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When it comes to tech spending in 2023, there's one top priority

According to Red Hat's 2023 Tech Outlook report, there's a clear leader when it comes to investment plans.
Written by Owen Hughes, Senior Editor on
Business people dressed casual/corporate, talking together in large glass conference room
Image: Klaus Vedfelt/ Getty Images

Companies are putting security at the front and center of their spending priorities over the next 12 months, according to Red Hat's 2023 Global Tech Outlook report, with cybersecurity now taking precedence over innovation.

Red Hat surveyed 1,703 IT leaders to in an effort to discover where organizations are on their digital transformation journeys, funding priorities and the challenges faced.

It found that investment in IT security was "by far" the most common overall funding priority during the next 12 months, with 44% of respondents placing it in their top three priorities alongside cloud infrastructure (36%) and IT/cloud management (35%).

Security was cited as a priority across a variety of technology categories, including cloud infrastructure (42%), big data and analytics (45%), and automation (35%).

Additionally, more organizations are prioritizing cybersecurity as part of their digital transformation efforts, Red Hat found: 20% of IT leaders said security took precedence, compared to 19% who said innovation. In 2021, 24% of IT leaders said innovation was the focus of their digital transformation initiatives, while just 17% cited IT security. 

SEE: Cybersecurity, cloud and coding: Why these three skills will lead demand in 2023

Red Hat's report reflects a greater focus on cybersecurity from companies following explosive growth in cloud deployments over the past two years and a large-scale shift to remote working, both of which have introduced new security risks to corporate networks.

But while security is rightly high on leaders' minds, culture appears to have taken a backseat.

In fact, culture was the lowest-ranked priority in IT leaders' digitization agendas, and was cited by just 7% of respondents (vs 6% in 2021). Red Hat said this was somewhat disappointing given its overall importance and noted that people and culture played an important role in digital transformation.

This sentiment was reflected in IT leaders' non-IT spending priorities: when asked where their funding ambitions lay outside of products and solutions, 37% of respondents cited digital transformation strategy, tying with technology skills training (also 37%). Rounding out the top five were people and process skills training (30%), compliance (28%), and IT/developer hiring and retention (28%).

"In other words, the top five non-IT funding priorities are all about people to at least some degree," said Red Hat. "Only hiring security and compliance staff among security funding priorities is a somewhat puzzling low-priority outlier as we've seen."

When it came to exploring where organizations are on their digital transformation journeys, Red Hat saw little change from 2021: 12% said they were "leading", 23% said they were "accelerating", 31% said they were "transforming", and 18% said they were "emerging".

However, 6% of respondents admitted to being "stalled" – doubling the 2021 figure of 3%. IT leaders put this down to a variety of reasons, including financial and hiring struggles.

Likewise, 6% of IT leaders said they had not yet started – or were otherwise just beginning – their digital transformation journeys, while 3% had no plans to digitally transform whatsoever.

Reassuringly, lower-level technology staff appear to be having more influence in organizations' IT decisions.

While C-level executive (92%), vice president (78%) and director roles (74%) continue to be the ultimate decision makers in tech purchases, 38% identified developers as key decision makers. Red Hat noted that, "while lower than the management roles, this is still a large minority."

Also: IT leaders aren't getting listened to, and now they're ready to walk away

An even larger proportion of developers are key decision influencers – 62%– more so than company presidents (8%), vice presidents (22%), directors (27%), and managers (48%).

"While the data does not support a thesis that IT decision-making authority in organizations has mostly devolved to developers, it does support the idea that developers at least see themselves as having increased authority," said Red Hat.

Red Hat's ninth annual Global Tech outlook report was conducted across a range of industries worldwide and can be found here.

Respondents comprised a subset of Red Hat customers together with others drawn from a broad industry panel. 

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