This year is quickly coming to an end, and many companies are working on or finalizing budgets for next year. With the pandemic, supply chain issues and somewhat fluid changes to where we work and when it can seem unpredictable on what the next new thing will or should be.
Across the board, companies are making substantial investments in their IT, with 2022 expected to be the largest increase in spending in the past 10 years. CIO Dive recently published a great article (https://www.ciodive.com/news/it-technology-budget-2022-Gartner/608407/) with data from Gartner showing an expected 3.6% increase over last year’ IT spending with a focus on adapting technology to more quickly leverage data and platforms with new offerings layered on top.
While the information from Gartner paints the overall picture across enterprises with 500+ employees, the SMB segment is also poised to increase spending over previous years. According to the 2022 State of IT (https://swzd.com/resources/state-of-it/#soit-2022) from Spiceworks Ziff Davis, 45% of companies with 1-499 employees plan to increase their IT spending next year.
So where is this money being spent? While supply chain constraints and long lead times on hardware are driving up spend in that category, the largest shift is toward applications and services moving to the cloud. Experts estimate (https://swzd.com/resources/cloud-trends/) that 50% of all business workloads will run in the cloud by 2023, up from 40% in 2021. Flexibility, accessibility and scalability are the name of the game.
From my seat at Calyx, I see many businesses facing challenges when it comes to where they should budget and plan, and I think there are 5 key areas to check and focus on for any business:
- Cyber Liability Insurance. This is your coverage for if and when you have a breach, attack or data loss incident. Much like our homeowners and auto policies, there are new types of coverage available and needed as time goes on. Make sure to work with your insurance provider to review all of your options and make the right investment to protect your business.
- Make sure your coverage is broad enough to manage your risk
- Understand your obligations for training, user awareness and documentation
- Schedule an annual review of requirements well in advance of policy renewal in the event that you need to implement controls or changes
- Licensing Increases. Across the board, we are seeing most software vendors increase their prices, especially coming into 2022. From Microsoft to Citrix to security vendors, as they make investments in their products and cost of living/inflation continue to rise, expect to see more annual increase to follow.
- Reach out to your vendors proactively to understand what is coming and to avoid surprises
- Determine if a multi-year contract or renewal can save you money
- Hardware Refresh Plan. While many businesses had to make rapid purchases of laptops, webcams and all of the other peripherals to work from home in early 2020, many have fallen behind on their regular lifecycle for equipment to preserve funds. While this was an important decision to make before, aging hardware is a productivity killer and should be on the docket moving forward. Long lead times and increased prices mean that planning now to make investments over time will help ease the burden.
- Assess the current age and status of your equipment
- Plan to have spare hardware on standby during rollouts in the event of an unplanned failure of older equipment
- Check with your remote staff to understand what equipment they have or may have provided that needs to be compatible to minimize interruptions
- Cyber Security. While this should always be a top priority, the sophistication of attacks is increasing, many more verticals are being targeted and risk is ever higher. Evaluating your security stature and making sure things like multi-factor authentication, EDR and a response plan are in place are key.
- Determine where multi-factor authentication is not enabled and make a plan to enable it
- Assess endpoint and server security
- Review where data is stored and accessed, especially with remote employees; if they have data stored locally it is at risk of loss or ransomware on their computer, not just on servers or cloud storage
- IT Strategy. The world has changed over the last few years, if you have not revisited your IT plan and mission, now is the time. When increasing spend on IT, or any business unit, alignment between overall business objectives and strategy is key.
- Assess how your staff has adapted to different work scenarios
- Are you ready for a largely remote workforce in the future?
- Does your app stack and delivery method work for you or against you?