IT Growth Outlook Hits Record High Led by Surge in Expected Investments: CDW

 
 
By Nathan Eddy  |  Posted 2012-01-31
 
 
 

IT Growth Outlook Hits Record High Led by Surge in Expected Investments: CDW


While overall anticipated IT spending has grown two percentage points to reach 42 percent, most sectors saw significant increases in spending optimism, according to the latest CDW IT Monitor. Growing optimism and greater anticipation of increased IT investments among IT decision-makers propelled the company's six-month growth outlook composite score to 71, jumping three points since October to reach its highest reading since its inception in late 2007.

The number of state and federal government IT decision-makers expecting an increase jumped 11 and 10 percentage points, respectively, with local government reporting decreased anticipated IT spending, slipping five percentage points since October. Within the private sector, IT decision-makers at medium-size businesses anticipating an IT budget increase soared seven percentage points since October, while small and large-size businesses each grew one percentage point.

The survey findings also indicated that more than a third (36 percent) of IT decision-makers plan to spend on mostly new assets, up eight percentage points overall, with medium- and large-size businesses seeing 14- and eight-percentage point increases, respectively. Those planning large investments climbed three percentage points overall, led by double-digit growth among decision-makers at medium-size businesses and within state government. Despite overall anticipated IT hiring dropping two percentage points since October, IT decision-makers at medium-size businesses and within federal government are expecting hiring increases of three and two percentage points, respectively, over the next six months.   

Overall anticipated demand for hardware and software investments reached a record high in both public and private sectors. Anticipated hardware spending climbed four percentage points to 80 percent overall, led by significant increases among small business (nine percentage points), local government (five percentage points) and state government IT decision-makers (eight percentage points). Anticipated software spending increased seven percentage points to 82 percent, driven by 10, eight and six percentage point jumps among IT decision-makers at small, medium and large-size businesses, respectively. In addition, expected software spend increased 10 percentage points among local government IT decision-makers.

"The data indicates that the IT spending outlook has reached a significant milestone. More IT decision-makers are feeling optimistic about the prospects of their IT budgets increasing, and they are anticipating significant IT investments in the next six months, especially on the hardware and software fronts," said Neal Campbell, senior vice president and chief marketing officer of CDW. "We believe that organizations will continue to look at technology investments as ways to boost efficiencies, increase productivity and gain new competitive advantages in 2012."

Expectations for IT solutions spending increased two percentage points to 45 percent, a 2011 high. This was led by a nine percentage point spike in anticipated spending from medium-size businesses, and two percentage point increases from both large-size businesses and within federal government.

Top Priorities


 

Of those anticipating increased solutions investment, the greatest priorities in the next six months are networking (58 percent), security (57 percent), virtualization (56 percent) and cloud computing (47 percent). Security investments quickly moved up IT decision-makers' priority lists, increasing seven percentage points since October.

Optimism over increased IT spending remained strong and steady among IT decision-makers in the health care, manufacturing and IT industries, while anticipated budget increases in the professional services industry jumped 10 percentage points since October.

Confidence among IT decision-makers in the professional services industry translated to a jump in anticipated hardware investments (14 percentage points), software investments (17 percentage points) and in IT solutions (10 percentage points) over the next six months. The retail industry continued to increase its investment optimism, with IT decision-makers anticipating three and nine percentage point increases in hardware and software purchases, respectively, since October. In addition, anticipated hardware spending in the manufacturing industry grew seven percentage points, while solutions spending in the health care industry is slated to increase six percentage points in the next six months.

The latest CDW IT Monitor indicates that three quarters (76 percent) of IT decision-makers report their organizations allow employees to use personal mobile devices for work-related tasks. Among IT decision-makers in the public and private sectors, security protocol implementation, employee adherence, cost and lack of IT resources top the list of challenges for integrating personal mobile devices into organizations.

Of the companies currently allowing the use of personal mobile devices for work-related tasks, one-third (33 percent) said they were either not confident or only somewhat confident that their protocols and security measures are effectively managing risks. While more than half of IT decision-makers surveyed are using both IT security measures and protocols, 19 percent reported that they are not managing the new risks introduced by personal mobile devices being used within their organizations.

"While it should come as no shock that organizations are increasingly allowing their employees to use their personal mobile devices for work-related tasks, many will be surprised to find that nearly one in five organizations are not managing new security risks at all," Campbell said. "Organizations that fail to address new security risks are flirting with disaster, and could face threats ranging from business continuity disruptions to data theft."

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