The Intel earnings warning yesterday was a sobering indicator that the high-tech industry is in for a pretty rough patch, one in which your team’s ability to align better with your channel partners and execute on your top priorities quickly will be paramount.
Intel is a leading indicator, generally, of the big hardware OEMs, so we’ll be watching closely to see what they say in coming weeks. A couple of the big market research firms have adjusted their IT spending forecasts. Forrester Research, as an example, reported in September that 43 percent of the close to 1,000 companies that it follows had already cut their IT budgets for 2009, while approximately 29 percent were putting new projects through a closer scrutiny (suggesting, at the very least, longer sales cycle times). Interestingly, it reported that 90 percent of companies from the entertainment, leisure and media industries were not cutting back on IT services spending.
I don’t normally post the bi-monthly CDW IT spending trend data in this blog but I figured since we’re all trying to figure out what the heck is going to happen to our businesses and our lives over the next year, that having some additional survey visibility into the minds of IT buyers would be useful. CDW looks at businesses of all sizes, PLUS the government, so they’ve got some worthwhile stats to ponder.
It should come as little surprise to you that cost management is the top priority next year for the roughly 1,058 IT decision makers that were covered in the latest CDW year-in-review poll, which was conducted in late September before things really started to look grim. About 41 percent cited this area as their No. 1 concern, compared with 32 percent for the next biggest priority, which was investment in new products and technologies. Surprisingly (and it would be interesting to see if this holds up in the next batch of data that comes in), the percentage for the latter priority was up 5 percentage points from what CDW survey respondents said LAST year about THIS year.
The only thing that I found worth noting is that managing operational costs was LESS of a priority for respondents who classified themselves as small businesses than growing market share. Only 27 percent of small businesses cited the former as a priority, compared with 36 percent who picked growing market share.
A couple of other relevant data points that I picked up.
First, the weak economic environment was cited by 42 percent of the respondents to the latest survey as the biggest obstacle to growth in 2009. This compares with 38 percent that listed it last year. What’s more interesting, however, is that LAST year, organizational changes and employment recruitment and retention were also big factors (cited by 20 percent and 24 percent of the respondents, respectively). In the last survey, however, NO other obstacle garnered more than 8 percent of the respondents. So the economy looms LARGE. It loomed LARGEST for small businesses: 52 percent of the small-business respondents said the weak economic environment was their one biggest obstacle to growth next year.
Second, aside from the other priorities that I already mentioned, workforce performance became a bigger priority for 2009 than it was in 2008: 31 percent of the respondents to the most recent survey named it as a priority, compared with 25 percent who cited it last year.
You can actually read some of the trending data in my past CDW-related posts on TechTarget. Here are some of those links:
CDW: IT spending plans relatively stable (July 11, 2008)
Seized with doubt: CDW IT Monitor reflects buyer uncertainty (May 20, 2008)
Would love to hear about any visibility you have that supports or refutes these observations.
Feel free to comment or e-mail me directly at firstname.lastname@example.org.