KUALA LUMPUR (March 21): Global overall IT spending will grow 2.4% in 2023, with enterprise IT spending projected to grow 4.1%, according to Gartner Inc.

In a statement on Monday (March 20), the consulting firm said the context of IT spending is changing as buyers increasingly value and make investments in business outcomes rather than buying solutions.

Gartner vice president and fellow Mark McDonald said changes in context challenge the relevance of technology solutions.

“Lower relevance reduces willingness to pay and renew relationships. Gartner sees relevance as the connection between a provider’s solution and how applicable it is to current customer needs.

“That connection exists at every level from the C-level to individual developers. Without relevance, we see sales cycles extend and renewals at greater risk,” he said.

Gartner said context is dynamic, requiring leaders to raise their relevance across three situations — the now, and whenever context changes in the near term, with the ultimate goal of positioning solutions for future growth when economic conditions turn favourable in the next economy.

“It is up to the provider to know when context changes and to rebuild context through refocusing messaging and repositioning to meet customers where they are,” said McDonald.

Meanwhile, a poll by Gartner showed that 72% of high tech leaders in the US, Canada and Western Europe have plans to grow revenue in 2023.

The consulting firm said that furthermore, nearly half of those leaders believe they will be able to outperform their competition this year.

The Gartner survey was conducted in the second half of 2022 among 195 respondents in the US, Canada, the UK, France and Germany, to understand how economic turbulence poses challenges to general managers, how confident they are in their ability to achieve their plans, and the measures planned to tackle the uncertainty.

McDonald said outperforming the market through an uncertain market requires an above average ability to execute on revenue ambitions.

“The survey results indicate that almost half of firms (46%) do not have sufficient ability to execute to reliably realize their revenue goals.”

The survey found that many technology leaders entered 2023 prepared for a potential recession.

Paradoxically, many of the actions taken concentrated on reducing costs rather than focusing on growing revenue and market relevance, it said.