Published on the 22/01/2026 | Written by Heather Wright

Confidence rebooted, tech budgets to follow…

Kiwi companies appear to be ready to reboot growth plans in 2026, with 65 percent of senior business leaders expecting economic conditions to improve over the next 12 months and 82 percent planning to increase their tech investment – much of it likely to be on AI.

Growth is a leading priority for 35 percent in Datacom’s third annual Business Outlook survey, which polled 200 senior leaders from organisations with more than 100 employees.

“While the imperative to drive efficiency and carefully manage costs has not diminished, there’s renewed interest in investments aimed at simulating growth.”

The Institute of Economic Research’s Quarterly Business Survey for the three months ending December also show optimism on the part of Kiwi businesses with a strong rebound in confidence: 39 percent of those surveyed say they’re expecting economic conditions to improve in the coming months – up from just 17 percent in the September quarter. The figures put business confidence at the highest level since March 2014.

Peter Nelson, Datacom New Zealand managing director, says he’s seeing clear early signs of confidence across the business community, with leaders signalling they’re ready to invest and innovate after a period of uncertainty.

 “While the imperative to drive efficiency and carefully manage costs has not diminished, there’s renewed interest in investments aimed at simulating growth,” Nelson says.

But the optimism comes with a practical twist: Modernise first, and then scale AI, with Nelson reporting that a frequent conversation with customers is the challenge of legacy technology and how hard it can be to modernise and make the most of technologies like AI for growth.

Last year saw many organisations flirting with AI pilots, or stalled in the exploratory phase – a scenario familiar to 46 percent of the businesses surveyed for Datacom’s State of AI Index in late 2025.

This year though, companies are ready to take flight and move beyond pilot projects and towards enterprise-wide adoption, Datacom says.

Its survey shows business leaders see AI adoption and implementation is the biggest technology opportunity for the year ahead at 51 percent, with a common focus on integrating and scaling AI into core operations such as workflow optimisation or customer service and support.

Louise Compagnone, Datacom director of AI, says it’s encouraging to see conversations shifting from if the business should adopt I to how they can effectively scale it.

“Organisations are starting to be more strategic about their deployment of AI,” Nelson says. “Initially, we saw a lot of organisations deploying AI tools in an ad-hoc way in specific areas of their business, but the net effect is that they get stuck in pilot mode and they can’t achieve the enterprise-wide impact businesses are looking for.”

Outside AI, it’s data optimisation (40 percent) and automation (30 percent) that are whetting leaders appetites for increased spend.

Behind the tech priorities sits the classic boardroom agenda of growth, even as economic uncertainty remains the leading perceived threat, cited by two in three senior business leaders. That tension may help explain the duality in investment: Leaders are still chasing efficiency, but they’re also loosening the purse strings for growth initiatives.

There are, however, some key stumbling blocks threatening to slow progress, despite the appetite for technology investment, with the ever present spectre of budget constraints (31 percent) and a lack of skilled workforce (30 percent) cited as the biggest challenges to successful adoption, alongside concerns about data quality.

Layer in the much vaunted brain drain (42 percent of respondents cited talent loss, especially of engineering skills), and you have a recipe for stalled projects.

Datacom points to a pragmatic workaround of pairing engineers with AI – a polite way of saying let the bots do the boring, repetitive crud while the humans tackle the more gnarly – and fun – work.

“A lot of the projects we’re going to see rolled out over the next 12 months will be reliant on highly skilled engineers paired with the smart use of AI,” Compagnone says.

Other perceived threats for the year? While cybersecurity might be a headline hogger – and something nearly half of businesses have had to contend with in the past 12 months (up 13 percent of 2024), it’s only second place, at 24 percent, behind economic uncertainty (35 percent).

Another familiar face takes third place, with future workforce concerns a top perceived threat for 19 percent.