CIO Survey Shows 3.8% Increase to Software Budgets in 2026: Morgan Stanley

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CIOs forecast a 3.8% rise in software budgets for 2026, with Microsoft leading the market. The previous year's expectation was 3.7%. Microsoft maintains high growth prospects, with 92% of CIOs planning to adopt its AI products. Microsoft Azure is the preferred cloud platform, hosting 53% of application workloads. Despite a decline in expected use of Azure's OpenAI services, Microsoft dominates enterprise AI spending, followed by Amazon and others. Morgan Stanley rates Microsoft as a “top pick” with a $650 price target.

https://seekingalpha.com/news/4539216-cio-survey-shows-3_8-percent-increase-to-software-budgets-in-2026-morgan-stanley

8 CIO Recommendations for ERP Implementation in 2026

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Agentic AI is transforming ERP systems, enabling new operating models and improving agility, efficiency, and customer responsiveness. By 2026, CIOs should develop a business plan for agentic AI adoption, engage with ERP vendors, and define a human-AI collaboration strategy. They must also address risks, readiness gaps, and talent needs while planning for change management and communication strategies.

https://www.informationweek.com/software-platforms/8-cio-recommendations-for-erp-implementation-in-2026-think-agentic

New Skills and AI Are Reshaping the Future of Work

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AI and new skills are transforming job markets. While some roles disappear, new opportunities arise, emphasizing the need for skills updates. Nearly 40% of jobs face AI disruption, raising concerns over job loss. Higher demand for new skills leads to wage increases but negatively impacts entry-level jobs. Policymakers must prepare workers for future labor markets by enhancing education, mobility, and innovation. Successful adaptation relies on investments in skills and competitive markets to ensure AI benefits are widely shared.

https://www.imf.org/en/blogs/articles/2026/01/14/new-skills-and-ai-are-reshaping-the-future-of-work

Designing Safer Links: Secure Connectivity for Operational Technology

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New guidance outlines eight core principles for designing, reviewing, and securing connectivity to and within OT systems. These principles, developed from the NCSC’s experience and industry engagement, aim to help organizations reduce attack surfaces and improve incident response. The guidance encourages OT owners, operators, integrators, and vendors to implement these principles for stronger connectivity design.

https://www.ncsc.gov.uk/blog-post/designing-safer-links-secure-connectivity-for-ot

Managing Risk Has Been a Priority Ever Since You Asked About It

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The CISO Series Podcast, recorded live at FAIRCON25 in NYC, discusses the challenges of starting risk management from scratch and the need to modernize GRC systems. The conversation highlights the importance of focusing on risk rather than just compliance, and the potential pitfalls of relying solely on AI-powered tools for risk quantification. The discussion also touches on the accountability of AI agents and the need for clear ownership and governance when they make mistakes.

https://cisoseries.com/managing-risk-has-been-a-priority-ever-since-you-asked-about-it/

How Microsoft Builds Privacy and Security to Work Hand-in-hand

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Microsoft Security focuses on integrating security and privacy. Emphasizing trust, compliance, and customer data ownership, Microsoft employs technologies like Microsoft Entra and Purview to protect data efficiently without accessing it directly. They aim for seamless security through continuous authentication and strong regulatory adherence, viewing compliance as a chance for innovative enhancement. Microsoft prioritizes privacy as a fundamental right while ensuring security measures deepen customer trust.

https://www.microsoft.com/en-us/security/blog/2026/01/13/how-microsoft-builds-privacy-and-security-to-work-hand-in-hand/

DDoS in 2025: What a Difference a Year Makes

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DDoS attacks in 2025 have escalated, evolving to terabit-scale occurrences that target networks daily, driven by more sophisticated, automated tactics. Detection and response systems struggle to keep pace, with attacks now often concluding in under two minutes. Previously common IoT botnets are being replaced by large residential proxy networks utilizing billions of home devices for attacks, greatly increasing potential bandwidth. To combat this, defenses must shift to automation and real-time intelligence, moving to proactive rather than reactive strategies.

https://www.techradar.com/pro/ddos-in-2025-what-a-difference-a-year-makes

The Economics of Skills: AI, Human Augmentation, and the Future Workforce

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HR faces challenges due to digital transformation, wage inflation, and a shift in global tech talent from the Global North to decentralized regions. Key metrics are changing from FTE counts to Effective Digital Capacity (EDC). By 2027, 40% of tech skills may become obsolete due to AI. Emerging Tier-2 cities are gaining importance as competitive tech hubs, while significant supply-demand gaps exist in software development and cybersecurity roles. The half-life of tech skills is under two years, emphasizing skill adaptation. Companies must transition to a strategic focus on skills, with an urgency for Builders in the workforce, as traditional labor cost advantages diminish. Competitive advantage will rely on capability, innovation, and skill-based compensation systems.

https://draup.com/talent/data-books/economics-of-skills-ai-augmentation

CISOs’ Top 10 Cybersecurity Priorities for 2026

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CISOs' 2026 cybersecurity priorities focus on AI threats, data protection, resiliency, third-party risk, and geopolitical risks. Core tasks include securing AI deployments, enhancing threat intelligence, and managing identity access due to the rise of AI. CISOs aim to address shadow AI risks, improve third-party management, and ensure resilience across operations. Global events heighten attention on geopolitical risks impacting cybersecurity strategies.

https://www.csoonline.com/article/4114020/cisos-top-10-cybersecurity-priorities-for-2026.html

7 Challenges IT Leaders Will Face in 2026

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CIOs face 7 key challenges in 2026: talent shortages, AI integration, governance, people alignment, cost management, cybersecurity risks, and rising demands. They must train staff, create cohesive AI strategies, build governance frameworks, and foster a culture of continuous learning. Balancing costs with innovation and addressing sophisticated cyber threats are critical, as is preparing the workforce for rapid tech changes. Ultimately, effective CIOs will lead cultural and operational transformations leveraging AI for a more agile organization.

https://www.cio.com/article/4114004/7-challenges-it-leaders-will-face-in-2026.html

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