Technology leaders have serious concerns about their budgets as COVID-19 lockdowns force IT spending to rise in almost all Australian organisations, according to new research from Rackspace Technology.

And as budgets bite, innovation and transformation projects are being sacrificed, along with some security projects.

For its latest report, Preventing Cloud Sprawl: Uncovering the Hidden Complexities of IT Spend Management, the cloud services provider surveyed more than 1500 c-suite technology leaders around the world, including 150 IT directors in Australia.

78 per cent of all surveyed said they had new budget concerns because of the global pandemic. There’s even more widespread concern (84 per cent) in Australia, according to the report.

Most businesses across Australia (87 per cent) have had to increase their expenditure on technology during lockdown, with the majority (56 per cent) expecting further increases in the next 12 months.

Global results show the money is typically being spent on more remote working tools, software licensing, SaaS tools, hardware updates, data centres and cloud services.

But with huge portions of the workforce working remotely, the organisations spending more aren’t typically focused on on security buffs, according to the report.

It is a particularly concerning finding, according to the report authors. “…security is the last place that businesses should be pulling back. The rollback of website migrations and digital transformation projects also signals a slowdown in innovation-generating technologies in lieu of keeping the lights on.” 

Cloud cutting costs

 The cloud vendor’s report proffers cloud technology as a way to better control costs with SaaS and automation also being considered, according to those surveyed. 61 per cent of IT leaders indicated cloud infrastructure is now their priority when budgeting.

“With many businesses having already increased their IT budgets to meet the challenges of COVID, it’s not surprising that IT leaders are now looking at ways to keep costs under control. There’s a general lack of understanding however, and support is often needed to alleviate some of these pressures,” said Sean Girvin, Managing Director ANZ at Rackspace Technology. 

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