IT Spending Trends for 2016 – A Subcategory Shortlist

By Rich Staas

Director of Client Services, NPI

November 30, 2015
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In the weeks ahead, the market will be flooded with IT Spending Forecasts for the coming year. While NPI isn’t in the business of producing such forecasts, we do have a close pulse on where our clients are planning to spend their IT budgets and where they’re most concerned about overspending.

Here are the top five areas based on our data:

1. Security – High-profile security breaches continue to be a financial, legal and reputational threat to many businesses. Just ask Target, Home Depot and Michaels. This along with the explosion of mobile technologies has necessitated the need for ongoing investment in increasingly mature security technologies. NPI has seen a growing number of purchases in access control, intrusion prevention, identity management, and virus and malware protection. The biggest spending pitfalls in this area? Sub-optimal business terms and discounts.

2. Cloud Computing – Almost as unsurprising as security, investments in the cloud continue to drive a large portion of enterprise IT spend, especially in big infrastructure investments. The degree to which this spend will increase will be partially dependent upon on how aggressively the vendors incent their customers to migrate. This opens the door for big savings for customers that know which levers to pull during negotiations – as well as big overspending for those that don’t. It’s a great time to buy if you’re ready.

3. Business Analytics – Big data is still a big deal for enterprises and many are increasing their spend on enterprise analytics, data mining and business intelligence. This will only continue to grow as the Internet of Things juggernaut hurtles into the mainstream – more data to manage, mine and monetize. Buyer beware: These projects often require cumbersome implementations where scope creep can generate major cost overruns.

4. Wireless/Mobile – Our clients’ spending plans show that organizations will continue to invest a significant amount in mobile technologies, such as remote access tools, wi-fi, mobile/wireless devices, mobile device management systems,. Companies will also invest in technologies to support BYOD programs and the technologies required to provide secure mobile access to internal systems. As with security, sub-optimal business terms and discounts are typical IT sourcing risks to navigate.

5. Application Development and Application Development Outsourcing – In 2016, NPI expects to see greater (and significant) spend on developing, upgrading and replacing applications; and on mobile application development and testing products, services and tools. Much of this work may be outsourced thereby adding another layer of cost and complexity.

Where will you be spending your IT budget in 2016? Where you are most concerned about overspending?