AI and cybersecurity are investment priorities

AI Investment: AI taking center stage.

AI usage among IT service providers continues to increase with most respondents prioritizing investing in AI to increase overall efficiency. Forty percent of survey respondents expect AI usage to be the primary budget driver in 2024, suggesting a significant shift in budget allocation towards AI-driven initiatives.

Businesses are increasingly prioritizing AI investments, such as IT automation and AI and machine learning, which rank among the top five technologies that IT service providers say they plan to pursue. In fact, 37% of respondents are considering investing in AI and machine learning, compared to 20% the year prior. Three out of four see AI as beneficial for their business, while only 3% doubt its impact, highlighting optimism about AI’s potential to transform operations.

According to the survey findings, there is also a rising trend in the utilization of AI technologies to enhance IT efficiency by 41% and end-user productivity by 40%, demonstrating the increasing reliance on AI to drive operational improvements and employee performance.

Cybersecurity remains a priority.

Along with AI, cybersecurity remains a primary concern, with 43% of respondents citing it as the foremost challenge for IT departments. Based on the survey, 45% of IT service providers consider cybersecurity the top area to add or change solutions in the next budget cycle. This includes investments in security awareness training (45%), email security (43%), penetration testing (36%) and vulnerability scanning (35%). The cybersecurity investments by IT service providers underscore their proactive approach to identifying and mitigating vulnerabilities.

Half of the respondents prioritize increasing their budget for IT security over other areas, such as AI for IT efficiency and end-user productivity, demonstrating the critical importance placed on ensuring robust cybersecurity measures within organizations.

Focus on automation and completeness.

Consistent data from 2023 to 2024 shows that businesses value the efficiency and productivity of tools, stressing the completeness of solutions. Specifically, 42% of respondents advocate prioritizing the efficiency of IT processes, a trend that has been steadily increasing over the past three years.

Moreover, emphasis was placed on the completeness of solutions, with almost half of the respondents (42%) indicating a strong preference for all-in-one solutions that can manage multiple tasks and processes without requiring multiple tools, and 21% saying they prioritize access to comprehensive IT documentation, reflecting the need for centralized and easily accessible information.

The focus on deep integration tools was down sharply from years past, suggesting that companies may have reached a satisfactory integration level or are adopting more comprehensive solutions that require less integration effort.

Economic Concerns and Shorter Vendor Contracts

Most respondents expect that ongoing economic uncertainty will primarily affect spending on software (39%), hardware (36%), and headcount (26%).

Furthermore, 40% of respondents have displayed a growing inclination toward shorter contract periods with vendors. This shift might stem from volatile economic conditions, where shorter, more adaptable contracts may mitigate long-term risks. Additionally, this shift suggests a desire for greater control and agility in responding to emerging challenges and opportunities.