Australian CIOs direct IT Budgets towards new Developments

Innovation not operations reaps benefits for CIOs, says Gartner and Telsyte.

Businesses within Asia-Pacific (APAC) have increased their IT budgets year-on-year by 4.3 percent, more so than any other region in the world, outpacing the likes of North America and Europe, according to a new survey conducted by Gartner.

The survey, which captured responses of 544 CIOs from every major industry spread across 19 countries, revealed that APAC businesses are investing more heavily in digital as opposed to other businesses across the globe and that this trend is forecasted to increase in the coming years.

So where exactly are those growing IT budgets being directed? Gartner says that 73 percent of the APAC businesses’ IT budgets were still being spent on operational costs or -- in other words -- ‘keeping the lights on’ while the remaining 27 percent was being spent on transformation or innovation.

However, Australian specific data released from research firm Telsyte confirmed that IT is, in fact, the main driver in transforming organisations in Australia as opposed to more conventional IT spending.

Telsyte's Australian Digital Workplace Study 2017, which involved respondents from 420 Australian CIOs and IT decision makers, revealed that 57 percent of IT budgets are being spent on transformation or innovation programs while only 43 percent on average was being spent on running day-to-day IT operations, which contrasts Gartner’s findings from the wider APAC region.

Telsyte says that Australian CIOs are developing new products and services as the main business priority in order to combat domestic and international competition.

These transformation initiatives are largely underpinned by Business Intelligence (BI)/Analytics, cloud services and digital marketing which make up the key investment areas for businesses in 2016. Telsyte adds that 1 in 3 of respondents are intending to use robotics in some capacity and that 3D printing is gaining traction with 24 percent either using it or have exploratory projects in place.

CIO priorities aren’t likely to change in the near future either with CIOs from Gartner’s APAC survey reporting that Advanced analytics, Internet of Things (IoT) and digital security have the most potential to change their organisation over the next five years. Interestingly, APAC CIOs didn’t see augmented reality and virtual reality as having much of an impact on their business. However, Telsyte’s data says that augmented reality and mixed reality (MR) is of high interest amongst Australian businesses, with 57 percent currently using or intending to use AR/MR technology.

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