Digitization and technology led solutions helping companies to continue the workflow during a pandemic outbreak. According to the latest Gartner forecast, Worldwide IT spending is forecasted to reach $4.1 trillion in 2021, approx 8.4% growth from the last year 2020.
Digital business initiatives source of funds will more often come from business units outside IT and charged as a cost of revenue or cost of goods sold (COGS).
Almost all IT spending divisions are forecast to have a positive rise through the year 2022. The biggest growth will come from devices (14%) and enterprise software (10.8%) as businesses turn their focus to giving a more convenient, innovative and productive conditions for their workforce.
“IT no longer just supports corporate operations as it traditionally has, but is fully participating in business value delivery,” said John-David Lovelock, distinguished research vice president at Gartner. “Not only does this shift IT from a back-office role to the front of business, but it also changes the source of funding from an overhead expense that is maintained, monitored and sometimes cut, to the thing that drives revenue.”
However, the optimization and cost savings exercises won’t fade simply because there’s more economic certainty in 2021, the focus for CIOs through the remainder of the year will be completing the digital business plans that are aimed at improving, increasing and transforming the organization’s value position.
Recovery to pre-pandemic outbreak spending levels varies
The improvement over the countries, vertical industries and IT segments still differs significantly, prompting a K-shape economic recovery.
Industry wise recovery – the banking & securities and insurance spending will nearly resemble pre-pandemic outbreak levels as early as 2021, while retail and transportation won’t be able to see the same recovery until closer to 2023.
Regionally, Latin America is expected to recover in 2024, while Greater China has already surpassed 2019 IT spending levels. North America and Western Europe are both expected to recover in late 2021.
Source: Gartner (April 2021)