Gartner: IT investments drop 7.3 percent in 2020
by Paul Davenport Paul Davenport on

Even businesses that have weathered the pandemic so far with aplomb are being cautious about their long-term investments, as economic conditions remain fluid and uncertainty looms over when workers will start returning to the office in large numbers.

As a result, many companies are pulling back their spend on office-centric IT projects and focusing instead on tech solutions that support a mostly remote workforce, even if only for the short-term.

The latest Gartner data shows that IT spending is estimated to drop 7.3 percent in 2020 to $3.5 trillion, as teams are learning quickly that the “old way” of managing enterprise IT suddenly doesn’t cut it in a primarily work-from-home (WFH) world. As a result, enterprises are pausing IT investments until they can figure out new strategies that can work in a post-COVID world.

“Overall IT spending is still expected to sharply decline in 2020 but will recover in a faster and smoother manner than the economy,” said John-David Lovelock, research vice president at Gartner. “Still, enterprises cannot return to previous processes that are now rendered outdated due to the disruption of their primary revenue stream during the pandemic.”

Gartner describes the overall economic outlook and the forecast in IT spend as taking a “swoosh” and a “swoop” trajectory, respectively. That means that while the overall economy may continue to recover only in fits and starts over the next year, IT spend will take a much more assured rebound as businesses grow more adept at supporting WFH.

By 2021, for instance, Gartner anticipates that IT spend will bounce back 4.3 percent – a conservative recovery that doesn’t account for the overall loss in spend, but a sure sign that teams are adjusting where they place their investments. IT services alone are expected to see a 5.5 percent bump in 2021 after dipping 6.8 percent in 2020, bringing it closer to pre-pandemic spending levels.

Perhaps more importantly, however, investment into software is actually expected to reach a new high next year, hitting $4.83 billion in 2021 versus $4.77 billion in 2019.

Altogether, this indicates that IT teams may not be growing (in fact, with many offices remaining offline, IT staffing may be leaner overall in the long term), but companies are still investing in solutions that can help IT “do more with less,” especially when it comes to solving WFH challenges.

Chief among these challenges is the ability for IT to actually glean insights into WFH user performance that are on par with their levels of visibility in-office. While teams will always face an uphill battle in assuring performance for users accessing the network outside of the office, a “local perspective” into how WFH users are experiencing their apps and the network arms IT with a proactive stance to tackle performance issues. This is critical to improving IT efficiency in a time when every second counts, and performance issues have the potential to have a more debilitating impact on the business than ever before.

AppNeta’s scalable and agile approach to network performance monitoring does just that, as it enables IT to monitor network paths beyond that “last mile” connectivity that grants WFH users access to enterprise network resources. This will help re-instill that confidence in IT that teams enjoyed in more predictable, pre-pandemic times, and help free up time for teams to take a break from “firefighting” and start thinking thoughtfully about how to optimize network management for the future.

To learn more, joining our webinar, 3 Ways to Make IT More Efficient, on July 28 at 1 PM ET to hear from the experts how IT teams can get started.

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Filed Under: Industry Insights

Tags: enterprise IT , enterprise , IT budget , IT , pandemic , COVID 19 , network performance monitoring , network monitoring , network management , IT budget , budget