Wednesday, May 22, 2024

EY Ireland Tech Leaders Outlook 2024: AI, Cybersecurity & Talent top the agenda while Cloud adoption soars

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  • High level of Artificial Intelligence (AI) interest among Irish tech leaders, but more than six in ten (62%) not yet investing in AI technologies and do not have an AI strategy
  • Increased cyber risks (38%) and talent management (37%) top two challenges for tech leaders, while sustainability reporting tools most valuable emerging tech (43%)
  • Full cloud adoption more than doubles year-on-year to 32%
  • Just 6% of organisations have a formal usage policy for Generative AI, six in ten (59%) say unlicensed use of Generative AI is likely common in their workplace

Dublin, 9 May 2024: Tech leaders in Ireland are reporting strong interest in the transformative potential of AI, but this is not yet turning to action for the majority of organisations, with more than 6 in 10 (62%) saying they are not yet investing in AI technologies and do not have an AI-related strategy in place. That’s a key finding of EY Ireland’s Tech Leaders Outlook Survey 2024, which surveyed 150 senior technology leaders from organisations based in Ireland.

When it comes to Generative AI (GenAI), 13% of respondents say they are developing or have already developed their own Large Language Models and/or GenAI tools, while 6% say that their organisation has a formal policy on acceptable usage of unlicensed GenAI tools. Almost one in five (18%) say that GenAI tools are prohibited outright while almost six in ten (59%) tech leaders say that unlicensed GenAI is most likely being used by their employees, but no formal usage policy is in place. This ‘Shadow AI’ usage has the potential to expose organisations to issues across a range of areas including on data privacy and transparency.

Cybersecurity risks have emerged as the top issue for tech leaders in 2024, with almost four in ten (38%) rating this as their most significant challenge, an increase of 4% when compared to last year (34%). Turning to the specific elements of cybersecurity, elevated cyber risks and management of data protection and flows were identified by 61% of respondents as a critical challenge, up from 53% in 2023. A quarter of respondents pointed to their organisation’s vulnerability to cyberattacks as an area of concern.

Difficulty in attracting and retaining talent was highlighted as the second biggest issues for tech leaders (37%), although this was a decrease when compared with last year (45%). Thirty-eight percent of respondents expect to increase the capacity of their IT function over the next two years, slightly up from 2023. But 27% say a shortage of skilled employees to implement new technology is a significant barrier to executing their technology related agenda, up from 18% in 2023.

Sustainability management and reporting tools have been identified as the top technology that Irish tech leaders believe will deliver the most value to their organisations over the next two years, up significantly this year to 43% from 26% in 2023. There is widespread recognition that upcoming regulations at a European and global level, including the Corporate Sustainability Reporting Directive, and the Corporate Sustainability Due Diligence Directive are setting new sustainability standards and requirements for organisations and technology will play a key role in supporting their compliance. General AI / Machine Learning (33%) and Generative AI (GenAI) and Employee Assisted Technologies (27%) rank second and third among emerging technologies that are expected to deliver most value to organisation over the coming two years.

Ronan Walsh, Head of Technology Consulting at EY Ireland, said: “Today’s technology leaders are focused on ensuring that the technology upon which their core business functions operates seamlessly, that their systems are protected from ever more complex cyber threats, and that the correct digital infrastructure is in place so that the business can quickly seize new growth opportunities.   

“Our Tech Leaders Outlook takes the temperature of 150 experts based in Ireland on an annual basis, to understand what is front of mind for them right now and what the challenges and opportunities are as they look to the future. While the growing interest in AI is clear, our research shows that a large majority of organisations have yet to turn turned this interest into concrete action or develop an AI strategy. Instead, they are focusing on more immediate issues such as cloud migration, cybersecurity and utilising technology to help them with regulatory requirements.

“While this somewhat cautious approach to AI is typical of the technology adoption lifecycle, the game changing opportunities that AI – and GenAI in particular – can offer organisations mean that it is imperative that tech leaders develop robust AI policies and take advantage of this breakthrough innovation or risk getting left behind by their peers. Integrating strong governance with innovative AI applications can help businesses unlock new opportunities responsibly and sustainably while securing a competitive edge in the digital age.

“Elsewhere, the competition for talent continues. Retaining skilled staff is critically important as replacing them may prove difficult in what remains a tight talent market. Tech leaders perspective on the importance of technology to manage regulatory reporting in the areas of sustainability and cybersecurity is also notable, particularly considering the scale of the challenge presented by new reporting sustainability requirements such as the CSRD and the CSDDD, and in terms of cybersecurity NIS2 and DORA.

Cloud adoption soars and culture key to successful transformation

The number of organisations hosting all their corporate systems in the cloud has more than doubled to 32% from just 15% in 2023, while one third (33%) are pursuing a cloud strategy and are in the process of migrating away from on-premise infrastructure. As full cloud adoption soars, the number retaining critical systems on premises and using cloud for less sensitive data has fallen to 17%.

Ronan Walsh added: “These results indicate a surge in trust and confidence in cloud technology. Our surveys over the past two years show that Irish organisations have successfully made the switch from on-premise infrastructure to cloud-based solutions. This marked rise in cloud adoption underscores the recognition of its benefits, such as scalability, flexibility and cost-effectiveness, across industries. This indicates the degree to which the cloud has matured as a technology and become the default for many organisations. Indeed, with more than 80% of organisations either on the cloud or migrating to it, the adoption phase would appear to be nearing its end.”

Finally, the survey found that Irish technology leaders (40%) indicate their organisations are currently planning or executing a transformation or change programme. Having the right organisational culture in place is the most important success factor when it comes to for transformation programmes, reflecting a notable shift from last year’s survey, rising from sixth place in 2023 to first.

For more key insights about EY Ireland Tech Leaders Outlook Survey 2024, visit ey.com/ie/TechSurvey.

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About the survey

Research for the EY Ireland Tech Leaders Outlook Survey 2024 was carried out on behalf of EY by Empathy Research during February – March 2024. 150 people working in senior technology roles across a broad spectrum of organisations responded to the survey. The sectors covered for the survey were broadly financial services, advanced manufacturing, government and public sector, consumer products and retail, construction, food and beverage, biomedical technologies, power and utilities, agriculture, education, life sciences and leisure, tourism, and sport.

EY

EY exists to build a better working world, helping to create long-term value for clients, people and society and build trust in the capital markets. Powered by data, technology and an extensive partner ecosystem, our diverse EY teams in over 150 countries provide trust through assurance and help clients grow, transform and operate. Working across assurance, consulting, law, strategy, tax and transactions, EY teams ask better questions to find new answers for the complex issues facing our world today.

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