AI, cloud among top IT investment priorities for 2024, says study

Despite economic uncertainties, a survey by Rackspace Technology, in collaboration with Dell and VMware, reveals that businesses are gearing up to invest in IT in 2024, with a keen focus on artificial intelligence (AI) and cloud transformation.

The 2024 IT Outlook Report, based on responses from 1,420 global IT professionals, highlights that 63% of organizations plan to adjust their investments in the coming year. AI steals the spotlight, with 65% recognizing its potential for significant positive impact. Cloud adoption is also on the rise, with edge computing, private cloud, and public cloud gaining popularity.

Srini Koushik, President of Technology and Sustainability at Rackspace Technology, explains, “AI is moving from curiosity to delivering real business outcomes in 2024. In the cloud realm, the emphasis on edge and private cloud shows organizations are moving critical workloads with a smarter approach.”

AI Progress and Challenges

Generative AI is gaining traction, with 26% of Indian organizations already using it or planning to do so. The survey identifies expected benefits in security (49%), new product development (47%), increased productivity (39%), and efficiency gains (41%). Challenges include demonstrating AI value (44%), technological limitations (45%), and a shortage of skilled IT talent (29%).

Organizations also grapple with data governance, as only 41% have strategies for privacy concerns, and 38% have addressed data bias.

Koushik notes, “While some have implemented AI, many are in the early stages, addressing issues tied to widespread AI integration.”

Private Cloud and Edge Computing on the Rise

The survey signals a shift in cloud strategies, with private cloud growing by over 5%, and public cloud seeing a smaller increase. Edge computing is gaining importance, with 32% of organizations planning to include it in their IT infrastructure within a year. An overwhelming 87% already use a hybrid cloud strategy.

Challenges in transitioning to the cloud include security/compliance risks (37%) and resistance to change (35%). Concerns about resource shortages, cost overruns, inappropriate cloud provider selection, and a lack of stakeholder buy-in are also noted.

The Talent Challenge

As companies focus on AI and cloud, talent acquisition and retention prove challenging. Ensuring a positive work environment (46%) is a top concern, while 41% see opportunities for professional development. The rapid pace of tech advancement is cited as the leading cause for higher IT labor costs.

Koushik emphasizes the need for an adaptable workforce, stating, “The sustained pace of tech advancements demands a workforce that embraces lifelong learning, adaptability, and problem-solving."