Despite a surge in investment and enthusiasm, most businesses have yet to unlock real customer value from artificial intelligence. A new Red Hat survey reveals that 89% of organizations haven’t seen tangible returns from their AI initiatives, even as they plan to boost AI spending by 32% by 2026.
AI and Security Lead IT Priorities
The report highlights that AI and cybersecurity are now the top technology priorities for UK businesses over the next 18 months, with 62% of respondents ranking them as essential. Following closely are hybrid or multi-cloud strategies and virtualization, signaling a shift toward integrated, flexible, and secure digital infrastructures.
However, the path to effective AI adoption is far from smooth. Many organizations cite significant obstacles, with high implementation and maintenance costs topping the list of concerns (34%). Data privacy and security risks follow at 30%, while system integration challenges affect 28% of respondents.
The Rise of “Shadow AI”
One of the report’s most striking findings is the prevalence of “shadow AI” — the unauthorized use of AI tools by employees outside official IT oversight. An astonishing 83% of organizations reported such activity, underscoring a growing disconnect between formal AI strategies and how staff are actually experimenting with the technology.
While this trend suggests an eagerness to leverage AI’s potential, it also raises serious security and governance concerns. Unapproved AI usage can expose companies to data leaks, compliance breaches, and operational inefficiencies.
Open Source Emerges as a Strategic Foundation
To tackle these challenges, UK enterprises are increasingly turning to open-source software. According to the report, 84% of respondents consider enterprise open source critical to their AI strategies — not only for cost efficiency but also for collaboration, flexibility, and innovation.
“Organisations are investing substantially in AI but currently only a few are delivering customer value,” said Joanna Hodgson, UK Country Manager at Red Hat. “In the journey from experimentation to sustainable production, enterprise knowledge and integration with core systems must pave the way. Openness is key — it enables collaboration, flexibility, and makes AI more consumable and reusable.”
Agentic AI Takes Center Stage
When it comes to specific areas of focus, agentic AI — systems that can operate autonomously — is the top priority for 68% of UK businesses. Other key goals include enabling wider employee adoption and making AI operational at scale.
Ryan Daws
Yet, the skills gap continues to be a major hurdle. For the second consecutive year, AI tops the list of urgent skills shortages. Within that, expertise in agentic AI, efficient AI utilization, and workforce education remain the most difficult to fill.
Balancing Optimism and Reality
Despite these challenges, UK organizations remain optimistic about their global standing in the AI race. Eighty-three percent of respondents believe the UK is already a leader in AI or will become one within three years. However, the report cautions that limited funding, a weak talent pipeline, and low private sector engagement could hold the country back from realizing AI’s full value.
Cloud Integration Adds Another Layer of Complexity
The integration of AI into cloud environments presents its own set of difficulties. Businesses face issues such as internal silos, data sovereignty concerns, and unclear returns on investment. As a result, many are prioritizing operational control, supply chain security, and IT vendor flexibility to maintain agility.
“Enterprises want greater control and resilience to adapt in a world of constant disruption,” said Hans Roth, SVP and GM for EMEA at Red Hat. “Open source provides the transparency and flexibility businesses need to innovate rapidly without compromise.”
