C-Suite Leaders Pour IT Budgets Into Modernization, But Success Hinges on Strategy
Digital transformation has become the buzzword of the decade, but for many enterprises, turning big investments into real returns remains tricky. A new global study commissioned by Rocket Software and conducted by IDC shows that while executives are eager to modernize their IT systems — with up to 30% of budgets earmarked for it — most organizations are still struggling to achieve the results they want.
From cybersecurity threats to talent shortages, the road to modernization is riddled with challenges. For Filipino businesses looking to stay competitive in a digital-first world, the study offers valuable insights on how to future-proof operations while avoiding wasted investments.
IT Modernization Tops C-Suite Priorities
According to the survey of over 800 IT decision-makers across nine countries, nearly two-thirds of executives rank IT modernization as a top priority. Enterprises are no longer just focusing on cost savings — they’re now looking at modernization as a driver of innovation, agility, and customer satisfaction.
Planned spending in the next two years is expected to reach 25–30% of IT budgets, but organizations that lack a well-rounded strategy risk falling behind.
Barriers Holding Back ROI
The study revealed the top challenges businesses face in modernization:
- Cybersecurity risks (51%)
- Data quality and integration issues (43%)
- Skills and training shortages (39%)
For enterprises in the Philippines and beyond, these issues echo a familiar story. Many companies adopt new tech quickly but underestimate the need for training, data management, and strong security measures.
The Competitive Advantage of Mature Strategies
Organizations with mature, integrated approaches covering infrastructure, applications, data, security, people, and AI readiness are achieving twice the results compared to less-prepared peers.
Michael Curry, President of Data Modernization at Rocket Software, emphasized that success isn’t just about adopting AI or cloud technology. Instead, it comes from “embedding security, governance, and skills development into every phase,” turning IT modernization into a real competitive advantage.
Key Research Insights
Some of the standout findings from the IDC White Paper include:
AI-Ready Infrastructure: 44% of businesses are prioritizing AI-ready tools and platforms. Among the most advanced, 82% are already building infrastructure for high-performance AI models.
Cybersecurity First: 57% of respondents will make cybersecurity and resiliency their top investments in 2025.
Data as the New Gold: Leading organizations are heavily focused on data quality, cataloging, and stewardship to ensure trustworthy enterprise-wide access.
AI and Cloud Skills: Nearly half of businesses plan to strengthen in-house AI expertise and improve data pipelines.
Mainframe Modernization: About 26% of enterprises will update mainframes to better integrate workloads and enterprise data.
Why Talent and Strategy Matter More Than Ever
The study also highlighted a talent gap as a critical challenge. Half of the surveyed enterprises plan to grow IT headcount, with a strong focus on AI, cloud, and cybersecurity skills.
Mary Johnston Turner, Research VP at IDC, noted that modernization maturity is “not just about technology adoption — it’s about the ability to adapt, scale, and deliver measurable business value.”
For local companies, the lesson is clear: modernization isn’t just about chasing the latest tech. Without a comprehensive strategy that includes security, skills, and data governance, investments risk falling flat. Businesses in the Philippines can learn from global leaders by pairing tech adoption with strong organizational readiness to stay competitive in the AI-powered economy.
If your business is looking at digital transformation, don’t just focus on tools. Invest in people, security, and long-term strategy to make sure every peso spent on IT modernization delivers ROI.
See where your organization stands: take Rocket Software and IDC’s 8-minute Modernization Index assessment to measure your IT strategy across six critical pillars and benchmark against peers.
To download the full IDC White Paper (doc #US53640525, July 2025), click here.