Hitting the reset button on tech investment

The ‘factory settings’ for business have fundamentally changed in 2024. Board directors and business leaders must re-evaluate everything as 2025 approaches. But how?

EY teams recently asked 1,200 CEOs in 60 countries what disruptive forces would drive the most change in the next 12 months. And no surprise, 38% nominated emerging technology.

Tech disruption beat geopolitical instability, changing customer expectations, supply chain pressures, the elevated cost of capital, sustainability and climate change, new regulation,37% and access to talent.

But how can board leaders tackle technological disruption if they lack confidence in their tech capabilities? That’s one of the big questions we ask – and answer – as part of the EY Technology Governance Program.

Australian boards must upskill – and fast

EY research teams have found that just 37% of Australian non-executive directors possess tech experience, trailing their counterparts in the US (67%) and the UK (42%). The EY Technology Governance Program will spend the next six months working with board leaders to build their own tech fluency; they will bridge the gap with an immersive approach to new technologies.

The factory settings have shifted

The old rules and foundational assumptions of business no longer apply. Default approaches to problem-solving, customer engagement, decision-making, and even innovation have shifted.

Technology has democratised innovation – whether that’s coding or composition, design or diagnosis, the possibilities are now limitless. With the world’s knowledge and patents at our fingertips, we can pose countless questions until we find the right answers. This unprecedented accessibility is a superpower alongside significant risks.

Board leaders confront a critical question: “Was our organisation built for the era of AI or the industrial era? As the factory settings shift, am I?”

The markers of disruption are different

Disruption looks different from what it did even a year ago. Think of the AI-enabled content creation that has flooded our feeds in 2024, the virtual influencers taking over social media and the eye-watering investments in AI tools.

Want hard facts? Consider these signs of the times: Australia’s Olympic swimming relay teams were chosen by an AI coach. Nearly two-thirds of Australians now use GenAI daily. And a digital assistant saves EY people 14 hours a week.

New technology brings new problems

AI introduces new challenges across ethics, governance, employment, sustainability and more, all of which demand careful oversight as we balance innovation with responsibility. Here’s just one signpost on the road ahead: energy efficiency gains have been outpaced by the growth in AI computing, while a single prompt can use gallons of water. Board leaders must lean in to think carefully about how technology is changing the world.

Don’t underestimate AI impact

Businesses are growing sceptical of AI’s returns, having overestimated its short-term potential. But they’re also vastly underestimating its long-term impact. In time, AI will be as integral to computing as bank cards and electronic payments are to finance – everyday, essential and unremarkable. Businesses must be AI-ready.

Resistance to change is real

EY research teams have found Australians are warming to the idea of having AI in their lives, particularly Gen Z Australians (64%) and Millennials (66%), while Baby Boomers (38%) and the Silent Generation (33%) are less comfortable. But they have legitimate concerns about data protection and security and want to know AI is being built inclusively to benefit everyone.

The message here is clear: don’t push people too hard, too quickly. History shows that resistance fades with time. People protested telephones as the ‘devil’s instrument’, bank cards for fear of losing their cheque books, and Wi-Fi for invading their personal space.

Re-evaluate everything

We are in what the Institute for the Future calls the “decisive decade”. That means we must re-evaluate everything. And I mean everything – customer service, employee value proposition, security, sustainability and business operating model.

Most organisations continue to replicate business models that have been in play for two centuries. Rather than improving operations for a business built 10, 50 or 100 years ago, the EY Technology Governance Program encourages participants to “engineer” their approach to the future by fostering foresight, embracing exposure to new technology, and cultivating curiosity. This empowers them to innovate for the future, not for the past.

Scan the horizon

How do leaders get a ‘live feed’ on sentiment – whether that’s from employees, customers or the community – when everything is moving so quickly in the age of AI? The secret is to keep one eye on current sentiment and the other on emerging signals of shifting markets and societal moods.

If your organisation is being disrupted by technology rather than driven by purpose, then the tail is wagging the dog. Board directors with foresight aren’t merely reacting to market forces or regulatory pressures; they are proactively choosing self-disruption to pull the timeline forward.

Lead the change; don’t chase it

The pace of change will accelerate in 2025. Speaking recently at the CEDA AI Leadership Summit, IBM’s VP of Government and Regulatory Affairs Christina Montgomery said it well: “Today will be the slowest day in tech for the rest of our lives.”

Here’s my big, bold prediction: 2025 will be the “Year of Unlock.” We will transition from experimentation to unlocking solutions at scale, resolving challenges that have long remained unsolved. Humanity will achieve remarkable feats, uncovering possibilities we never imagined. That’s what’s ahead for the leaders who proactively pull the future forward.

This is the first instalment of a series of short articles complementing the 2025 EY Technology Governance Program. Read the articles from our last series authored by my series co-host, @Jenny Young , and reach out to talk to me about Tech Governance for your organisation.

The views expressed in this article are the views of the author, not Ernst & Young. This article provides general information, does not constitute advice and should not be relied on as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Liability limited by a scheme approved under Professional Standards Legislation.