COVID-19 forces one of the biggest surges in tech investment in history, finds world’s largest tech leadership survey

COVID-19 forces one of the biggest surges in technology

As companies began to feel the effect of COVID-19, the world’s IT leaders spent more than their annual budget increase in just three months, reveals the 2020 Harvey Nash/KPMG CIO Survey – the world’s largest technology leadership survey.

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  • Globally, companies spent around US$15bn extra a week on technology during the pandemic’s first wave
  • Security and privacy the top investment, but cyber-attacks jump by 25%.
  • Huge surge in IT spend isn’t sustainable – as 2020/21 technology budgets come under more strain
  • 9 in 10 IT leaders concerned about the mental health of their tech teams due to the pandemic

 

As companies began to feel the effect of COVID-19, the world’s IT leaders spent more than their annual budget increase in just three months, reveals the 2020 Harvey Nash/KPMG CIO Survey – the world’s largest technology leadership survey.

Despite this huge surge of spending, and security & privacy being the top investment since the start of the pandemic, 25% of IT leaders report that their company has experienced more cyber-attacks. More than a third of these attacks were from phishing (42%), and almost a quarter from malware (23%), suggesting that the massive move to home working has increased exposure from employees.

Meanwhile, organizations have struggled to find skilled cyber-security professionals to support this dramatic shift to homeworking. In Belgium, cyber security is now the second most ‘in demand’ technology skill (11%) after Enterprise Architecture (12%), while it is the number one skill demanded globally amidst a shortage of skilled professionals.

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 measures, almost half (45%) of IT leaders expected a budget increase in the next 12 months, but during the pandemic this number declined to 38%.

Survey results for Belgium highlighted four important trends:

  • Digital companies pull away: The crisis emphasized a growing divide between organizations driving their strategy through technology and those that aren’t. Digital Leaders were more likely than non-digital leaders to make additional technology investments as a result of COVID-19. In Belgium, investments focused on small scale implementations of AI & Machine Learning (45%), SaaS (36%) & Intelligent Automation (27%), Distributed Cloud (18%).
  • Concerns over mental health: 9 in 10 IT leaders are concerned about the mental health of their team, which has resulted in 7 in 10 IT leaders (66%) putting programs in place to support their staff during COVID-19 measures.
  • Cloud investment up: After investment in security and privacy (51%), customer experience & engagement (49%) and infrastructure & cloud have been the second and the third most important technology investments during the pandemic, with the number of IT leaders actively considering Distributed Cloud nearly doubling in just 12 months (from 13%->24%).
  • Skills shortages: Prior to COVID-19, 2020 skills shortages remained close to an all-time high. After COVID, in addition to enterprise architecture (26%), the scarcest technological skills are cybersecurity (23%), technical architecture (23%), IT strategy (20%) and advanced analysis (14%).

Shift in Board priorities for IT as a result of COVID-19:

Before COVID-19 measures in Belgium:

1.       Improving operational efficiency

2.       Improving customer engagement

3.       Developing new products and services

4.       Gaining actionable insights from data

5.       Delivering stable and consistent IT performance

After COVID-19 measures in Belgium:

1.       Improving customer engagement

2.       Improving operational efficiency

3.       Improving agility and speed to market

4.       Delivering stable and consistent IT performance

5.       Enabling the workforce

  • Workforce enablement – In previous years, this has tended to be a mid-ranking priority for technology leaders, but it has jumped to the top five, driven by the mass move to remote working. Operational efficiency and customer engagement keep their top positions, but the purpose of these have changed in the light of COVID-19.
  • Digital Transformation – For a majority of Belgian IT leaders (51%), COVID-19 has permanently accelerated digital transformation and adoption of emerging technology (AI, ML, blockchain and automation).
  • Emerging technologies – Small scale implementations of Artificial Intelligence (AI) and Machine Learning (ML) have risen by 1% from 25% before COVID-19 to 26% now.
  • Marketplace Software as a Service (SaaS) – This is the big winner compared to 2019. Large-scale implementations in Belgium have almost doubled since the start of the COVID-19 measures (from 17% by March 2020 to 29% by August 2020).

Remote working and the new deal for employees:

  • Remote working is here to stay – 95% of IT leaders moved a significant part of their workforce to remote working, and 47% expect more than half of their employees to work from home after the pandemic.
  • Collaboration and culture – As a result of remote working, more than half (52%) of IT leaders report increased collaboration between the business and technology teams while less than half (43%) said that it has created a culture of inclusivity in the technology team.
  • The new deal for employees – Work location & remote working has risen to become one of the four most important factors for engaging and retaining key technology talent. Leaders need to rethink how they attract and engage their employees in a world where physical location is no longer a prime asset.

 

Anthony Van De Ven, Partner-Technology Advisory, KPMG Belgium said:

“The pandemic has exposed an increasing digital divide and further accelerated digital transformation. Meanwhile, board priorities have remained the same: improving operational efficiency and customer engagement are still top of mind for all Technology Leaders. While it’s important for each organization to identify their own specific pathway to recovery, the ability to act swiftly and decisively remains key to surviving and thriving in the New Reality. To do so, the focus of Technology Leaders should be on increasing their organizational agility and embedding digital thinking into their organization’s DNA.”

 

Ronny Lommelen, Managing Director, Harvey Nash Belgium, said:

“This unexpected and unplanned surge in technology investment has also been accompanied by massive changes in how organizations operate – with more organizational change in the last six months than we have seen in the last ten years. Success will largely be about how organizations deal with their culture and engage with their people. 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.”

 

About the Survey

In its 22nd year, the 2020 Harvey Nash/KPMG CIO Survey is the largest IT leadership survey in the world in terms of number of respondents. The survey of over 4,200 CIOs and technology leaders in organizations with a combined technology spend of over US$250bn, took place in two pulses - one prior to COVID-19 (commencing on 17th December 2019) and one during the pandemic (5th June – 10 August 2020), across 108 countries.

 

For more information about the survey and a full copy of the results, please visit www.hnkpmgciosurvey.com

© 2022 KPMG Advisory, a Belgian civil CVBA/SCRL and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.

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