Artificial Intelligence (AI) and Cloud Transformation Dominate IT Investment Priorities for 2024, According to the New Rackspace Technology Survey, in Association with VMware
December 11 2023 - 8:12AM
New research by Rackspace Technology (NASDAQ: RXT), a leading
end-to-end, hybrid multicloud technology solutions company, in
association with VMware, finds that despite ongoing economic
uncertainty, businesses are committed to prioritizing their IT
investments in 2024, particularly in transformative technologies
such as artificial intelligence (AI) and cloud transformation.
According to the 2024 IT Outlook
Report, which surveyed 1,420 global IT
professionals, 63% of organizations plan to re-calibrate their
investments in 2024. Moreover, artificial intelligence dominates as
the top priority, with 65% of respondents identifying pervasive
artificial intelligence as the technology that will have the most
significant positive impact on their organization over the next 12
months. The survey also underscores the continued adoption of the
cloud. When asked about the makeup of their organization’s IT
infrastructure and how it will evolve over the next 12 months, edge
computing, private cloud, and public cloud increased as a
percentage of workloads, while data centers, colocation facilities,
and mainframes declined.
“These results highlight a decisive shift in artificial
intelligence from the technical curiosity and pilot programs in
2023 to accelerating business outcomes through the
industrialization of Responsible AI solutions in 2024,”
said Srini Koushik, President of Technology and Sustainability
at Rackspace Technology. “In the cloud arena, the increased focus
on the edge and private cloud indicate that organizations are
simultaneously migrating more of their critical workloads while
adopting a more sophisticated workload-aware approach to their
overall cloud infrastructure.”
AI Evolution As generative AI continues to
mature and grow in importance, 33% of organizations say they have
either completed prototypes and are taking projects into production
or already have projects underway and plan to expand them, while
another 66% of respondents are either currently ideating on the use
of generative AI or plan to do so. Just 1% of respondents have no
plans to use generative AI. Moreover, 67% of those surveyed say
they will have generative AI either integrated into some processes
or fully integrated into all processes in 12 months.
While many organizations are using AI primarily for “table
stakes” tasks such as sentiment analysis and code development, the
use cases where respondents see the greatest expected benefit
include security (54%), new product development (50%), increased
productivity (45%) and enhanced speed and efficiency in existing
work processes (42%).
At the same time, organizations report challenges in
implementing AI programs. 42% of survey participants acknowledge
demonstrating the value of AI as a hurdle, while insufficient
technological infrastructure support for AI was noted by 38%,
followed by a shortage of skilled IT talent, at 32%. Organizations
also continue to grapple with data governance policies and
strategies in response to AI. Less than half (46%) of organizations
have policies or strategies in place to address privacy concerns,
and only 42% say they have addressed data bias.
“While some organizations have already implemented AI-powered
solutions, many are still in the early stages, grappling with the
considerations and challenges associated with AI adoption,” added
Koushik. “They are not just contemplating but actively addressing
the issues associated with the widespread integration of AI into
their business processes and operations, marking a crucial phase in
their transformative journey."
Private Cloud, Edge Ascending The survey
highlights an ongoing evolution in companies’ cloud strategies as
workloads migrate away from within the organization’s walls. When
asked to compare their current infrastructure with their projected
infrastructure composition over the next three years, private cloud
rose by 4%, while public cloud saw a smaller increase, with
concurrent decreases observed in workloads running on other
servers, including mainframes and on-premises data centers. Edge
computing is also becoming a priority, with 30% of organizations
saying it will be part of their IT infrastructure makeup in 12
months, compared to 26% today. 75% of respondents say they are
employing a hybrid cloud strategy today.
Survey participants identified resource shortages and
security/compliance risks as their primary challenges in
transitioning to the cloud, at 34%. This was followed by concerns
such as cost overruns (33%), resistance to change (28%),
inappropriate cloud provider selection (24%), and a lack of
stakeholder buy-in (23%).
The Talent Search Dilemma As companies
prioritize AI and cloud, securing and retaining talent remains a
challenge, with respondents identifying a shortage of skilled
workers as their leading concern (69%). 47% of respondents also see
paying more to fill critical roles, with the rapid pace of
technology advancement cited as the leading cause for higher IT
labor costs.
“The sustained pace and magnitude of technology
advancements in AI, Cloud, Security, and other technologies demand
an adaptable workforce that embraces lifelong learning,” added
Koushik. “This challenge underscores the need for a different
workforce strategy that prioritizes adaptability, problem-solving,
and continuous learning in addition to the latest technical skills
to keep pace and drive innovation forward.”
Click here to review the comprehensive 2024 IT Outlook
Whitepaper and Infographic with the breakdown of survey
findings.
Survey Methodology The survey was conducted by
Coleman Parkes in October and November 2023 and targeted 1,420
senior IT decision makers across multiple key sectors in the USA,
LATAM, EMEA and APAC.
Coleman Parkes is a full-service B2B market research agency
specializing in IT/technology studies, targeting senior decision
makers in SMB to large and enterprises across multiple sectors
globally.
About Rackspace TechnologyRackspace
Technology is a leading end-to-end multicloud technology
services company. We can design, build and operate our customers’
cloud environments across all major technology platforms,
irrespective of technology stack or deployment model. We partner
with our customers at every stage of their cloud journey, enabling
them to modernize applications, build new products and adopt
innovative technologies.
About VMwareVMware is a leading provider of
multi-cloud services for all applications, enabling digital
innovation with enterprise control. As a trusted foundation to
accelerate innovation, VMware software gives businesses the
flexibility and choice they need to build the future. Headquartered
in Palo Alto, California, VMware is committed to building a better
future through the company’s 2030 Agenda. For more information,
please visit www.vmware.com/company.
Media Contact: Natalie Silva, publicrelations@rackspace.com
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