Networking, security initiatives dominate IT spending priorities

Network connectivity and security are key areas for IT investment as well as potential barriers to global success, according to new research.

Nearly half of CIOs claim that establishing and managing connectivity in new markets is the single most critical factor when it comes to ensuring successful global expansion, according to Expereo, which surveyed 650 large enterprise and mid-market CIOs across Asia, Europe and North America for its research. In addition, 49% of CIOs report that their board views global connectivity as “a business-critical asset to growth.”

Yet challenges remain. The most prevalent connectivity concerns that CIOs say they’re dealing with are network performance issues (cited by 37% of respondents), expanding connectivity into new markets (37%), and the constraints of legacy platforms (35%).

“Businesses must be able to anticipate change and flex, scale, and adapt faster than ever. How? By transforming into cloud-first, data-driven, digital enterprises,” said Ben Elms, chief revenue officer at Expereo, in the network service provider’s Enterprise Horizons report. “This requires a network that is not only optimized for success today, but one that’s future-ready, too—a network capable of keeping up with evolving demands.”

Driving demand for more flexible, scalable IP networks is the fact that the nature of work has changed. Existing workers and new hires expect to be able to work from home, and “the effort to support remote workers with similar levels of security and performance as they would experience if working in the office complicates CIOs’ connectivity challenges,” the report states.

Global expansion, too, is a top business priority that’s driving demand for reliable, secure network connectivity.

IT budget growth and spending priorities

In the big picture, CIOs remain optimistic about future growth despite ongoing economic uncertainty. More than half (56%) of the global CIOs surveyed have successfully secured increased technology budgets in 2023, according to Expereo’s research. The study also found that 32% of respondents describe their organizations’ attitude for the next 12 months as “ambitious,” while another 29% identify as “optimistic” for the coming year.

In terms of budget priorities, networking and security initiatives dominate the list of investments that CIOs have earmarked for increased spending. According to the research, CIOs will focus on:

• Security (cited by 44%)
• 5G (42%)
• AI/ML (41%)
• Automation and analytics (40%)
• Internet of Things (38%)
• Public/hybrid cloud (38%)
• Edge computing (37%)
• SaaS (36%)
• SASE (33%)
• WAN (32%)
• MPLS VPN (30%)
• SD-WAN (26%)

Plans to invest in internal talent

The changing nature of work is also driving CIOs to invest in existing talent as skills shortages continue to plague the IT industry. With 49% of businesses struggling to find cybersecurity experts and 41% having trouble filling artificial intelligence (AI) and machine learning (ML) roles, CIOs are turning to their own talent to close the skills gap.

According to the Enterprise Horizons report, 46% of surveyed CIOs said they are upskilling teams, and 46% said they are increasing AI and automation to deliver the talent resources needed for business growth. Other approaches to help with talent resources include outsourcing system management (38%), increasing recruitment efforts (36%), and reassigning resources (34%). Unfortunately, deprioritizing projects (28%) and cutting headcount (23%) are the reality for some CIOs.

The changing workforce does offer CIOs access to a more global workforce of remote employees. The survey found 43% have expanded hiring options, while 38% manage a team which is scattered across markets.

“The competition for talent is real. There are few skilled experts for key new technologies, and they are in high demand,” the report states. “CIOs are using internal upskilling for critical needs.”