3 technology spending trends (what Simplus is doing about it)

According to IDC’s recent webinar, The Worldwide SMB Market: Technology Spending and Trend Outlook, small and midsize businesses of 1,000 or fewer employees are forecasted to increase spending on information technology, with a greater share of that spending going toward software (such as Salesforce) than before. And more of that software investment will continue to go toward software maintenance rather than innovation. These trends align with the products and services Simplus offers to businesses: Salesforce implementation, Managed and Advisory Services, and training.


Trend #1: IT spending will increase

First off, information technology will continue to be a big deal. IT spending among small and midsize businesses (SMBs) is forecasted to increase globally across the board for 2018. SMBs plan to spend more on IT (hardware, software, and services) in 2018 than they did last year, for a total of over $600 billion, up from approximately $570 billion in 2017. Although midsize companies spend more than small businesses at about a 2 to 1 ratio, growth in IT spending from 2017 among all small and midsize groups is projected to increase by approximately 5%.


Trend #2: Software will top hardware in spending growth

Although a lion’s share of the dollars spent on technology is forecasted from now until 2021 to remain in hardware, the top six fastest growing areas will all be in software, while the top six slowest growing areas will be hardware.

The top fastest growing areas will be software applications, all with projected double-digit growth: cognitive/AI software, file sync and share, other (CRM, software storage, collaborative and system infrastructure software), sales, customer service, and human capital management applications. Salesforce is among all of those categories.


Trend #3: Maintenance will continue to dominate innovation

In a look at the share of IT spending on maintenance versus the share spent on innovation, SMBs are planning to continue to spend over half of their technology budget on maintenance: support of their current business operations and practices. Although the buzz about innovation might suggest otherwise, SMBs are not making a significant leap toward innovation. They only plan to spend approximately 2% more this year than last on innovation or expansion capabilities. The exception is among the midsize businesses in developed countries, which plan to increase innovative technology spending by just over 4%.

This focus on maintenance is in part due to how many SMBs already have modern software driving revenue: over 80% of midsize firms across geographic regions have cloud engagement, and the software’s importance to their operations is only increasing. In addition, over 50% of small businesses globally have cloud applications. That number is nearly 60% in the United States.

Related: Use what you pay for: How to utilize hidden gems in Salesforce


How Simplus addresses the trends: Centrify’s case study

That sentiment of supporting current business practices and solving current problems by focusing on maintenance is what led Centrify to contact us at Simplus. Centrify previously had insufficient configure, price, quote (CPQ) software integration; a large product catalog that made building a quote complicated; and confusion over changing old processes.

“We were forcing our reps to make a decision based on this long list of SKUs. You know, people are people—we make mistakes. A sales rep would accidentally click a two-year instead of a three-year subscription, or a standard service level instead of a premium service level. It was really just becoming a problem on the backend,” says Mark Gremban, Senior Sales Operations Manager.

Simplus helped the company implement a CPQ solution with a new pricing model that simplified and automated processes. In addition, we helped Centrify employees learn best practices to best utilize their streamlined system. The end result was a reduction in time for building quotes—from minutes to seconds.

Related: Here’s what differentiates Simplus from the competition

Simplus loves IT innovation. But we also understand the need for top-notch IT maintenance, especially as IT spending increases, which is why we focus so much on providing exceptional Managed Services, Advisory Services, and training opportunities. Even when we’re simply implementing a new instance, we instill best practices to make sure a Salesforce instance can be maintained for maximum potential in your business processes.


Does your business have problems that IT can solve? Do you need greater integration or consultation to fully tap into the potential of your current systems? Do you need custom solutions to build on your infrastructure? Let Simplus help you build on your investment.

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