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Key Issues For Enterprise IT Spend Decisions In 2020 (Summary)

When considering your company’s IT spend decisions for 2020, it’s helpful to know what your peers and competitors expect for IT spend this year.

  • What are their top investment priorities?
  • Their biggest challenges?
  • Is their focus different for 2020 than it was in 2019?
  • How will their plans change if the economy strengthens or if it weakens?

Surveys conducted it in November 2019 with senior stakeholders at hundreds of enterprises where it was report they are largely optimistic but slightly less optimistic than they were last year 2018.

Enterprises ended 2019 slightly more optimistic than their expectations at the beginning of the year. Their 2019 performance was a “fantastic year” for 11%. The year was slightly better than expected for 32% and about as expected for 37%. Only 20% of respondents reported it was a tough year.

It is also expected that talent shortage would be a bigger issue in 2020 then it was in prior years. Enterprise focus is also changing, while 64% reported their enterprise is increasingly value focused, and 32% are increasingly cost focused.

Regarding their expectations for 2020, most respondents anticipate a slowdown in growth this year. They are bracing for the results of uncertainties such as the weakening manufacturing growth and geopolitical issues such as Brexit, NATO, global trade and US/China trade. Yet, they remain committed to digital transformation.

Top Investments for 2020
The top investment priority for 2020 among the enterprises surveyed is customer experience. This is the case even if an economic downturn occurs.
Whether the economy strengthens or weakens, respondents reported their company’s priority is to invest in technologies and capabilities to improve customer experience as follows:

  •  If the economy strengthens, they will invest in technologies to streamline processes and will leverage analytics to find opportunities.
  •  If the economy weakens, they will invest in technologies that focus on reducing operating cost and increasing operational efficiencies.

For 2020, the pivot between business transformation and modernization will continue. Companies find they can’t improve the customer experience until they modernize their environment. Modernizing also saves money because modern IT estates cost less to operate.

Technology hot topics for 2020 include analytics and data management. Analytics will be the highest next-generation capability priority of most of the survey respondents (4.4%) for the next six to 12 months. Cloud solutions, at 4.3%, are close behind analytics. Automation follows at 3.9% as the next highest investment priority.

Top Challenges For 2020

Along with cost pressures, respondents reported that adapting to new business models is a top challenge.
Enterprises report they face multiple challenges in their digital/technology journeys. These challenges include:

  •  Organizational resistance to change impedes progress.
  •  Data-gathering and analysis capabilities are insufficient to support fact-based decision-making.
  • Integrating and adopting new technologies.
  • Insufficient internal resources to provide the new skills that transformation requires.
  • Capital investments.

Enterprises expect their service providers to help them address these challenges.
The acute shortage of next-generation skills, recognized in 2019, will continue to affect enterprises in 2020. Asked how they expect to address talent challenges. One of their top strategies is to build a longer-term talent pipeline. Partnering with educational institutions. A further strategy is more aggressive recruiting (including more competitive pay).
Finally, the acute talent shortage is an area where enterprises expect help from their service providers this year, as follows:

  • Providing in-demand skills.
  • Moving resources onsite, close to the enterprise business.


Original Article from Forbes site (Click here to view) by Peter Bendor-Samuel.

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