As 2025 approaches, technology leaders are faced with a pressing question: “Where is the return on investment for existing IT spending?” Businesses have invested heavily in cloud, SaaS, and AI solutions in recent years, but many still struggle to realize their full potential. This challenge is prompting a more deliberate approach to budgeting, focused on cost efficiency and maximizing the value of past investments.
Despite this caution, optimism persists. According to Forrester research, 91% of global technology decision makers plan to increase IT spending, and more than half expect growth to exceed 5% and outpace inflation. Forrester predicts the digital economy will grow at a 6.9% CAGR from 2023 to 2028, and enthusiasm for AI remains strong, albeit tempered by the shift to practical delivery. Naturally, these increases come with high expectations for increased operational value. The focus now should be on enhancing the capabilities of existing technologies through improved adoption, integration, and optimization. This situation highlights the urgent need for high-performance IT. It is a strategy that advocates a balanced approach to investing, divestitures and innovation, with a focus on continuously improving performance through technology.
To help technology leaders navigate these challenges, here are three predictions of what to expect for technology leaders in 2025.
Only one in five technology executives working on digital transformation will be successful. Many companies are undertaking large-scale transformation, but the progress is very slow. Financial results from services giants like Accenture and Capgemini show that while large deal bookings are on the rise, many digital transformations are stalled due to the complexity of coordinating with business, operations, HR and IT leaders. It is shown that there is. Successful technology leaders must work closely with business colleagues, quickly adapt to changing market dynamics, and consider turning to co-innovation partners to improve value orchestration. 70% of IT organizations mistakenly turn away from early career development. Demand for highly specialized software developers with AI experience has skyrocketed, creating a fragmentation of the workforce. Entry-level positions are decreasing, reducing opportunities for early career developers and mid-level managers. Over time, this becomes a recipe for disaster, as this trend threatens the talent pipeline that is essential to building high-performing organizations. Technology executives must focus on building organizations with continuous skills and career development, rather than relying on the market for readily available talent. Following disappointment with generative AI, 25% of tech executives plan to make employee experience the killer app. Generative AI can improve labor productivity only if companies redefine workflows and drive near-universal adoption. Successful technology executives prioritize tools that make employees’ lives easier, starting with tools that are under their control, like GitHub Copilot and chatbot IT helpdesks. These have expanded to include the deployment of Microsoft 365 Copilot, ensuring new tools fit seamlessly into employee work processes through human-centered design practices.
Forrester clients can read the entire Predictions 2025: Technology Leadership report to learn more about each of these predictions, as well as two bonus predictions. Set up a Forrester guidance session to discuss these predictions and plan your 2025 technology strategy.
If you’re not already a Forrester client, you can learn how to put these predictions into practice in a live webinar. You can also download our free forecast guide covering the key technology and security forecasts for 2025. Get additional free resources, including webinars, on our Predictions 2025 hub.
