All the facts worth knowing about IT leaders' tech budgets, spending plans, hiring priorities and strategic initiatives for 2016.

As Written by: Computerworld Staff and Contributors on computerworld.com

Ready, set, disrupt!

If an overarching conclusion can be drawn from the results of Computerworld's Forecast survey of 182 IT professionals, it's that 2016 is shaping up to be the year of IT as a change agent.

IT is poised to move fully to the center of the business in 2016, as digital transformation becomes a top strategic priority. CIOs and their tech organizations are well positioned to drive that change, thanks to IT budget growth, head count increases and a pronounced shift toward strategic spending.

Amid the breakneck pace of change in technology and business alike, where should you direct your focus in the new year?

Read on for key highlights and data points on budgeting, hiring, business priorities and disruptive technologies that promise to define the IT landscape in 2016.

IT budgets on the rise...again

As companies continue to rely upon technology to help differentiate themselves in the marketplace, tech budgets remain on an upward trajectory.

Almost one half (46%) of respondents to the Forecast 2016 survey indicated that their technology spending will increase in 2016, on average by 14.7%. (By comparison, last year 43% said spending would increase, on average by 13.1%.)

Close to an equal number (42%) reported that their technology spending will remain the same, with only 12% anticipating a decrease in IT budgets.

Security, cloud computing are top areas for investing

With security concerns top-of-mind for IT professionals as they gear up for 2016, it's no surprise that exactly half of respondents chose security as the top area where their companies plan to increase spending.

Cloud computing came in a close second, and the top area where organizations plan to decrease spending is on-premises software -- both of which indicate that companies' journey to the cloud will continue in 2016.

IoT tops new areas of spending for 2016

After several years of languishing in the tech hype cycle, the Internet of Things finally looks to be commanding tech execs' attention, with 29% of respondents identifying it as a new area of spending for 2016.

Green IT, which likewise had been back-burnered at many organizations, popped up on respondents' radars as well, with 16% saying energy-saving technologies will be a new spend for them in the year ahead.

IT pros' No. 1 challenge: Budgeting

As they do every year, budget constraints top the list of leadership challenges identified by survey respondents.

Security came in second among IT pros' concerns after a year of ever bigger and more serious corporate hacks.

Sam Redden, chief security officer at Brazos Higher Education Service, a Waco, Texas-based student loan servicing company, sums up the feelings of many IT leaders when he says, "I wouldn't be foolish enough to say I stay ahead of the bad guys. The bad guys stay ahead of everybody."

Dueling goals for IT in 2016

Survey respondents' goals for their most important tech projects betray the bimodal nature of the modern IT department.

Tech leaders say they're striving to maintain or improve service levels, long one of IT's core responsibilities. At the same time, they're seeking to generate new revenue streams or increase existing ones, a new responsibility in most evolving technology departments.

"As technology becomes an integral part of every aspect of business and the way we interact with customers, it's raising the profile of the IT group and forcing IT to think about more than just keeping the lights on," says David Cearley, a fellow at Gartner. "We are seeing greater alignment as IT steps up to drive digital business.

A piecemeal journey to the cloud

Heading into 2016, cloud computing shows no signs of slowing down, as tech leaders indicate that spending and new cloud initiatives remain on the upswing.

In terms of where organizations are in their cloud transition, 29% of survey respondents confirmed they had already moved some enterprise applications to the cloud, with more to come, while 7% said they're in the process of migrating mission-critical systems to a cloud environment.

Interestingly, a full 20% of respondents are bucking the trend entirely, reporting they're not moving to the cloud at all.

IT staffs to increase in 2016

As budgets rise and projects abound, many firms are looking to increase IT head count. Some 37% of survey respondents said they're planning to increase staff levels, up from 24% last year.

In keeping with IT's new role as an organizational agent of change, 42% of survey respondents with hiring plans are in search of people with combined tech and business backgrounds that will allow them to articulate the value of IT in meeting business goals.

Architecture, app dev among most wanted skills

The list of most in-demand IT skills starts off with a surprise. Although IT architecture is a fundamental area of expertise for techies at all levels and in various roles, it rarely makes anyone's list of hot skills.

The term "IT architect" encompasses a wide range of specialists, from enterprise architects to cloud architects, so recruiters say it makes sense that IT architecture expertise is in demand as companies move forward with all sorts of technology-driven projects.

Beyond that, application development, project management, big data, BI, help desk and cloud all remain high on hiring managers' lists as IT gears up for the year ahead.

(Download and save or print a free PDFof Computerworld's top tech skills for 2016.)

John Reed, senior executive director of IT staffing firm Robert Half Technology, says those hiring managers could be facing a challenge. "The IT market has been really strong, and we're expecting it will stay that way for the foreseeable future," he says. "I don't think you'll see explosive growth, but you'll see single-digit growth in demand, consistent with what we've seen over the past few years."

Security, BI talent expected to be scarce

With all eyes on security in the coming year, it's little surprise that survey respondents expect to have a difficult time hiring technologists with that expertise.

According to Robert Half Technology's 2016 Salary Guide, salaries in the security field will rise about 5% to 7% next year, ranging from $100,000 on up to nearly $200,000 on average.

Disruptive technologies 3 - 5 years out

When asked what technologies are likely to have an impact in the next three to five years, survey respondents chose cloud computing/software-as-a-service by a wide margin, followed by self-service IT, predictive analytics, the Internet of Things and unified communications.

The cloud will continue to reshape enterprise IT, according to research firm IDC, which predicts that more than half of enterprise IT infrastructure and software investments will be cloud-based by 2018. Specifically, spending on public cloud services will grow to more than $127 billion by 2018, according to an IDC forecast report.

Kicking the tires on new technologies

All manner of virtualization and "as-a-service" options topped survey respondents' lists of technologies being piloted or beta tested at their organizations, with BI/analytics, cloud computing and mobile/wireless rounding out the top five.

"Virtualization 2.0" is of particular interest to survey respondents, as companies move beyond the first steps of server virtualization to explore virtualized desktop, storage, mobile and network options.

2016 is IoT's year to shine

In 2016, the Internet of Things (IoT) will no longer be the stuff of science fiction, but rather a near-future reality for IT organizations across many industries, observers say.

In Computerworld's Forecast 2016 survey, 29% of the respondents identified IoT initiatives -- and related machine-to-machine and telematics projects -- as new areas of spending for the year ahead. In comparison, just 12% of those polled last year said IoT work would be a new IT expenditure in 2015.

Likewise, the percentage of respondents who said they planned to launch IoT projects over the next 12 months rose from 15% last year to 21% this year. Additionally, 14% of this year's respondents said they plan to beta-test IoT technologies, up from 7% last year.

Wearables in the enterprise? Not so much

While consumer-oriented wearable devices like Google Glass and the Apple Watch launched to great fanfare, the reality is that enterprises aren't ready to make practical use of wearable systems, at least for the foreseeable future.

Wearable technology was last on the Forecast 2016 list of systems currently being assessed in beta tests and pilot projects, with only 4% of respondents saying they had projects underway involving wearables.

Furthermore, 78% said they were not currently working on wearable apps or anticipating the need to support wearables in the near future. And only 8% of those polled said wearables would play a role in their business or technology operations, while just 12% indicated that they were adjusting their mobile device management strategies to include wearables.