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The 2019 Gartner Survey is in and it has some incredible findings. Gartner, an analyst firm, queried over 3000 CIOs about spending on IT with the results showing that enterprises are reaching the third era of IT.

The 2019 Gartner CIO Agenda survey gathered data from more than 3,000 CIO respondents in 89 countries and all major industries, representing approximately $15 trillion in revenue/public-sector budgets and $284 billion in IT spending.

The Gartner Survey indicates that digital business has reached a tipping point. Forty-nine percent of respondents report their enterprises are in the process of changing their business models or have already changed them. Digital initiatives, along with growth, are now the mainstream in company budgets. This trend is true for Australian businesses as well. Gartner projects that Australian IT spending to be almost AU$94 billion, up 3% from last year with a likelihood to increase to AU$105.7 billion by 2022. According to Gartner, “IT Services remains as Australia’s biggest IT spending category from 2018-22, with spending for this category expected to increase by 4.4% to AU$34.4 billion in 2019.” A large percentage of this growth is caused by the switch from traditional IT offerings to cloud-based alternatives that require new software that many companies are just beginning to install.

How Do Changes in Digital Business Affect My Organisation?

In order to stay competitive, businesses and organisations will continue to scale their adoption of digital channels for marketing, customer engagement, and business transactions. According to the Gartner Survey, “33 percent of respondents worldwide evolved their digital endeavours to scale, up from 17 percent in the previous year. The major driver for scale is the intent to increase consumer engagement via digital channels.” Customers are increasingly relying on digital channels to browse, shop, become educated, and send feedback and questions to potential vendors. This behaviour affects companies of all sizes, and is often a cost-effective way to interact with clients and prospects.

How is the Ability to Support Greater Scale Beneficial?

There are three areas where the ability to support greater scale is being developed, specifically scope, volume, and agility. These areas encourage consumers to interact in some manner with an organisation. By providing a variety of actions and digital services, consumers become more engaged and invested in a brand.

Should the IT Budget Be Increased?

The survey supports the growth of respondents’ IT budgets. Globally, “CIOs expect their IT budgets to grow by 2.9 percent in 2019.” Gartner recommends using financial resources to transform IT departments in 2019, to invest time, money, and human resources to remove barriers to change. Not making this investment will put enterprises at a competitive disadvantage going forward.

What are the Top Emerging Technologies to Invest In?

Big changes are coming to IT that are shaping future developments in the economics of all organisations. Respondents to the Gartner Survey reported that artificial intelligence (AI) was the most influential new technology when it comes to affecting consumer interactions. Data and analytics came in second place. However, when asked about implementation, 37 percent of respondents said that they already deployed AI technology or it was in their short-term plans. The top concern for implementation was cyber security at 88 percent.

AI is still in its infancy, with many current tools untested. While companies should take a serious look at this technology, the strong focus on cybersecurity proves the necessity to create a secure base for all digital business that protects both the clients and organisation. Currently, in most enterprises the internal IT team is responsible for digital security. However, the rise in social engineering attacks including phishing, require broader education and behavioural changes for all employees.

According to Gartner, in 24 percent of the digitally top-performing companies, the board of directors is accountable for cybersecurity as well as the CIO. Still, to improve digital security, a combination of measures to harden information-processing assets along with further education of staff that uses technology is critical. Putting a growing digital business on a secure and stable base is the best foundation for the third era of enterprise IT. Then, a sound strategy can help balance new technology such as AI, and balance it with already existing digital investments.

How Can Implementing AI Help My Company?

Although AI is still new and developing technology, “the number of enterprises implementing artificial intelligence (AI) grew 270 percent in the past four years and tripled in the past year,” according to the Gartner 2019 CIO Survey. In fact, the deployment of AI rose from 25 percent in 2018 to 37 percent today. The primary reason for this leap in usage is that AI capabilities have improved significantly, making it easier to implement. So far, AI doesn’t have the capability to take over complex tasks, but it can augment work and decision-making. Sustainable digital transformation and task automation are integral to scaling digital technology. AI is a big part of this digital strategy.

Common uses for AI include chatbots as well as computer-assisted diagnosis for healthcare. Other operational uses are fraud protection and consumer fragmentation. The largest obstacle to installing AI for companies is the lack of talent to deploy it. If no AI talent is readily available, a possibility is to invest in training for employees with skills in data management and statistics.

Published on 1st July 2019 by Ian Brady.

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