Enterprises Prep for Big AI Spending, But Data Woes Prevent Progress

Dive Brief:

• Enterprises are planning to spend an average of $35.5 million on modernizing their IT estates this year, with more than one-third going toward AI, according to a survey published Monday by cloud database company Couchbase. 
• Since 2023, businesses will have invested an average of $21 million in AI by the end of the year, according to the survey of 500 senior IT decision-makers. Generative AI specific investments during the period will average $6.7 million. 
• “The drivers for this are clear: rapidly prototyping and testing new ideas, making employees more efficient and identifying and capitalizing on new business trends,” Couchbase said in the report. “Yet enterprises recognize there are challenges ahead.”

Dive Insight:

With AI goals top of mind, tech leaders are clearing a path through tangled tech debt and siloed data, a process that can eat into IT budgets.

More than half of IT decision-makers worry about their organization’s ability to manage data without significant investment, according to Couchbase’s findings. 

Organizations across industries have committed to reworking their data pipelines, improving hygiene and revamping their workforce strategies in response to AI aspirations. Accenture laid out plans last year to invest $3 billion in its data and AI practice, intending to double its AI talent pool. 

Cushman & Wakefield’s Shawna Cartwright, business information officer and SVP of enterprise technology, previously told CIO Dive that teams spent “a lot of time” standardizing data across key spaces last year to ensure the real estate company can reach its AI targets. Data is also central to American Honda’s broader AI strategy.

“We’ve given data a promotion in the company… putting it on the same plane as our chief information security officer or our chief privacy officer,” Bob Brizendine, VP of IT at American Honda, said during a CIO Dive panel in March. 

More than 3 in 5 organizations executed plans to improve data operating models in response to AI’s disruption last year, Gartner research published in April found. More than one-third of chief data and analytics officers said they are prepping for an architecture overhaul in the next 12 to 18 months.

Generative AI interest has facilitated “gold rush level spending,” according to Gartner research. The analyst firm forecasts an 8% increase in IT spending this year, which includes significant cloud data center investments. Annual spending on technology will surpass $8 trillion by the end of the decade, the firm projects.

This article was written by Lindsey Wilkinson from CX Dive and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.