- 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 for 4 in 10 IT leaders - Huge surge in IT spend isn’t sustainable – as 2020/21 technology budgets come under more strain - 8 in 10 IT leaders concerned about the mental health of their tech teams due to the pandemic
Companies spent the equivalent of around US$15bn1 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 rise2 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, analyzing responses from organizations with a combined technology spend of over US$250bn, also found that security and privacy is the top investment during COVID-19, and cyber security (35%) is now the most “in demand” technology skill in the world. This is the first time a security related skill has topped the list of global technology skills shortages for over a decade. Four in 10 IT leaders report that their company has experienced more cyber attacks, with more than three quarters of these attacks from phishing (83%) and almost two thirds from malware (62%), suggesting that the massive move to home working has increased exposure from employees.
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 (51%) of IT leaders expected a budget rise in the next 12 months, but during the pandemic this number declined to 43%. This still represents a net increase in budgets and remains almost twice as high as IT spend in 2009 - in the wake of the 2008 Global Financial Crisis.
Other key findings from the world’s largest technology survey include:
Sean Gilligan, President, Technology Recruitment – North America, Harvey Nash USA, said, “The digital divide continues to pick up pace. Organizations that have leveraged technology as a strategy in 2020 and not just as a survival tool will outperform and out innovate their competitors. This includes using technology to enable the well-being of their remote workforce, avoid employee burnout, and intelligently scale employee productivity and hiring. This will be a determining factor for companies’ success in 2021.”
Steve Bates, Principal, KPMG in the U.S. 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.”
COVID-19: The business issues the board wants IT to address:
Remote working and the new deal for employees:
Influence of the technology leader:
1Over an eight-week period (June 5 – August 10, 2020), global IT leaders reported a median additional technology spend of 5% to deal with the COVID-19 crisis as a percentage of the total of their annual IT/technology budget. Data from Forrester, published February 3, 2020, shows that global IT spending was forecasted to reach US$3.5 trillion in 2019 and US$3.59 trillion in 2020 (https://go.forrester.com/blogs/new-forrester-forecast-shows-global-tech-market-growth-will-slip-to-3-in-2020-and-2021/). As global IT leaders report a median additional spend of 5% of their IT budgets on technology to deal with the COVID-19 crisis, this was an additional surge/spike in IT spending of around US$175bn (5% of the US$3.5 trillion global IT spend in 2019 forecasted by Forrester) – to deal with the initial impact of COVID-19. This is equivalent to around US$15bn per week during the first three months of the crisis, when this spend would have undoubtedly taken place to support the sudden move to remote/distributed working.
2Analysis by Harvey Nash and KPMG of a range of publicly available global data on IT/tech spending shows that annual rises in spend have tracked at 5% and below for more than a decade, reaching a peak of 5% growth in 2018. For instance, Forrester research, published February 3, 2020, found that the growth in global spending on tech goods and services dropped from a peak of 5% in 2018 to 3.9% in 2019. (https://go.forrester.com/blogs/new-forrester-forecast-shows-global-tech-market-growth-will-slip-to-3-in-2020-and-2021/). As global IT leaders report a median additional spend of 5% of their IT budgets on technology to deal with the COVID-19 crisis, this level of spend, in just three months, is more than their annual budget rise.
3Digital leaders are those that have organizations that are ‘very’ or ‘extremely effective’ at using digital technologies to advance their business strategy.
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 took place in two pulses - one prior to COVID-19 (commencing on December 17, 2019) and one during the pandemic (June 5 – August 10, 2020), across 108 countries.
For more information about the survey and to request a full copy of the results, please visit www.hnkpmgciosurvey.com.
Harvey Nash Inc. is the North American division of the Harvey Nash Group, a global professional recruitment firm and IT outsourcing service provider. Harvey Nash has helped over half the world’s leading companies recruit, source and manage the highly skilled talent they need to succeed in an increasingly competitive, global and technology-driven world. With 2,500 employees in 36 locations across Europe, Asia and North America, Harvey Nash has the reach and resources of a global organization, and it fosters a culture of innovation and agility that empowers all employees across the world to respond to constantly changing client needs. Harvey Nash works with clients, both big and small, to deliver a portfolio of services: IT recruitment, IT outsourcing/offshoring and executive search. To learn more, please visit www.harveynashusa.com. Follow us: www.twitter.com/harveynashusa and www.facebook.com/harveynashusa.
KPMG is one of the world’s leading professional services firms, providing innovative business solutions and audit, tax, and advisory services to many of the world’s largest and most prestigious organizations.
KPMG is widely recognized for being a great place to work and build a career. Our people share a sense of purpose in the work we do, and a strong commitment to community service, inclusion and diversity, and eradicating childhood illiteracy.
KPMG LLP is the independent U.S. member firm of KPMG International Cooperative (“KPMG International”). KPMG International’s independent member firms have 219,000 professionals working in 147 countries and territories. Learn more at www.kpmg.com/us.