Kyndryl’s Gavin Goveia talks about the IT ‘tipping points’ impacting organizations and why businesses are re-evaluating their data strategies.
Last month, Kyndryl released a report highlighting the significant increase in pressure on business leaders to prove a positive return on investment when it comes to AI, as it found that AI spending has increased by 33% 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 61% of business leaders feel more pressure to prove their AI investments compared to a year ago, and more than half (54%) report positive returns.
The report found that overall AI readiness has improved since last year’s survey, with 36% reporting full readiness, while 62% said their AI projects have not progressed beyond the pilot stage.
Gavin Goveia, UK and Ireland Kyndryl Consult Leader, said:
“However, it is in scaling up from proof of concept to actual product that companies are finding barriers. More than half of respondents said pilots often stall at this stage, pointing to infrastructure complexity and regulatory concerns.
“Learning how to adjust tool design to organizational realities early in the process is essential to minimizing wasteful spending and deadlock.”
data and cyber
The Kyndryl Readiness Report found that due to continued geopolitical pressures regarding cloud and data trends, businesses are now reevaluating their strategies, including where and how data is accessed, stored, processed, and protected.
Goveia told SiliconRepublic.com there are many reasons for this.
“We can identify several specific factors contributing to this situation: new regulatory activity around data sovereignty, delays due to supply chain and trade disruptions, and potential international instability and conflict,” he says. “Interestingly, a portion of respondents (approximately 8 in 10) said each of these has become more important in their technology modernization decisions.
“Geopolitics is not putting the brakes on cloud investing, but it is adding more complexity.”
One finding that particularly surprised Goveia was that while 75% of respondents were “increasingly concerned” about geopolitical risks associated with the global cloud environment, the least concerned groups were those in the United States and China.
“The shift in thinking about data strategy is definitely something to watch over the next 12 months.”
Cybersecurity remains a top concern for businesses, with only 37% of business leaders feeling prepared for cyber threats. The report also found that 82% of businesses experienced a cybersecurity-related outage in the past year.
Companies appear to be turning to AI to aid in cyber resilience, with three in four companies investing in AI for cybersecurity. Goveia says this is bigger than any other AI capability.
A strong technological infrastructure is key to strengthening cyber resilience and promoting AI-driven cybersecurity. However, Kyndryl’s research found that technology infrastructure pitfalls are a cause for concern for responding companies.
According to Kyndryl’s statistics, 25% of “mission-critical” networking, storage and servers are facing end-of-service, and Goveia said “this feels like a significant issue given the pressure to invest in net new capabilities.”
Meanwhile, 57% of business leaders say their innovation efforts are often delayed by “fundamental issues” in their technology stack.
turning point
As part of Kyndryl’s report, companies were divided into three categories based on their level of workplace readiness: pacesetters, followers, and laggards.
But where do pacesetters succeed and where do laggards fall short?
“The biggest gaps we see are generally in the technical and organizational foundations,” Goveia said. “Pacesetters are 35 points more likely to say their IT infrastructure is ready to handle future disruption, 30 points more likely to say their cloud infrastructure gives them flexibility and adaptability, and 30 points more likely to say their CTO/CIO has a clear understanding of business strategy.
“While small differences exist in areas such as workforce AI usage, the fundamentals are in place to help organizations cope with complexity.”
Overall, Goveia said key aspects of this year’s preparedness report indicate uncertainty about the future.
“Perhaps the most important and revealing data point in this year’s report was around the impact of AI on how people work. 87% of respondents said AI will completely change their organization’s roles and responsibilities this year,” he said. “But I think it’s clear that a positive outcome is not guaranteed given the scale-up challenges around AI, geopolitical pressures and additional hurdles placed on companies’ paths.
“So we are at an inflection point. By the next readiness report, we will have a clearer picture of how our leaders have steered their modernization efforts on different paths in terms of revenue, value, and performance.”
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