truth is the laws are here. The pressure from the supply chain is here. The pressure from customers is here. You can prepare and set yourself up for success now or become one of the reactionary companies later. Your choice but I can tell you who did better when SOC 2 and GDPR rolled through. And yes, GDPR went into effect during Trump’s first administration as a proof point on how geopolitics plays when something like this starts to impact you (hint: it won’t slow it down).

• What initiatives will you put in place to understand how emerging tech, such as quantum technologies, can generate value for the business?

GreenOps is an emerging space. It directly impacts how IT operates to drive value for the business. It will help you run lean. Help you make room for advancements like AI. Help you avoid major risks and penalties to the business. With 46% of a company’s footprint being locked in IT, there’s an outsized opportunity for the leaders of IT to become the champions of tomorrow.

At Terra Trust, we understand that sustainability is a complex and foreign subject for most in IT. That’s why we created Terra Trust AI – to align sustainability into the every day tasks and priorities of IT. It’s doesn’t have to be a project. Let our platform give you the intelligence and coaching and solutions when and where and how you need it. Let 2025 be the year that you become the new champion in your company. We’re here when you need us.