Companies spent $15 billion extra on technology per week during pandemic

Companies spent approximately $15 billion extra per week on technology, according to the 2020 Harvey Nash/KPMG CIO Survey. The survey polled 4,200 IT leaders across 108 countries, analyzing organizations with a combined technology spend of over $250 billion.

As many companies were forced to shut down their physical offices in the first wave of the Covid-19 pandemic and transition their people to a remote setting, many had to scramble to ensure their workers had the proper technological infrastructure and security to do their jobs. Meanwhile, retailers rushed to open online storefronts, while other companies examined options for longer term investments into digitalization and automation.

The global CIO survey found that companies spent a mean additional 5% of their IT spend between June 5 and August 10, 2020. Security & privacy were the top spending areas (47%) – with 40% of IT leaders saying their companies experienced more cyberattacks during the pandemic. The massive move to remote work seemed to incentivize cyber criminals, with 83% of attacks being of the phishing variety, while 62% were from malware.Managing technologyMost (86%) of IT leaders said they moved a significant part of their workforce to remote working, and 43% expect over half of their employees to work remotely after the pandemic. This will necessitate a new look at talent strategy, according to Bev White, CEO of tech recruitment firm Harvey Nash. “In a world where location has dissolved, where the office now includes the kitchen table, and where over 80% of IT leaders are concerned about the mental health of their teams, organizations will need to reformulate their employee offer to attract and retain the talent they need to support them through the pandemic, and beyond.”

After security and privacy (47%) and customer experience (44%), infrastructure and cloud (35%) was the third most popular tech investment during the pandemic. The survey found that the number of IT leaders considering distributed cloud nearly doubled in 12 months, from 11% to 21%.

Tech budgets will, however, be strained in the year ahead. Before the pandemic, 51% of IT leaders expected budget increases and 55% expected headcount increases in the next 12 months. Now, only 43% expect budget increases and 45% plan to grow headcount. This is still a net increase in budgets, however, and is almost twice as high as IT spend in 2009, following the financial crisis.Resourcing the tech teamSteve Bates, principal, KPMG US and global leader of KPMG International’s CIO Center of Excellence, said, “IT in the New Reality will be shaped by economic recovery patterns unique to each sector, location, and company. While every CIO is responding to these forces differently, one thing remains consistent; the urgency to act swiftly and decisively. Technology has never been more important to organizations’ ability to survive and thrive.”

The survey found that “digital leader” companies were more likely to make additional tech investments as a result of the pandemic. The 30% of companies that are “very or extremely effective” at using digital technology to advance their business strategy were also four times better at operational efficiency, three times better at customer experience, and thee-and-a-half times better at increasing revenues.

The most in-demand skill identified by IT leaders was cyber security (35%), followed by organizational change management (27%), enterprise architecture (23%), and technical architecture and advanced analytics (both 22%).

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