Cybersecurity Tax is hindering investment in future progress

Analysts talk to CIOs in Australian and New Zealand Organizations to discuss 2022.

Seventy-three percent of Australian and New Zealand (A/NZ) CIOs said cybersecurity will be their biggest technology investment in 2022, as greater regulation and threats increase leadership focus on security, according to Gartner, Inc.’s annual global survey of CIOs and technology executives. This is up from 67% in 2021, overtaking data analytics which topped the list last year, and compares to 66% of CIOs globally.

The 2022 Gartner CIO and Technology Executive Survey gathered data from 2,387 CIO and technology executive respondents in 85 countries, including 114 CIOs in ANZ across the public, private and non-profit sectors. Gartner analysts presented the survey findings during Gartner IT Symposium/Xpo APAC, which is taking place virtually this week.

“This continuing need to invest heavily in cybersecurity in A/NZ is creating a cybersecurity “tax”, hindering progress in other areas by redirecting investments that could be used for future innovation – a risk-based approach is needed to make sure organizations are not spending too much,” said Andy Rowsell-Jones, distinguished research vice president at Gartner.

The survey also revealed that mastering business composability makes CIOs and other technology executives better prepared to deliver business value during this period of volatility and beyond.

Business composability is the mindset, technologies, and set of operating capabilities that enable organizations to innovate and adapt quickly to changing business needs. It is built on applying the principle of modularity to business assets to achieve the scale and pace required for growth.

Only 4% of respondents in Australia and 6% globally were rated as ‘highly composable’. Sixty-three percent of CIOs at highly composable organizations reported superior business performance compared with peers or competitors in the past year.

“Australian leaders tend to think of business composability as being an IT thing, instead of a mindset change across the business,” said Rowsell-Jones. “Being a composable business means investing in flexibility and agility, putting in place a modular structure that enables assets to be reconfigured to suit conditions. This offers enormous value, but there’s a lack of pressure for organizations in ANZ to change.”

2022 IT Budget Growth and Spending Plans

According to the survey, IT budgets in ANZ are expected to grow at the fastest rate in over 10 years, with an average growth of 3.1% in overall IT budget for 2022, an increase from 2% in 2021. This is compared to a 3.6% increase globally for 2022.

While cybersecurity is at the top of the list of planned investments for 2022, this is followed by business intelligence/data analytics (58%), integration technologies and APIs (45%), cloud platforms (44%) and digital business transformation (38%).

“This increase in IT budgets means CIOs and technology executives have a greater choice of where to invest,” said Rowsell-Jones. “Without big deficits to remedy elsewhere, they can afford to invest in composability, especially for developers and business architects who can design in a composable manner, as well as invest in packaged business capabilities.”

Distributed cloud (52%) is the leading emerging digital technology that enterprises in ANZ have already deployed or plan on deploying in 2022, followed by artificial intelligence (AI) (35%), edge computing (33%), secure access service edge (SASE) (27%) and 5G (27%). These technologies are a catalyst for business composability because they enable modular technology capabilities.

Technologies set for the biggest decrease in investment by ANZ CIOs and technology executives in 2022 include legacy infrastructure and data center technologies (50%), application modernization (22%) and enterprise resource planning (ERP) (11%).

Digital Progress Continues

In the 2021 Gartner CIO and technology executives survey, ANZ survey respondents reported significant changes in the use of digital channels to reach customers or citizens, and demand for new digital services.

This trend will continue in 2022, with ANZ survey respondents citing almost a quarter of their total revenue is now attributed to digital and more than 50% of enterprise processes have been made more efficient.


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