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IT Budgets and Spotting the Hot Trends

by Kenneth Murphy

October 24, 2012

By Ken Murphy.

With Friday’s impending release of Windows 8, time will soon tell whether Microsoft hits a home run with its revamped operating system.  Regardless of how Windows 8 is received, the timing of its release guarantees that it will factor prominently in what’s expected to be one of the top IT trends of 2013: mobile device battles.

Gartner released a list Tuesday of what its analysts expect to be the top 10 strategic technology trends of 2013, and to no one’s surprise the quest for mobile supremacy topped the list. Microsoft’s new release, of course, features a hybrid touchscreen interface designed with a nod toward mobility’s increasing influence.

Most of the strategic trends, mobility’s role in enterprise included, dovetail with SAP initiatives, such as cloud computing (SuccessFactors) and in-memory computing (HANA). To be included on Gartner’s list, the trending strategic technology – whether existing or emerging – must have the potential for significant impact on an enterprise in the next three years. Enterprises, of course, must decide which, if any, of these trends are worthy of their finite IT department resources. At least according to one recent survey, most are betting on mobility.

According to member-based advisory company CEB’s 2013 budget benchmarks, released earlier this month, CIO’s are expecting to invest heavily in mobile applications. In a survey of more than 180 companies representing $52 billion in IT organization spending, spending on mobile applications and making sure existing applications are ready for a mobile environment is expected to grow by 50 percent next year. Cloud spending is expected to rise by 7 percent (with the bulk of that devoted to SaaS spending, followed by IaaS). A separate report by consulting firm IDC, also from earlier this month, estimates that spending on cloud computing – which now accounts for roughly 1 percent of IT outlays – may triple in the next four years.

The IDC and the CEB reports both expect modest gains in IT budgets for 2013. CEB’s poll of CIOs reveals they expect a 1.8 percent increase in their budges (50 percent less than 2012 budget increases). The IDC report, which sampled IT spending from enterprises in 52 countries, expected IT spending to increase by 3.3 percent, with the majority of the net increase coming from emerging markets.

 An interesting article in Information Week posted today takes a closer look at why IT department budgeting isn’t keeping pace with the changing roles and increasing demands placed on an enterprise’s IT organization, such as the growing expectation that IT should drive new business opportunities and revenue. One reason: “shadow” buying, where 75 percent of IT professionals surveyed say that technology budgets “unofficially” exist outside of IT. For more on “shadow” buying, SAP Press author Michael Doane describes the practice of “rebel, secret, under the table” budgeting in this Insider Learning Ne twork podcast.

And what, pray tell, do those “unofficial” budgets spend their money on? You guessed it: mobility and cloud.

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