As 2025 approaches, technology leaders face a pressing question: “Where’s the return on investment for our existing IT spend?” Over recent years, companies have heavily invested in cloud, SaaS, and AI solutions, yet many are still struggling to capture their full potential. This challenge is fueling a more cautious approach to budgeting, with a focus on cost efficiency and maximizing the value of past investments.

Despite this caution, optimism persists: According to a Forrester survey, 91% of global technology decision-makers plan to increase IT spending, with over half expecting growth to surpass 5% — outpacing inflation. Forrester forecasts that the digital economy will grow at a 6.9% CAGR from 2023 to 2028, and AI enthusiasm remains strong, albeit tempered by a shift to pragmatic delivery. Naturally, these increases come with high expectations for enhanced operational value. The emphasis should be made now to make existing technologies work harder through improved adoption, integration, and optimization. This climate underscores the urgent need for high-performance IT — a strategy that focuses on continuously improving business results though technology and advocates for a balanced approach to investments, divestments, and innovations.

To help tech leaders navigate these challenges, here is a look at three of the predictions that we think show what is in store for technology leaders in 2025:

  • Only one in five tech execs on the hook for digital transformation will succeed. Many companies are committing to large-scale transformations, but delivery is painfully slow. Financial results from service giants like Accenture and Capgemini show that bookings for large deals are up, yet many digital transformations stall due to the complexity of coordinating with business, operations, HR, and IT leaders. Successful tech leaders will need to align closely with business peers, adapt quickly to changing market dynamics, and consider switching to co-innovation partners for better value orchestration.
  • Seventy percent of IT organizations will incorrectly turn their back on early career development. The demand for highly specialized software developers with AI experience has surged, creating a split in the workforce. Entry-level positions have dwindled, reducing opportunities for early-career developers and midlevel managers. Over time, this is a recipe for disaster, as this trend threatens the talent pipeline critical for building a high-performing delivery organization. Tech executives need to focus more on building an organization with continuous skills and career development, rather than relying on the market to have readily available talent.
  • In the wake of generative AI disappointments, 25% of tech execs will make employee experience the killer app. Generative AI will improve labor productivity only after firms redefine workflows and drive near-universal adoption. Successful tech execs will prioritize tools that make employees’ lives easier, starting with those under their control, like GitHub Copilot and chatbot IT helpdesks. They will expand to include Microsoft 365 Copilot deployments, ensuring that new tools fit seamlessly into employees’ work processes through human-centered design practices.

Forrester clients can read our full Predictions 2025: Tech Leadership report to get more detail about each of these predictions, plus two more bonus predictions. Set up a Forrester guidance session to discuss these predictions or plan out your 2025 technology strategy.

If you aren’t yet a Forrester client, you can learn how to put these predictions into action during our live webinar. You can also download our complimentary Predictions guide, which covers our top technology and security predictions for 2025. Get additional complimentary resources, including webinars, on the Predictions 2025 hub.