Global tech leaders spent billions to secure work from home

Companies globally spent the equivalent of around US$15B extra a week on technology to enable safe and secure home working during COVID-19, reveals the 2020 Harvey Nash/KPMG CIO Survey. This was one of the biggest surges in technology investment in history – with the world’s IT leaders spending more than their annual budget rise in just three months, as the global crisis hit, and lockdowns began to be enforced.

The largest technology leadership survey in the world of over 4,200 IT leaders (265 based in Australia), analysing responses from organisations with a combined technology spend of over US$250B, also found that despite this huge surge of spending, and security & privacy being the top investment during COVID-19, 4 in 10 Australian IT leaders report that their company has experienced more cyber attacks.

About nine in ten (89 per cent) reported an increase in phishing attacks, and over two thirds (77 per cent) of these from malware (suggesting that the massive move to home working has increased exposure from employees.

At the same time, Australian organisations have struggled to find skilled cyber security professionals to support this dramatic shift to homeworking – with 42 per cent of Australian CIOs reporting that cyber security is now the most ‘in demand’ technology skill. This is one of the first times a security related skill has topped the list of global technology skills shortages for over a decade.

Bruce Goldsmith managing director at recruitment firm, Harvey Nash Australia said with many employees working remotely, the threat of security 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,” he said.  “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.”

Although technology spend has risen dramatically during the pandemic, the survey found that technology budgets will be under more strain over the year ahead. Prior to COVID-19, over half (55 per cent) of Australian IT leaders expected a budget rise in the next 12 months, but during the pandemic this number declined to 38 per cent. This still represents a net increase in budgets.

Other key findings from the world’s largest technology survey include:

• Digital companies pull away – Digital leaders]were more likely than non-digital leaders to make additional technology investments as a result of COVID-19 – with 50 per cent more organisations that are ‘very’ or ‘extremely effective’ at using digital technologies spending an additional 21-50 per cent globally –  notably  in Australia this figure is three times more. These investments focused on large-scale implementations of Distributed Cloud (42 per cent – 30 per cent in Australia) and SaaS (34 per cent – 32 per cent in Australia). The crisis has served to emphasise a growing divide between organisations driving their strategy through technology, and those that aren’t.
• Concerns over mental health – 9 in 10 Australian IT leaders during COVID-19 are concerned about the mental health of their team which has resulted in 8 in 10 IT leaders (78 per cent) putting programs in place to support their staff.
• Cloud investment up – After investment in security and privacy (58 per cent), investment in infrastructure and the cloud was the third (fifth in Australia) most important technology investment during COVID-19, with the number of IT leaders actively considering Distributed Cloud nearly doubling in just 12 months (from 11 per cent to 21 per cent).  This has tripled in Australia from 7 per cent in 2019 to 22 per cent during the COVID-19 pandemic.
• Skills shortages – Prior to COVID-19, 2020 skills shortages remained close to an all-time high. Subsequently, shortages in tech talent have remained high. In addition to cyber security skills (42 per cent), the next three most scarce technology skills are organisational change management (24 per cent), advanced analytics (24 per cent) enterprise architecture (22 per cent) and IT strategy (17 per cent).

This unexpected and unplanned surge in technology investment has also been accompanied by massive changes in how organisations operate – with more organisational change in the last six months than we have seen in the last ten years, noted Bev White CEO at Harvey Nash Group “Success will largely be about how organisations deal with their culture and engage with their people,” she said. “In a world where location has dissolved, where the office now includes the kitchen table, and where over 80 per cent of IT leaders are concerned about the mental health of their teams, organisations will need to reformulate their employee offer to attract and retain the talent they need to support them through the pandemic, and beyond.”

COVID-19: The business issues the board wants IT to address:

• Digital Transformation – For almost half (42 per cent) of Australian IT leaders COVID-19 has permanently accelerated digital transformation and adoption of emerging technology (AI, ML, blockchain and automation).
• Marketplace Software as a Service (SaaS) – This is the big winner compared to 2019. Large-scale implementations more than tripled from 7 per cent in 2019 to 23 per cent this year. One in six organisations put one in place in the last 12 months.
• Remote working and the new deal for employees:
• Remote working is here to stay – 85 per cent of Australian IT leaders moved a significant part of their workforce to remote working, and 53 per cent expect half or more of their employees to work from home in some capacity after the pandemic.
• Collaboration and culture – As a result of remote working, 74 per cent of Australian IT leaders report increased collaboration between the business and technology teams and over half (58 per cent) said that it has created a culture of inclusivity in the technology team.
• The new deal for employees – Work location and remote working has risen to become one of the five most important factors for engaging and retaining key technology talent during, and after, COVID-19. Leaders will therefore need to rethink how they attract and engage their employees in a world where physical location is no longer a prime asset.

Influence of the technology leader:

• Influence on the rise – Almost two thirds (62 per cent) stated that the pandemic has permanently increased the influence of the technology leader.
• Board membership – Australia bucked a downward trend globally for board memberships, rising from 58 per cent in 2018 to 60 per cent of CIOs, IT Directors and CDOs on the main board in 2020.

Diversity:

• Women in Tech still an issue – The gender diversity of technology leaders remains broadly unchanged from last year’s survey (11 per cent).
• Promoting Diversity – 28 per cent in Australia of IT leaders feel that their organisation is successful at promoting diversity, and this has improved trust and collaboration in the technology team (52 per cent), and engagement with the business (48 per cent).

The full report will be released in early October 2020, CIO Tech Asia will have an update of the spend for APAC once its released.