Midsize Outfits Increasing Tech Budgets: IBM

More than half of midsize companies are planning to increase their information technology (IT) budgets over the next 12 to 18 months, according to an IBM global study of more than 2,000 midsize companies representing over 20 countries.

As a result, these companies are investing in a wide range of priorities including analytics, cloud computing, collaboration, mobility and customer relationship solutions.

“Inside the Midmarket: A 2011 Perspective,” commissioned by IBM and conducted independently by KS&R, Inc., found 70% of midsize companies are actively pursuing analytics technology to better understand their customers, make better decisions and become more efficient.

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The study also shows growing adoption of cloud computing among midsize firms, with two-thirds either planning or currently deploying cloud-based technologies to improve IT systems management while lowering costs.

Other key findings include:

  • 53% of respondents expect their IT budgets to increase over the next 12 to 18 months, 31% expect they will remain unchanged and 16% think they will decrease or are unsure.
  • Security (63%), customer relationship management (62%) and analytics / information management (59%) were cited as their “Most Critical IT Priorities.”
  • 75% plan to upgrade their core IT systems to improve performance, security and reliability.
  • Top expected benefits from cloud computing include cost reduction, better manageability of IT, improved system redundancy and availability.
  • To achieve their technology objectives, more than 70% plan to pursue a consultative (IT and business), versus purely transactional relationship with their primary IT provider.
  • Top barriers to IT adoption cited were cost, difficulty in acquiring and deploying technology solutions, and lack of IT skills and resources.
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“The survey findings show that midsize firms are tackling a new set of opportunities to advance their role as engines of economic growth,” said Andy Monshaw, general manager, IBM Midmarket.

“When we spoke to midsize firms 18 months ago, most were focused on reducing costs and improving efficiencies. Today, the conversation is also about expanding their business, connecting with customers and gaining greater insights.”

The study was conducted in the fourth quarter of 2010 to capture current and upcoming business and IT priorities and investment direction. The findings were released Friday, Jan. 14.

RMN News

Rakesh Raman