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Gartner IT Spending Forecast

Gartner-IT-Spending-Forecast

The Gartner IT Spending Forecast was recently released and this is what B2B sales and marketers should incorporate into their go to market strategy and tactics.

B2B Sales and Marketers should read this post to learn what Gartner is saying about:

  • IT spending growth in 2018 through 2021
  • The 4 big headlines for IT in 2018: Alexa, AI, Blockchain and CLoud Computing

Global IT spending growth began to turnaround in 2017 Gartner expects annual increases through 2021. Despite some uncertainty, organizations are expected to continue to invest in IT as they anticipate revenue growth, but their spending patterns will shift. Gartner believes that investments in digital business, blockchain, IoT, and progress from algorithms to machine learning through artificial intelligence (AI) will remain strong.

Gartner IT Spending Forecast Key Takeaways

  • Global IT Spending was $3.5T (growth in software was 8.6% – cloud computing grew at 35%)
  • Data Center Systems growth is expected to decrease in 2018 as organizations are moving out of the data center to AWS and others
  • Smartphones are part of Devices and the 4% growth
  • There is a light currency tailwind
  • The US is responsible for about 40% of growth in IT Spending – US experienced 5.5%growth in 2018
  • AI Will Return 3B Hours of Worker Productivity in 2018

Gartner IT Spending Forecast Headlines – Alexa

Alexa Leaves The House & Gets a Job

  • Virtual Personal Assistants (speakers) to grow in excess of 38%, $3.5B in spending by 2021 and this does not include commerce dollars
  • Enterprise integration is a key focus for Alex – business applications like setting up conference calls, dial into conf calls, recording meeting notes are low hanging fruit
  • Virtual Personal Assistants (VPA) will need to be integrated into the ent auth process, your calendar, emails, get smarter through machine learning (set your priorities)
  • Two way communication is key – not just voice, alerts, texts, etc.

Challenges For Alexa

  • Integration – organization’s need to integrate Alexa with MSFT Exchange and other enterprise systems
  • Security – it’s unclear how to protect the privacy of employees- voice may allow access to private information and might be accessed by anyone within voice reach
  • NLP is one of several technologies in the portfolio within AI (voice is one, image recognition and classification are others)

Gartner IT Spending Forecast Headlines – Artificial Intelligence (AI)

Gartner’s Key Takeaways for AI

  • In 2020, AI is expected to create 2.3M jobs (healthcare, public sector and education will benefit the most)
  • And, AI will eliminate 1.8M jobs (the impact varies by industry but manufacturing is expected to be hit the hardest)
  • By 2025, AI is forecast to add 2M net new jobs
  • Specific, repetitive tasks will be automated, focus people on human brain power tasks
  • Most workers will use AI without knowing it (CRM, SFA, ERP, etc), invisible penetrate the enterprise
  • AI projects have been most successful when they are focused on narrow, well-defined use cases
  • AI is the best when it’s the augmentation of humans or decision support

AI Will Become Commoditized (Affordable) Because of Cloud Offerings & These Are The 3 Key Enablers

  1. The advent of chips that support the running on edge devices (inferences)
  2. AI frameworks that support device based AI components – end-to-end architecture
  3. Vendors of AI components offer per use models vs upfront models (cost moves from CapEx to OpEx)

Here’s How AI Will Boost Productivity in Enterprises

  • Custom Projects
  • Customer Facing Channels
  • Major App Suites
  • Niche Solutions
  • Industrial IoT
  • Embedded Devices
  • AI PaaS

Business Goals that Organizations Are Pursuing Using AI

  • Improve speed and efficiency – better allocation of staff and improvement of existing processes
  • Better data processing and analytics – manage event logs and tickets
  • Enhance customer experience and engagement – customer care and service desk optimization

Why it’s the Right Time for AI – the Perfect Storm

Here’s why Gartner believes that AI will be adopted:

  • The availability of high performance computing
  • The explosion of available data (formats, structure, sources, etc)
  • New deep learning algorithms
  • The proliferation of cloud platforms
  • The advances in Machine learning (ML)

Gartner IT Spending Forecast Headlines – Blockchain

  • Blockchain technology is very real
  • Blockchain offers the ability to interact or perform transactions without having a middle man
  • Today, most of an organization’s systems and processes rely on middlemen or centralization and blockchain could possibly eliminate middle-men
  • Although blockchain is new and relatively immature, Gartner expects significant value from blockchain technology
  • Blockchain is expected to create $176B in business value by 2025 and over $3T by 2030 – both from new revenue generation and cost savings across vertical industries (going beyond financial services, healthcare and government)

Gartner-IT-Spending-Forecast-Headlines-Blockchain

Four Types of Projects Are Well Suited for Blockchain Today:

Blockchain Use Case – Projects Across an Organization

The biggest and best suited applications are those that are horizontal, across companies and industries.  For example, a group of banks working together on tiering and settlements of trades.  Another blockchain example are manufacturers using blockchain across it’s suppliers and partners to produce and deliver an identical ledger for all involved – no one controls or is able to manipulate the data.

Another use case for blockchain are Smart Contracts.  This is where blockchain is used programmatically to represent contracts, agreements or even simple business rules that an organization needs to run with multiple parties (a manufacturer and a supplier for example).

Blockchain Use Case – Projects Within a Company
AN organization can use blockchain for its own benefit.
Use blockchain for common data across divisions, subsidiaries, geographies, etc.

Blockchain Use Case – Record Keeping
Immutable copies of records that can not be corrupted (very significant in government, healthcare, financial services).

Blockchain Use Case – Cryptography Technology

  • Projects based on cryptography technology itself.
  • Cryptography is a method of storing and transmitting data in a particular form so that only those for whom it is intended can read and process it.
  • The term is most often associated with scrambling plaintext (ordinary text, sometimes referred to as cleartext) into ciphertext (a process called encryption), then back again (decryption).

Gartner IT Spending Forecast – Cloud Market

Hottest Cloud Markets in 2018

  • CRM
  • Office Suites
  • ERP
  • IaaS

Cloud Market Overview

  • Cloud vendors are now focusing on the heart of an organization – their data center operations
  • Cloud vendors must focus on delivering value at the core of the data center and data center operations
  • The cloud market will continue to experience growth by simply replacing traditional applications and moving them to a cloud model
  • The cloud market is expanding beyond the mainstream market (from early majority to the late majority) which is sizeable
  • North America is the most mature cloud market and now western Europe is following
  • High rates of adoption now accelerated adoption rate China and India, Russia, increase it spending in a catch up mode to more mature economies

Top Cloud Providers Will Squeeze Out Smaller Competition

  • The top 10 providers have more than 50% share of IaaS, PaaS and SaaS
  • Multi-cloud strategies predominate, centered on strategic cloud investments
  • Cloud markets are bifurcating, particularly in infrastructure services
  • Top cloud providers outpace the market and increase overall market share

Summary – Gartner IT Spending Forecast Headlines for 2018

  • Alexa leaves the house and gets a job
  • AI will return 3B hours of worker productivity in 2018
  • Blockchain will create $176B in business value by 2025
  • Top cloud providers will squeeze out smaller competition

 


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Sales Guide to Predictive Analytics >>

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