Digital Business Will Increase IT Spending in 2017

By Mike Vizard  |  Print this article Print
2017 IT Budgets

The rise of digital business transformation will accelerate adoption of cloud services in 2017 at a much faster rate than we've seen previously.

Pat Sullivan, global Oracle technology lead at Accenture, adds that the amount of data new applications are generating is driving customers toward cloud services, which are capable of handling it in a way that makes building, deploying and maintaining these applications simpler.

"Data volumes are driving organizations into the cloud," said Sullivan. "IT organizations have a tough time stitching all the technologies together on their own."

Perhaps most significant of all from the perspective of solution providers is that as these investments in digital business processes increase, the relationship between solution providers and customers also starts to change. CP Gurnami, managing director and CEO of Tech Mahindra, said the IT solution provider is increasingly either delivering entirely new business processes on behalf of customers or simply taking over existing ones in their entirety.

Thanks to the rise of the cloud, Gurnami said that it's more feasible than ever to outsource a digital business process, which provides the customer with the added benefit of reducing their own upfront investment in what is often an unproven use case. In effect, he added, customers are not as interested in the technologies employed as they are in the ultimate business outcome enabled by much more agile IT solutions delivered via the cloud, which are treated as an operating rather than capital expense.

"It's now only a matter of time before everything moves into the cloud," Gurnami predicted.

Of course, not every company is moving down the path to digital business transformation at the same rate. Arguably, most of them don't have a conscious digital business strategy at all. Instead, as they invest in mobile applications and advanced analytics, they gradually discover their digital business potential. However, once discovered, many of them dramatically increase their level of investments to cut costs and drive new streams of revenue.

The challenge facing solution providers going into 2017 is making sure they find a way to stay relevant. Barring a massive recession usage of almost every class of technology, tech budgets should increase in 2017. What will be different is how those technologies are delivered.

There will still be plenty of investments in technologies delivered via a local data center in 2017. But it should be apparent to all by now that the rise of digital business transformation will accelerate adoption of cloud services in 2017 at a much faster rate than we've seen previously.

Mike Vizard

Mike Vizard, a Channel Insider contributor, has more than 25 years of experience covering IT issues in a career that includes serving as Director of Strategic Content and Editorial Director for Ziff Davis Enterprise.