Exclusive: Why automation & AI are now vital for Australian resilience

Australian businesses are facing a reckoning in digital operations, as both consumer trust and productivity are undermined by repeated IT outages and mounting cybersecurity pressures.

Recent industry data paints a stark picture: over 73 million work hours have been lost to outages in the past year, and consumer trust has dropped by up to 29% across major sectors.

Financial regulators have responded with a sweeping new mandate, APRA's CPS 230, aimed at systemic risk in the sector and requiring institutions to overhaul their operational risk regimes before July 2025. But the impact of these pressures - and the lessons of resilience - are rapidly spreading beyond finance, reshaping approaches to digital trust across retail, telecommunications, and airlines.

Against this backdrop, emerging technologies such as automation and Agentic AI are moving from boardroom aspirations to operational necessities.

TechDay sat down with PagerDuty to discuss their global State of Digital Operations 2025 report.

"We're seeing cost pressures harden across the APAC region," explained Ross Martin, Regional Enterprise Director, APAC.

"Every company is being asked to do more with less, and headcount remains the major drain on expenditure. Automation isn't about replacing people - it's about augmenting teams so talent can focus on problems that truly impact the bottom line and customer experience."

Australian respondents are at the vanguard: 65% identify automation as their lever for improved operational effectiveness, and 46% regard Agentic AI as central to the future of IT operations.

Yet the region's drive towards automation is as much about necessity as strategy. As Martin noted, "Skill shortages are a significant challenge. Enterprises can't hire fast enough to match business tempo, and there simply aren't enough specialists to build and maintain processes manually at scale. Automation and AI have become crucial for scaling to meet both executive and customer expectations."

But while the appetite for automation grows, so do anxieties around data security, cited by 33% of local IT leaders as their most critical hurdle.

David Ridge, Head of Solutions Consulting APJ at PagerDuty, explained: "As organisations push more digital services online, their threat surface area increases, and the data they protect becomes more exposed. It's essential not to innovate so quickly that you compromise security."

Ridge said the key is operationalising security as a real-time discipline, aligning it with the rapid incident response cycles that digital-native companies now require.

"Security teams now face the same pressure as operations. Real-time monitoring and response - rather than periodic reviews - has become best practice," he said.

"PagerDuty sits within that architecture by ensuring security teams have the insight and automation needed to detect and respond to live threats, but also by embedding context and enrichment into incident data so humans don't waste critical time chasing incomplete information."

Navigating the tension between rapid innovation and robust risk management is a new balancing act for Australian technology leaders.

"Security used to be the brake on innovation, but we're seeing it evolve into an enabler," said Martin. "With cloud and AI, the risk isn't only internal. Data crosses borders seamlessly. Companies must innovate, but at a safe, well-governed pace. The regulators - notably APRA with CPS 230 - are making sure that's non-negotiable."

With compliance deadlines imminent, CPS 230 has shifted the national conversation from simple reliability to operational resilience. Ridge pointed out: "CPS 230 is pushing financial services to go beyond just having a plan.

"It's about documented controls, knowing your critical systems, and being able to demonstrate - with evidence - how you'll respond when incidents happen. It marks a real shift from assuming outages are preventable, to demanding resilience and rehearsed responses are built in."

While these standards are mandatory for banks and insurers, Martin noted a knock-on effect across industries: telecommunications, retail, and airlines are proactively adopting similar frameworks.

"It's no longer just about ticking the compliance box - there's a clear recognition that consumer trust is now a market differentiator. The sector learning curve is being flattened by these shared principles of resilience."

As Agentic AI begins to shape workflows, the implementation strategy is critical. Ridge described a tiered approach: "We break down real-time operations into three categories - well-understood tasks, partially understood, and the new-and-novel.

"The best place to start integrating Agentic AI is with the well-understood. It's where automation is safest and quickest to scale. As AI proves its value there, companies build confidence and can gradually address the more ambiguous cases, always keeping a human in the loop to make final decisions."

Despite strong interest, operations use cases for Agentic AI are still advancing cautiously in Australia.

"There's high uptake in customer service, especially in traditional Business Process Outsourcing (BPO) environments where AI is starting to disrupt low-cost contact centre models. In engineering, Agentic AI tools are being used for peer code reviews and development lifecycle acceleration," said Martin. "But for operations, where the stakes are high and outages can mean millions lost - as with one banking client reporting over AUD $15 million in annual call-out costs - companies want assurances and rigorous controls before ceding too much agency to AI."

The skills gap in automation and AI is seen as a pressing amplifier for both business opportunity and risk.

Martin highlighted PagerDuty's approach: "We advise customers to leverage proven, pre-built assets where possible. Instead of building every automation from scratch, clients can tap into our library and get a significant operational head start without needing deep, specialised engineering teams." Partnerships with universities and graduate pathways are also addressing longer-term needs.

The strategic divergence between executives and practitioners is more pronounced with AI than almost any other technology, Ridge observed.

"Executives see AI as an engine for market differentiation and faster innovation. Practitioners, in contrast, are focused on capacity, reducing toil, and reliability. The excitement from the top can sometimes outpace readiness on the ground, especially given the evolving complexity of tools like generative AI."

This complexity is why trust - both in data and in automation outcomes - is emerging as the market's critical success factor.

"Customers must trust not just the AI, but the quality of their own data," said Ridge. "AI is only as good as the data it consumes. Organisations with richer, more reliable operational data will get more out of automation, but that trust must be earned and validated."

The last word, in Martin's view, is anchored in resilience: "Incidents are inevitable, even in the best-run organisations.

"What CPS 230 and similar standards are doing is making accountability and preparedness part of the operational fabric - you need to show not that you're immune from incidents, but that you're ready, controlled, and able to respond when, not if, disruption comes."