30 Jul Gartner predicts IT services spending rise, but warns on innovation
Along with its prediction that global IT services spending will rise 9.5 percent this year, analyst firm Gartner commented on currency values, return on investment (ROI) and companies seeking low-cost providers.
In a statement released with its recent IT spending report, Gartner analyst Kathryn Hale said that the falling value of the U.S. dollar, not just executive decisions, has increased the amount of spending when expressed in dollars.
Furthermore, Hale called out vendors, saying that the rate of innovation in service offerings is “sporadic, at best” and that a problem in the industry is the inability of vendors to provide compelling value statements. She said it has been hard to find companies who say they have experienced strong return on investment.
Another factor called out as reducing innovation is “a common buyer mentality that focuses on IT cost takeout and adopts a ‘lowest cost wins’ decision-making in its services and sourcing decisions,” Hale said.
Gartner’s report predicted that IT services spending will reach $819 billion this year. The biggest share, 42 percent, is in outsourcing of IT management process management. Business process outsourcing is sought in particular by firms who wish to cut costs.
Gartner also predicted that consulting, development and integration spending would grow 10.1 percent to $327 billion for the year.