To map how businesses are spending their technology budgets in the coming year, and identify which emerging trends are on the horizon, Spiceworks surveyed more than 1,000 technology buyers in companies across North America and Europe. As the business technology market nears $4 trillion in annual spend, there will be increasing opportunities for technology vendors and service providers to grow their businesses, and for technology buyers to innovate and upgrade their infrastructure, software, and services.
Here are some key findings:
Factors Driving Course Corrections
What’s driving IT budget increases in 2020? Overall, the need to upgrade outdated IT infrastructure continues to be the biggest driver, followed by escalating security concerns, and employee growth.
However, budget drivers vary by company size and location. For example, “a greater priority placed on IT projects” is the top factor influencing IT budget growth in enterprises, likely because large organizations are typically better funded and have more resources to allocate against strategic initiatives than SMBs. Additionally, with more data, departments, and employee devices to connect, manage, and secure, 25% of enterprises are also increasing IT spend due to a recent security incident, compared to only 4% of small businesses.
Compute the orbit and velocity of IT budgets
Spiceworks also examined how business technology budgets will be allocated across hardware, software, cloud services, and managed IT services. Hardware will continue to get the highest IT budget allocation, but hardware budgets as a percentage of total IT spend are waning slightly from 35% in 2019 to 33% in 2020.
Budgets for software, cloud, and managed services will remain steady year over year, but the mix varies depending on company size. For example, the smallest companies will spend a significantly greater percentage of their IT budgets on hardware, but as company sizes grow, enterprises will spend less on hardware and more on managed IT services than SMBs, resulting in a more even distribution of enterprise spend across hardware, software, cloud, and managed services.
Our team would be happy to talk to you about implementing the IT solutions your business really does need to remain competitive.