Businesses have more positive outlook on their ‘new normal’
After months of social distancing and learning to navigate in a pandemic, the world is adjusting to what is seemingly the new normal. Working from home, connecting with colleagues via virtual meetings and donning face masks are now part of everyday life. And businesses of all sizes are having to make tough choices on budgets, staffing, supply chain and product offerings, in order to keep businesses humming.
In June 2020, OneAffiniti conducted a survey of almost 2,400 IT Decision Makers (ITDMs) and Business Decision Makers (BDMs) to understand how the economic climate is expected to affect their business through the end of 2020, and what their new normal looks like. We’re looking at that survey in comparison to one that we conducted in April of this year, in which we heard back from roughly 2,500 ITDMS and BDMs regarding the initial impact that COVID-19 had had on their revenue and IT budget.
The main takeaway: revenue, though still down, looks like it will be less-severely impacted than originally thought. Of course, this is great news.
More optimistic views
In the recent survey, 59% of respondents are forecasting a slight or significant decrease in revenue through the end of 2020 relative to their original forecast. This number, compared to the previous result of 72% of respondents. Of those who are expecting a decrease in revenue, the June report has only 24% of respondents expecting that decrease to be significant, when in the previous survey, it was 39%. These two points both strongly imply that businesses are becoming more optimistic about the rest of the year. It doesn’t surprise anyone to learn that majority of companies are expected to lose revenue during 2020, but it is highly encouraging that as time progresses, businesses may be beginning to recover, and the losses might not be as significant as was originally feared.
Budgets are being adjusted
In the previous report, 74% of respondents reported flat or increased IT budgets in the month of March and April. Now with a better outlook, 60% of respondents report that their IT budget remains flat or will increase the next 6 months. With 14% more respondents reporting decreased budgets, it seems that more businesses are tightening their purse strings, and being more conservative in their spending. Presumably, budgets may have been initially increased to accommodate for setting up for their ‘new normal’ – i.e. working from home, or adjusting with hardware and software needed to be more flexible due to the rapid changes that COVID-19 necessitated. Now that those adjustments have been made, and companies are readjusting based on their revenue predictions for the next six months.
Though the numbers may be slightly different, the focus on the budget is still largely the same: remote work capabilities. Large and small companies alike are investing in tools that help mobilize their staff, finding nearly half (46%) of respondents investing in remote working. Of the 52% not currently investing in remote working, 36% claim to be ‘already set up for remote working’. The areas that will be most heavily invested in are Laptops, General IT Support, Desktop/sPCs, Security, Cloud-based Software, Video Conferencing, Software, and Servers. The importance of a mobile workforce is clear, and does not appear to be diminishing any time soon. Understandably, this focus is likely to flatten in the next 12 months, as demand drops as more people join the ‘already set up’ camp.
It’s highly encouraging that businesses are seeing their sales pick back up, albeit slowly. It’s even more encouraging that outlooks for the remainder of 2020 are more positive. As always, we’ll continue monitoring what’s happening in the market, and we’ll be sure to post updates as we receive them from the thousands of ITDMs and BDMs in our audience.
To view the full report, click here.