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VMblog Expert Interview: Peter Tsai Talks Spiceworks Ziff Davis 2021 State of IT Report

interview-swzd-tsai 

This week, Spiceworks Ziff Davis announced its annual 2021 State of IT study examining technology budget shifts and emerging technology adoption trends in organizations across North America and Europe.  To learn more, VMblog spoke to Peter Tsai, SWZD Senior Technology Analyst.

VMblog:  SpiceWorks just released the results of their annual "State of IT" report.  Can you give readers an overview about the study and what it covers?

Peter Tsai:  The State of IT an annual study produced by Spiceworks Ziff Davis that examines future IT budget plans and emerging technology adoption trends. The 2021 State of IT also examines how COVID-19 and the global shift to remote work have served as catalysts for change that will affect IT for years to come. 

VMblog:  How many people did the study survey and what were their demographics?

Tsai:  The survey was conducted by Spiceworks Ziff Davis in June and July 2020 and included 1,073 business technology buyers from organizations across North America and Europe. Respondents represent a variety of company sizes, including small-to-medium-sized businesses and enterprises, in addition to a variety of industries including manufacturing, healthcare, non-profits, education, government, and finance.

VMblog:  What were some of the most significant findings in this year's report and why?

Tsai:  We found COVID-19 to be a major catalyst for business transformation. 76% of businesses plan on long-term IT changes due to the pandemic, over half plan to retain flexible work policies, and 44% plan to accelerate digital transformation plans. These transformation plans not only drove tech spending in 2020; More than a third of 2021 budget increases will be influenced by COVID-19.

Overall IT budgets are expected to decline year-over-year in 2021, but only slightly. Even amid economic uncertainty, 80% of businesses anticipate tech spending to stay the same or increase next year.

We're also seeing several key shifts gaining momentum. For example, 35% of organizations have or plan to accelerate migration of workloads to the cloud due to COVID-19. And while hardware spending in 2021 will still account for the largest portion of IT budgets, it is expected to decline YoY, as businesses increase cloud and managed services spending.

VMblog:  Are there any major differences between the 2019 report and the 2020 report? 

Tsai:  Yes. Going into 2020, the majority of organizations were optimistic about future business prospects. However, overall company revenues are expected to stagnate in 2021 due to slowing economic activity resulting from the global pandemic.

While one-third of businesses expect revenues to increase year-over-year from 2020 to 2021, that figure is down significantly from 58% expecting revenue growth between 2019 to 2020. Additionally, 31% of organizations believe revenues will decrease YoY from 2020 to 2021, compared to only 7% last year.

VMblog:  Were there any unexpected results that surprised your team?

Tsai:  While businesses will continue to invest in emerging tech in 2021, adoption plans are expected to drop significantly year over year, especially among smaller businesses, which will deprioritize cutting-edge features - that might not offer immediate return on investment - in favor of more pressing needs such as updating outdated infrastructure and securing a remote workforce.

For example, going into 2020, 35% of companies said they were currently or planning to use AI within 2 years, but going into 2021, that number has dropped to 29%. Similar significant drops are expected for IoT, containers, edge computing, 3D printing, VR, and blockchain.

VMblog:  What kind of impact or challenges did COVID-19 play in your findings?  

Tsai:  As we mentioned, the coronavirus pandemic will influence tech spending in a major way in 2021. Among all businesses, the following plans have or will result from COVID-19: 

  • 44% plan to accelerate digital transformation 
  • 36% plan to improve IT operations & systems performance 
  • 33% plan to improve security, risk, & governance 
  • 32% plan to connect employees using standardized, secure, and easy-to-use tools 
  • 30% plan to develop training aids to support remote employees 
  • 27% plan to refine disaster recovery plans to account for additional scenarios

Additionally, more than a third of 2021 budget increases will be influenced by COVID-19.

VMblog:  What about the shift to work from home?

Tsai:  According to our data, the "remote work revolution" will continue to impact businesses for years to come. More than half of organizations plan to keep flexible work arrangements in place even after the risk from the pandemic subsides, and many businesses will shift spending habits to support an increasingly remote workforce.

For example, as a percentage of overall IT spending, businesses will increase cloud and managed services spending, likely influenced by the shift towards flexible work policies that will see fewer employees in central offices with on-premises infrastructure. 

Additionally, 32% of organizations have either already migrated or plan to accelerate migration of workloads to the cloud due to COVID-19 and 26% of businesses indicated they are planning to increase VDI deployments specifically because of new needs that have surfaced due to COVID-19.

VMblog:  According to report findings, what are some of the emerging trends being identified?  And are IT shops spending here?

Tsai:  The massive shift to remote work has seen employees around the globe taking devices and data outside of the relatively safe confines of corporate networks. This has sparked many concerns, particularly regarding endpoint device security, vulnerability management, detection of security events, and security incident response. As a result, we expect a significant uptick in the adoption of several security technologies, including employee training tools, anti-ransomware solutions, hardware-based authentication, breach detection systems, security solutions powered by AI, and cloud workload protection

And as it has been in previous years, increasing security concerns will continue to be one of the top drivers of budget increases in 2021.

VMblog:  Finally, where can readers go to find out more about the report?

Tsai:  You can read the full 2021 State of IT report at swzd.com/resources/state-of-it.

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Published Thursday, September 17, 2020 7:33 AM by David Marshall
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