Australian companies have demonstrated a readiness to invest in emerging technologies. However, this enthusiasm is being tempered by a heightened focus on accountability and strategic alignment due to the current economic landscape.
Following its nearly $5 billion acquisition by IBM, Apptio shared its insights with TechRepublic regarding the priorities of Australian organizations. Key considerations such as accountability, risk management, and talent shortages are shaping how these enterprises allocate their limited resources.
### The Evolving Landscape of the Australian Market
Apptio acknowledges the increasing sophistication with which Australian businesses approach and manage their technology expenditures. While companies are prepared to invest in IT services, they expect accountability for the outcomes.
Pete Wilson, Vice President of Apptio Business and General Manager for APAC, remarked that Australian companies increasingly recognize that “technology is not simply free.” He elaborated, “If there’s a commitment to grow revenue by a specific percentage and additional investments that incur extra costs are needed, we’re observing a more mature dialogue. Decisions regarding technology adoption are now backed by a clear demonstration of value to the business.”
### Economic Pressures Driving Change
With rising capital costs, businesses, particularly CIOs, face greater pressure to validate their IT spending. This challenge is further exacerbated by a significant skills shortage in key areas such as AI and data science.
“You often hear this: even when funding is available, finding the right talent can be difficult,” said Ajay Patel, General Manager at Apptio and IBM IT Automation. “There’s a heightened focus on aligning available skills with the most strategic projects that offer the highest return on investment.”
This talent scarcity is not only a local challenge but a global one, affecting the Australian market as companies strive to balance hiring costs with the need to advance strategic initiatives. “High-demand skills like AI expertise are hard to come by, making it challenging for businesses to connect domain experts with data scientists who can implement necessary technological changes,” Patel added.
### Rising Interest in FinOps in Australia
Apptio has observed considerable growth in Australia’s adoption of FinOps and cloud optimization practices.
“The APAC region, especially Australia, has displayed a strong interest in rigorous cloud management and optimization,” Wilson noted, adding that this trend has accelerated noticeably over the past year. In the realm of FinOps, the focus isn’t solely on managing cloud costs; it also involves applying the principles of financial accountability across all IT sectors. However, talent shortages remain an ongoing concern.
“We’re witnessing a significant shift toward FinOps as businesses aim to integrate these disciplines into traditional on-premises environments,” Wilson explained. “The demand for skilled FinOps professionals is exceptionally high right now, particularly among large organizations that are beginning to adopt these practices.”
### Cybersecurity at the Forefront of IT Investment
Cybersecurity has emerged as a paramount concern for Australian businesses, partly propelled by governmental efforts to enhance cybersecurity measures.
“Increased funding is being allocated to the cybersecurity sector, a trend that seems poised to continue,” Wilson stated. “Cyber investments rank high in prioritization, as boards today are much more cognizant of the potential repercussions of breaches, which extend beyond reputational damage to include regulatory fines and legal ramifications.”
In Australia, companies are also compelled to devote a significant portion of their IT budgets to comply with new regulations. Wilson stated, “Cybersecurity is commanding an increasingly larger share of budgets, and this trend will persist until compliance with regulatory shifts is effectively managed.”
### Validating IT Expenditures in an Uncertain Economy
The prevailing economic environment is marked by uncertainty, complicating the task for CIOs and IT leaders to justify technology investments.
“The outlook is uncertain, and the expectations for justifying business cases or implementing changes are notably high,” noted Patel. “CIOs are pressured to demonstrate optimization of their current IT operations before they can procure additional funding. This represents a significant departure from the past, where technology expenditures were frequently regarded as a given.”
In addition to enhancing existing operations, CIOs are now expected to illustrate how new investments will yield tangible business benefits. “There is amplified pressure on CIOs to substantiate what value they will return to the business from these new investments,” Patel emphasized, particularly as the economic landscape continues to tighten.
