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Inflation is stagnant, economic growth lagging and – according to Gartner at least – IT budgets are currently shrinking. So just where are businesses looking to spend their money in 2016?
Traditionally, IT managers had a limited number of options for spending. It could be broken down into three distinct categories: systems, security and software.
In the last five years, mobility, the cloud and an increasing need for evermore complex security arrangements has put pressure on IT managers and their budgets. As a mission critical activity, ‘business as usual’ is expensive, but it’s not enough. To stay ahead you’ll need to invest in the cloud, embrace mobility and plan for the future.
Taking the industry as a whole, it’s interesting to read where the money might be spent in certain sectors, but what does this mean on the ground?
There’s increasing debate over what’s the most appropriate hardware to invest in. Laptop, desktop, tablet or even mobile are all used by businesses. The key to all is value for money, with many suggesting to us that they’ll be shopping around for the best deals.
Ongoing relationships with suppliers may limit choice, but one key focus area for budget holders is software.
“Most organizations overspend on software by up to 30 per cent,” says David Chamberlain, General Manager of Software Asset Management Services at License Dashboard. When you consider that software makes up around a third of most IT budgets, that’s certainly a substantial sum.
One way businesses are dealing with software budgets is through Software Asset Management (SAM) systems. Budget holders can intelligently manage licenses; using only what they need and staying protected from audits. “It’s a great way for IT Managers to make the most of their IT budget and shift spend to other priorities,” Chamberlain adds.
It’s likely software will be a large part of any planned spend. The move to the cloud and the rise of Software as a Service (SaaS) has transformed the nature of IT procurement and budget management.
IDC estimates that by 2018 at least 50 per cent of IT spend will be with the cloud. Putting increasing pressure on budgets, Yusuf Yegenah at IT support organisation Microbyte outlines what this means for 2016.
“We envisage more time and investment being spent in investigating methods to move internal infrastructure to the Cloud, if not entirely then certainly by co-location,” he states. According to Yegenah, businesses should be focusing on reducing top-level technical management, allowing large providers to manage the transition and the solution.
Many small businesses may, of course, feel uneasy about relinquishing all control of their infrastructure to an outside party. “If you don’t feel comfortable there are plenty of cloud-based vehicles that will allow you to offload the management of hardware such as servers, firewalls and networking,” Yegenah adds.
James Eades, Managing Director of IT services business Systemagic, gives us his top picks for 2016: “My three recommended areas for IT investment in 2016 for any business are security, collaboration and mobility.”
Cybersecurity is now big business, with Yegenah believing that 2016 will see the continued “revolution in smaller companies taking on new ways of managing security such as Multi-factor Authentication (MFA) and Single Sign-on (SSO)”.
Whatever industry you’re in, security spend is likely to be one of the biggest and most important budget lines.
The year ahead promises to be challenging, with budget managers needing to keep something back to combat against unexpected events or to fund innovative new projects. It’s unlikely most businesses will be able to match the 33 per cent earmarked for 2015 by CIOs in the States, but IT teams should be confident in their power to innovate and change to keep them – and their businesses – relevant.