Kyndryl’s Gavin Goveia discusses the IT ‘tipping point’ affecting organisations and why businesses are re-evaluating their data strategies.
Last month, Kyndryl released a report highlighting a significant rise in pressure for business leaders to prove positive return on investment in relation to AI, as AI expenditure was found to be up 33pc compared to last year.
The second edition of the Kyndryl Readiness Report – which gathered responses from 3,700 senior leaders across 21 countries – found that 61pc of business leaders are feeling more pressure to prove their AI investments compared to a year ago, with more than half (54pc) reporting positive returns.
While the report found that overall AI readiness has increased since last year’s survey – with 36pc reporting complete readiness – 62pc said that their AI projects haven’t advanced beyond the pilot stage.
“The initial on-ramp to AI-enabled functionality is becoming smoother,” said Gavin Goveia, Kyndryl Consult leader for the UK and Ireland.
“Where businesses are finding a barrier, though, is in scaling from proof-of-concept to real-world products: over half of respondents said that their pilots often stall at this stage, and they’re pointing the finger at infrastructure complexity and regulatory concerns.
“Learning how to align the design of a tool with the reality of the organisation earlier in the process will be vital to minimise wasted spend and dead ends.”
Data and cyber
In terms of cloud and data trends, the Kyndryl Readiness Report found that businesses are now reevaluating their strategies – including where and how their data is accessed, stored, processed and secured – due to ongoing geopolitical pressures.
Goveia told SiliconRepublic.com that this is due to a number of reasons.
“We can identify a few specific factors that play into this picture: new regulatory activity around data sovereignty, delays due to supply chain and trade disruption, and potential international instability or conflict,” he says. “Interestingly, a portion of our respondents (around eight in 10) said that each of these is becoming more important in their tech modernisation decision-making.
“While we’re not seeing geopolitics put the brakes on cloud investment, it is adding further complexity.”
One finding that particularly surprised Goveia is that despite 75pc of respondents becoming “increasingly concerned” about the geopolitical risks associated with global cloud environments, the least concerned groups are respondents from the US and China.
“Changing attitudes around data strategies will certainly be something to watch in the next 12 months.”
Cybersecurity remains a top concern for businesses, with just 37pc of business leaders feeling completely prepared for cyberthreats. The report also found that 82pc of businesses experienced a cybersecurity-related outage in the past year.
It seems as though businesses are turning to AI to assist with their cyber resilience, with three in four organisations investing in AI for cybersecurity – which Goveia stated is more than any other AI capability.
Key to reinforcing cyber resilience – as well as facilitating AI-driven cybersecurity – is strong technical infrastructure. However, Kyndryl’s survey found that tech infrastructure pitfalls are a cause for concern for responding businesses.
Kyndryl statistics found that 25pc of “mission-critical” networks, storage and servers are at end-of-service, which Goveia said “feels like a key issue considering the pressure to invest in net-new capabilities”.
Meanwhile, 57pc of business leaders stated that tech innovation efforts are often delayed by “foundational issues” in their tech stack.
Tipping point
As part of Kyndryl’s report, businesses were sorted into three categories depending on their level of workplace readiness: pacesetters, followers and laggards.
But where are the pacesetters succeeding and laggards falling short?
“Where we see the biggest gaps is generally in the technological and organisational fundamentals,” said Goveia. “Pacesetters are 35 points more likely to say their IT infrastructure is ready to manage future disruption, 30 points more likely to say that their cloud infrastructure is giving them flexibility and adaptability, and 30 points more likely to say that the CTO/CIO has a clear understanding of the business strategy.
“While smaller gaps exist in areas like rate of employees’ AI usage, it’s getting the basics into line that enables organisations to grapple with the complexities.”
Overall, Goveia said that a considerable aspect of this year’s readiness report is the uncertainty it presents about the future.
“The most important and unequivocal datapoint from this year’s report might have been about the impact of AI on what people’s jobs look like: 87pc of respondents said it will completely transform roles and responsibilities at their organisations this year,” he said. “But, if we look at the scaling challenges around AI, and the additional hurdles that geopolitical pressures are placing in companies’ paths, I think it’s clear that good outcomes are not guaranteed.
“That makes the present moment a tipping point, and I think that, by the next edition of the Readiness Report, it will be clearer how the pacesetters have tipped onto a different path in terms of returns, value and performance in their modernisation journeys.”
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