A new report from Red Hat finds that 89 percent of businesses are yet to see any customer value from their AI endeavours. However, organisations anticipate a 32 percent increase in AI investment by 2026.
The survey finds that AI and security are the joint top IT priorities for UK organisations over the next 18 months, with 62 percent of respondents citing them as necessary. These are followed by hybrid or multi-cloud strategies and virtualisation, showing a clear direction in the technological focus of British businesses.
However, the path to AI integration isn’t straightforward. The vast majority of organisations are facing barriers to adoption, with the high costs of implementation and maintenance being the biggest concern for 34 percent of respondents. Data privacy and security issues are a close second, troubling 30 percent, while 28 percent are struggling with the integration of AI into their existing systems.
A particularly interesting finding is the prevalence of “shadow AI,” with 83 percent of organisations reporting the unauthorised use of AI tools by employees. This suggests a disconnect between official IT strategy and the day-to-day practices of the workforce, potentially introducing security risks and inefficiencies.
In an effort to navigate these challenges, UK organisations are increasingly turning to open source software. The survey reveals that 84 percent of respondents consider enterprise open source important for their AI strategy, with similarly high figures for virtualisation, hybrid and multi-cloud, and security.
Joanna Hodgson, UK Country Manager at Red Hat, said: “This year’s UK survey results show the gap between ambition and reality. Organisations are investing substantially in AI but currently only a few are delivering customer value. In the journey from experimentation to sustainable production, enterprise knowledge and integration with enterprise systems must pave the road to achieving value from AI.
“Openness is a force for greater collaboration, sharing best practice and enabling flexibility. As is the case with successful hybrid cloud investments, open-source will continue to be the bedrock for making AI more consumable and reusable.”
The survey also explored the specific areas of AI that are being prioritised. Agentic AI, which involves systems that can operate with a high degree of autonomy, is the top priority for 68 percent of respondents. This is followed by the desire to enable broad employee adoption and to operationalise AI.
The skills gap remains a persistent challenge, with AI being the most urgent area of concern for the second consecutive year. Within the field of AI, the talent shortage is most acute in agentic AI, the ability to efficiently use AI capabilities, and educating the wider business on how to use AI.
Despite these domestic challenges, there is a strong sense of optimism about the UK’s position on the global AI stage. 83 percent of respondents believe the UK is either already a global AI powerhouse or has the potential to become one within the next three years. However, this confidence is tempered by a lack of talent pipeline, limited public funding, and insufficient private sector engagement, which are seen as the main factors holding the UK back from extracting value from AI.
The report also touches on the complexities of cloud adoption, which is further complicated by the integration of AI workloads. Internal silos, sovereignty concerns, and unclear return on investment continue to be barriers. In response, UK organisations are prioritising operational control and autonomy, securing the software supply chain, and maintaining flexibility in their choice of IT suppliers.
Hans Roth, SVP and GM for EMEA at Red Hat, commented: “Organisations want greater operational control and IT resiliency to adapt in a world of constant disruption. The survey results, as well as our daily conversations, show sovereignty prominently on the agenda for enterprise’s ongoing cloud strategies and the budding AI opportunity.
“Open-source is central to this shift as it provides businesses with the transparency and flexibility to innovate rapidly without compromise.”
The findings from Red Hat’s latest survey show the UK is ready to tap the value potential of AI, but is also struggling with the practicalities of implementation, skills shortages, and the complexities of the technological environment. The strong emphasis on open-source suggests a pragmatic approach, supporting collaboration and flexibility in the pursuit of AI-driven innovation.
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