Across industries, leaders face simultaneous demands from AI, cybersecurity and geopolitics as they modernise estates and workflows. Findings informed by Kyndryl’s readiness dataset indicate investment is rising, yet integration hurdles, legacy constraints and uneven skills continue to hold back outcomes. Healthcare shows similar patterns, with signals on end-of-service exposure, cloud choices and automation density.
Foundations Under Strain
Readiness for external business risks remains limited. Only 31% of respondents describe themselves as completely ready, and 37% feel prepared for cyberattacks. Disruptions stem from security incidents and non-security causes such as human error, connectivity faults, data centre issues and vendor-related events. Three in five do not believe their IT is equipped for future risks, and the proportion reporting full readiness across infrastructure, cybersecurity and resilience stays below two thirds.
Modernisation is most frequently cited as a mitigation approach, alongside cybersecurity controls. Those reporting positive returns on AI are more likely to pursue both. Investment in AI has increased, with three in four leaders reporting spend on AI for cybersecurity to strengthen fraud detection and risk management. Foundational gaps, however, limit progress. Telemetry shows a median patch currency of 89% and a bottom-quartile SSL certificate validity of 85%, reflecting compatibility and security exposures that affect integration and scaling. Technical debt hinders agility for 22% of respondents, and 25% of mission-critical infrastructure is at or near end-of-service. In healthcare, end-of-service exposure is reported at 18%, indicating modernisation needs within strict regulatory and operational environments.
Automation is linked to resilience and cost control. Higher levels correlate with faster recovery, fewer manual errors and greater scalability, and nearly a third of organisations report reduced costs from automation and optimisation during the past year. Benchmarking using an internal operational metric—automations per device per month—shows clear variation. In healthcare, top performers record significantly more automated interactions than the lowest quartile, pointing to potential efficiency gains through broader automation and more consistent execution.
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Cloud Strategies Under Geopolitical Pressure
Geopolitical and regulatory pressures are reshaping decisions on where data resides and how it is protected. Sixty-five percent of respondents say they have adjusted cloud strategies due to data sovereignty requirements, tariffs, supply chain challenges and wider instability. Reported responses include expanding encryption, reviewing data policies and, in some cases, repatriating data to internal infrastructure. Country of origin and regulatory alignment of cloud providers are growing evaluation factors, and three quarters express rising concern about geopolitical risks associated with global cloud environments.
At the same time, respondents report clear cloud benefits. On average, cloud spend has risen by more than 30% over the past year, and many say cloud investments enhance agility, ease regulatory adaptation and enable AI deployment more readily than alternatives. Yet cloud journeys are not always deliberate. Many leaders, including a high share of CEOs, indicate their cloud environment evolved by accident rather than design. A majority report unexpected costs, workloads moving back on-premises and inaccessible data on platforms never fully decommissioned. Within healthcare, 57% agree that their cloud environment emerged unintentionally, highlighting the need for intentional architecture and lifecycle management where data sensitivity and interoperability are central.
As organisations move toward hybrid, workload-centric and cloud-native models, the priority is achieving flexibility without compromising compliance. Challenges persist. Regulatory and compliance constraints sit alongside environment complexity as the most common barriers to scaling technology investment. These pressures influence decisions on data placement, security controls and cross-platform operations in increasingly fragmented global conditions.
Culture, Skills and Scaling AI
Technology advancements are outpacing workforce readiness. Eighty-seven percent of leaders believe AI will transform roles within 12 months, yet only 29% say their workforce is currently prepared to use AI effectively. Weekly usage varies across technical and non-technical staff, indicating untapped adoption potential. Skills concerns dominate: having the right technical expertise, developing core human capabilities and reskilling as roles evolve. Many leaders also express uncertainty about identifying and addressing skills gaps, and a significant share are not confident they understand future requirements.
Culture is identified as an enabler or constraint. Nearly half of CEOs say culture slows innovation and decision-making. Respondents who report adaptable cultures also note higher IT readiness, more frequent weekly AI use among technical teams, stronger ability to scale beyond pilots and more consistent positive returns on AI and cloud initiatives. Pressure to demonstrate outcomes is rising, with 61% feeling more pressure than a year ago to prove AI return on investment, and over seven in ten reporting more pilots than they can realistically scale. Foundational technology limitations are cited as delaying innovation, underscoring the link between systems readiness, operating models and talent development.
Investment continues to expand beyond early generative use cases. AI remains a focus for cybersecurity and enterprise functions, and overall AI investment has increased by 33% in the past year. However, nearly two in three respondents do not consider their AI implementation fully ready to manage future risks, and most describe themselves as still experimenting. Integration challenges are frequently cited as a barrier to achieving positive returns, reinforcing the importance of platform compatibility and data readiness.
Across sectors including healthcare, respondents report investment momentum coupled with structural constraints. Organisations are upgrading foundations, adjusting cloud strategies under geopolitical pressure and focusing on cultural and skills alignment to keep pace with AI. Reported priorities include reducing end-of-service exposure, raising automation coverage, strengthening patch and certificate management and approaching cloud through deliberate design. In parallel, leaders seek adaptable cultures and clear pathways from pilots to scale, recognising that integration, governance and talent shape outcomes as much as technology. These measures position technology and clinical leaders to translate disruption into operational and patient-centred improvement.
Source: Kyndryl
Image Credit: iStock
