The COVID-19 pandemic triggered the greatest business technology spending rush in history, with organisations dropping as much as US$15 billion each week to support a shift to remote work. But technology leaders say they will need to reign much of that spend back in over the next year and cybersecurity remains a problem
That’s some of the key takeaways from KPMG and Harvey Nash’s annual CIO survey, now in its 22nd year and regarded as one of the most comprehensive polls of technology leaders. In total 4,219 technology leaders representing a quarter of a trillion dollars were polled this year, with surveys split before and after the pandemic.
Respondents reported a median additional spend of 5 per cent of IT budgets to deal with COVI-19, meaning CIOs were spending billions of dollars collectively each week to support remote work and beefing up security.
CIOs say they will look to balance budgets in coming years and headcount will reduce. But overall technology spend will still grow.
“Pre-Covid, 51 per cent of respondents expected budget increases and 55 per cent were planning on growing headcount,” the report authors write. “Now, budget increases are expected for 43 per cent and headcount increases for 45 per cent.
“On balance, this still represents a net growth, and remains significantly higher than in 2009 after the financial crisis. This suggests that, from a technology perspective at least, the nature of this crisis is very different from previous ones.”
According to the report, only 41 per cent of organisations in Australasia are expecting a budget increase in the next year even though 51 per cent expect over half their workforce to be working remotely.
Even with the increased spend cybersecurity persists as a common threat, says Harvey Nash Australia managing director, Bruce Goldsmith.
“It may seem obvious that the threat to an organisation’s cyber security would increase with so many employees working remotely, but for 4 in 10 that threat has become very real.
“This is exacerbated by the fact that the same number of organisations are also suffering from a shortage of skills in cyber. Hopefully with the increase in investment in cyber and privacy these organisations can protect themselves going forward, particularly as many employees won’t be going back to the office full-time.”
Globally the crisis will propel a “digital divide” because while most CIOs scrambled to keep the lights on, digital leaders – organisations that already effectively use cloud computing, SaaS and automation – could rely on their established infrastructure and kept investing, according to the report.
The authors also note while COVID-19 has had a dramatic impact, the top priorities for boards and technology leaders did not change.
“While some organisations will have required a radical change in direction, for most it has served to to accelerate what was already in place.”
One respondent went so far as to declare, “More innovation happened in the last six months than in the last 10 years.”
In light of COVID-19 security and privacy have become paramount, reported as the most important technology investment by CIOs. Next is customer experience and engagement technology, followed by infrastructure and cloud.
The top emerging technology investments are SaaS platforms, distributed cloud and AI and Machine Learning.
Security has become an even bigger challenge through COVID with attack surfaces ballooning as workers stayed home. Three quarters of respondents said attack surfaces and the importance of cybersecurity increased as a result of COVID-19.
“Judging by the big jump in spear phishing and malware attacks, it appears that the growth in risk has come mainly through insider threats against newly remote working employees,” the report states.
“This implies that the focus need not be on technically securing the perimeter but instead on educating people inside the organisation.”