For most public sector organizations, digital transformation is a work in progress, with the complexity of integrating new systems and privacy and security concerns remaining key barriers, according to a report by SolarWinds.
Only 6% of respondents report having fully completed their digital transformation journey, while most indicate they are somewhere along the journey, with efforts either well underway (41%) or beginning implementation in some areas with limited progress (42%).
“As the public sector navigates the evolving technology landscape, more organizations will continue to redirect operations and workloads to the cloud and adopt hybrid IT solutions,” said Travis Galloway, Senior Advisor, Government Affairs at SolarWinds.
“This adds another layer of complexity to data security and compliance across operations, along with the added pressures of budget constraints,” Galloway continued.
The most pressing security challenges today include vulnerabilities in monitoring systems and the critical need to safeguard sensitive information from cyber threats. Participants ranked the general hacking community (59%) and careless/untrained insiders (58%) as their top-ranked security threats, emphasizing the need for stronger security awareness training, enhanced tools, and better access control mechanisms.
AI adoption is also gaining momentum, with benefits like predictive analytics and issue detection, but concerns still linger. Over 33% of respondents leverage AI to automate cybersecurity operations and enhance IT observability, with many more planning to adopt it soon.
Despite this, approximately 4 in 10 respondents are extremely or very concerned about potential risks associated with adopting AI, such as data privacy and compliance, making full-scale implementation a cautious process.
Status of digital transformation in the public sector
Data privacy and security concerns (62%), budget constraints (57%), and the complexity of integration (56%) are the top challenges in respondents’ digital transformation journey. Notably, education-sector respondents are more likely to cite the complexity of integration as a challenge.
Improving the observability of systems and processes and advancing digital transformation are high or very high priorities for over half of the respondents. In contrast, integrating AI into operations is regarded as a lower priority.
Budget constraints (28%) top this year’s list of significant obstacles to maintaining or improving IT security. Closely following is the complexity of the internal environment (20%).
The primary sources of security threats for the SLED (state, local, and education) audience have remained relatively consistent since 2019. However, in 2024, the education audience saw a shift, with the general hacking community surpassing careless/untrained insiders as the leading source of threats.
Current and future environments
In 2024, government (private) cloud has taken the lead as the most prevalent environment (70%), driven by a decline in traditional on-premises data center usage (58%), which was the most common in 2023 (91%). Consistent with last year, respondents continue to anticipate that hybrid environments will be the most common in the future (48%).
Over half of respondents report their IT environment is extremely or very complex to manage, though this has decreased compared to last year. Additionally, less than half feel extremely or very confident in their ability to manage it effectively.
Hybrid IT infrastructure challenges
The complexity of managing hybrid environments is the top challenge (73%), especially for federal respondents. Security issues (67%), issues with legacy system integration (55%), and cost concerns (51%) are also challenges for the majority of participants.
When considering both overall rankings and being ranked as the top priority, data protection and privacy concerns, along with safeguarding sensitive information from cyber threats, emerge as the leading security challenges in a hybrid IT infrastructure at 51%.
63% of respondents face challenges with monitoring across multiple environments, hindering their ability to gain visibility into their organization’s hybrid IT infrastructure.