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An online survey of 200 IT executives for midmarket companies by Echo Research found 40 percent of respondents indicated that they expect their IT budgets to stay the same in 2009, despite a down economy. Not surprisingly, 77 percent of respondents listed reducing costs as the most important business issue, making it the top concern for IT executives.
However, security was the second-named initiative (59 percent) among those planned for the next six to 12 months, with data management being named most often at 61 percent. Nine out of 10 report that better access and information sharing and meeting service-level objectives are the key technology issues.
“This study confirms many trends that resellers might have suspected but didn’t have concrete evidence of before,” said Robert Spee, director of marketing for the Midmarket and IBM Groups of Arrow ECS, which sponsored the survey. “The survey clearly indicates what IT decision makers are focused on, what solutions they’re most interested in, and what their budgets look like for 2009.”
The survey found approximately 38 percent of midmarket IT executives require evidence of return on investment for technical purchases, and those respondents require an average of 33 percent ROI. Only 12 percent require a one-year payback, while 33 percent look at the total cost of ownership over multiple years as the financial requirement.
The number of executives who expect their budget to increase this year is equal to those who expect a decrease (29 percent). Those expecting an increase anticipate a 16 percent boost while those that expect a decrease think their budget will fall 18 percent. Reducing costs, the top priority for IT managers, is more important to respondents than improving security/reducing risk, which 38 percent listed as the most important issue in this year’s survey but was noted by 78 percent in the 2008 survey conducted.
A similar survey conducted by Compass Intelligence in April, also concentrating on small to medium-size businesses (SMBs), suggested midmarket companies are negatively affected, but not defeated, by the current recession. One of the survey’s key findings is that the majority of small-business IT buyers have remained positive about their IT spending during the most troubling and uncertain months of this recession, with 42 percent of those surveyed in March expecting to keep their ICT (information and communications technology) spending unchanged in 2009.
That survey also found another 20 percent of SMBs expect ICT spending to increase. While this is slightly down from research Compass completed in November of last year, they predict as the economy stabilizes and the various stimulus packages do their job that midmarket companies’ spirits and spending will start to rise later in 2009.