2 min read

Canadian mid-market IT spending on the upswing

Mid-size businesses around the world say they plan to increase their IT budgets over the next 12 to 18 months

A recent global IBM (NYSE: IBM) study revealed that of the more than 2,000 mid-size businesses that were surveyed, more than half plan to increase their IT budgets over the next 12 to 18 months.

The survey titled, Inside the Midmarket: A 2011 Perspective, was conducted on behalf of IBM by KS&R Inc. in the fourth quarter of last year. The survey included responses from 2,112 business and IT decision makers of mid-size businesses (100 to 1000 employees) from 22 countries around the world.

Andy Monshaw, general manager, IBM general business and midmarket group, said the survey results display a “turn around” of the past 18 months.

“Fifty-three per cent of mid-size businesses said they plan to increase their IT budgets over the next year, compared to only 20 per cent from the 2009 mid-market survey,” Monshaw said. “More than 75 per cent of these mid-size businesses are planning to upgrade their core IT infrastructure to improve performance, security and reliability.”

The top three answers for “most critical business priorities for 2011” were: cost reduction and improved efficiencies (76 per cent), improved customer services (73 per cent) and increased employee productivity (70 per cent).

When respondents were asked what their top IT project implementations were, 75 per cent said they’ve either started or intend to implement IT infrastructure improvements, 70 per cent said collaboration, 70 per cent said business analytics and intelligence and 70 per cent said business performance management.

“Analytic capabilities are now consumable with (mid-market) customers,” Monshaw said. “It used to be very expensive to have business analytics but now we have hundreds of dashboards that are tailored to meet the needs of small and mid-sized clients and they’re also industry-specific.”

Monshaw said the survey also revealed that more than 70 per cent of the respondents stated they’re seeking a consultative IT and business approach with their primary IT provider, instead of a transactional relationship.

“Partners must evolve their business models to be more services oriented, whether it’s IT services, business services or partnering with other partners to satisfy the needs of this marketplace,” Monshaw said. “Cloud computing has changed the nature of what clients can consume and business analytics has really taken off. These solutions have a higher degree of service knowledge requirements which is why partners must adapt.”

The study findings also show that in the U.S., the top three IT focus areas for mid-market customers are business analytics and intelligence, CRM and security management. In Canada, this is the same except instead of security management, Canadian mid-size businesses are focusing on infrastructure improvements.

Follow Maxine Cheung on Twitter: @MaxineCheungCDN.