Wednesday, November 14, 2012

Gartner: Business Groups Will Soon Control 90% of Tech Spending - Are you Ready?


According to Gartner, twelve years ago technology spending outside of IT was only 20 percent of total technology spending.


In two years, Gartner Inc. Research Vice President Brian Prentice predicts, the percentage of technology spending by the business -- outside of the control of IT -- will reach 35 percent.

Moreover, by the end of this decade Gartner is predicting businesses will control a whopping 90 percent of technology spend.


The bottom-line: Is your sales and marketing ready for this Teutonic shift in IT purchase decision-making?


Consumerization and Cloud

The shift of technology spending from IT to the business units is driven by a number of factors, but according to Gartner, is mostly driven by:
  • Consumerization – expectations by users and the business for their systems and applications to look and perform like consumer offerings versus the perceived limited solutions being offered by core IT.
  • BYOD - users purchasing their own work tablets, laptops and other devices.
  • Cloud Computing – where the business procure their own infrastructure, platforms and software as a service.
The role of IT is clearly evolving, where for technology system purchases like marketing automation, CRM, HR and even supply chain management, IT departments are brought in to support the integration of these systems into the enterprise systems, but IT is not leading the purchase project.


Already the purchase process is more complicated, with 40% more stakeholders involved in a typical IT purchase decision, according to IDC.



The decision making process will become even more complex as the barriers between personal and business computing blur, and business decision makers take majority control of the valuation process.

Business leaders have different goals, challenges and valuation criteria than IT managers, requiring distinctly different messages for connecting, engaging and selling.

In particular, sales and marketing will need to communicate and quantify to business group leaders how proposed solutions will drive business process and productivity improvements and reduce current business costs and risks.

And financial acumen becomes more important, in order to engage and sell CFOs, financial and procurement executives on the proposals return on investment and payback.


Are You Ready?

Clearly purchase decisions are quickly evolving, as more technology purchase decision control migrates to business groups, and more stakeholders are engaged in each decision.

To be ready for this shift, sales and marketing will need to evolve in 2013:
  • Consultatively helping Core IT control costs and deliver better services and solutions to the business. As Gartner reports, part of the issue is that IT continues to be viewed as a utility, much like the power company with “IT organizations allocating probably 80% of their budget to keep-the-lights-on” versus driving new and innovative business solutions.
  • Quickly evolving from selling and marketing products primarily to technical decision makers to now engaging with business executives and even user community groups.
  • Quantifying the “Cost of Doing Nothing” for frugal business leaders and financial executives, in order to proactively and provocatively illuminate issues and prioritize which challenges to address.
  • Communicating and quantifying the value proposition uniquely and relevantly for each stakeholder’s unique “Point of Value”.
  • Deliver financial justification including ROI and payback analysis for CFOs and financial approval.
  • Quantify the total cost of ownership and benefit differences between your solution and other offerings in order to “Prove you are not the same”.

There’s no time like the present to understand what the Teutonic IT spending shift could do to your sales and marketing, and begin implementing the tools and training needed to be prepared. 

Click here to learn more.


Sources:

More technology spending in the hands of the business instead of IT


Gartner Says Big Data Creates Big Jobs: 4.4 Million IT Jobs Globally to Support Big Data By 2015 - Analysts Discuss Key Issues Facing the IT Industry During Gartner Symposium/ITxpo 2012, October 21-25, in Orlando - http://www.gartner.com/it/page.jsp?id=2207915

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