IT Spending Expectations Remain Steady in Second Half of 2012, But Under Increased Scrutiny

Despite an uncertain economic outlook, IT spending growth is expected to continue into the second half of 2012 as initially budgeted according to several reports and surveys.

A survey by CDW Corporation, of more than 1,000 IT decision makers, found that half expect their company's budget to increase. 43% anticipate no change and only about 8% foresee a decrease in the second half of the year. A majority of those surveyed, 73%, will be replacing or upgrading current hardware, software, or solutions and services compared to 27%, who will be making new purchases.

Of the half that will be spending more for IT solutions and services, 52% will be spending more on server/storage/client virtualization. Forty-five percent will be spending on wireless/networking, 43% on security, 39% on cloud computing, 31% on managed services, along with 24% on unified communications, and 20% on converged data centers.

Although 71% will be maintaining their current IT staffing levels, 23% plan to hire more IT personnel and only 5% plan to trim their staffs in the second half of 2012.

Regardless of an uncertain economic outlook both domestically and globally, Garner Research has not made any major change to its overall 2012 IT spending outlook. Richard Gordon, a Garner research VP who leads their global IT spending forecast, commented "... is basically holding about the same.”  IT spending has grown 3% in 2012, which is slightly better from the 2.5% growth they predicted in the first quarter. They are now giving more emphasis to cloud spending and more purchasing and use of client devices (PC, tablets, smartphones, etc.).

He characterized the current economic situation as "not getting any worse so we are going to see some modest growth this year ... [IT] investments are still being made but they are being made ... with a lot of scrutiny attached to those budgets. ....There is a real sort of ROI mentality right now."

According to Gordon, the specific ROI questions being asked by those who control IT budgets include: "does the investment help to leverage internal efficiencies, does it increase competitiveness, [and] does it help with new product development or targeting new markets?"

* Article provided by TechServe Alliance, Copyright, 2012.