Businesses Spent $15bn More A Week On Technology During Pandemic – KPMG, Harvey Nash

Businesses around the world spent the equivalent of $15bn extra a week on technology as they transitioned to remote working as a result of the pandemic.

Businesses around the world spent the equivalent of $15bn extra a week on technology as they transitioned to remote working as a result of the pandemic, according to the 2020 Harvey Nash/KPMG CIO Survey.

Harvey Nash and KPMG claim it is the largest IT leadership survey in the world, with over 4,200 CIOs and technology leaders taking part across 108 countries. This year the survey was split into two – one prior to Covid-19 and one during the pandemic.

The survey found that over an eight-week period, between 5 June and 10 August, global technology 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 budget.

Using data from Forrester, whereby global IT spending was forecast to reach $3.59 trillion in 2020, Harvey Nash and KPMG estimate that the additional surge in IT spending would have been around $175bn to deal with the impact of the pandemic. Harvey Nash and KPMG believe that this surge is one of the biggest in history for IT spend because yearly IT growth peaks at 5% and this sudden surge was only over a three month period.

The IT leaders top investments were security and privacy (47%), customer experience and engagement (44%), infrastructure/cloud (35%), automation (29%) and business intelligence (25%).

Despite this sudden surge in near-term investment, budget growth expectations for IT leaders for the next 12 months have dropped. Before the pandemic, 51% of respondents expected budget increases and 55% were planning on growing headcount. Now, budget increases are expected for 43% and headcount increases for 45%. This still represents a net growth and remains significantly higher than in 2009 after the financial crisis.

Bev White, CEO of Harvey Nash Group explained that this is because tech investment can’t simply now drop-off.

“Businesses need to grow their digital channels, they’re essential, not a nice-to-have. Of course, organizations need to look at how they can take out cost moving forward, but technology won’t be an area to slash. On the contrary it’s investments in technology such as AI and cloud that will enable them to increase automation and achieve cost efficiencies,” she said.

This article was written by Sooraj Shah from Forbes and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to legal@industrydive.com.