Tuesday, January 26, 2021

Will "Most Businesses" Maintain or Increase IT Spending in 2021?

Small and medium businesses in Australia and New Zealand indicate they will maintain technology spending in 2021, according to IDC, with the Bell curve of responses centering on “stay flat” and “increase up to 10 percent.”


So does that mean "most" businesses will behave that way? We cannot say, as few concepts are as wiggly as the definition of "small and medium business."


source: IDC 


The important footnote--as always with the SMB category--is that the IDC definition of SMB is a firm with “fewer than 500 employees.” In most countries, firms with more than a dozen to a few dozen employees are quite rare. 


Keep in mind that in many parts of Australia, 97 percent of all firms have fewer than 19 employees. There are almost no “medium” sized firms (or large firms) in the range identified by IDC, in western Australia, for example. 


source" Small Business Development Corporation 


In many Organization for Economic Cooperation and Development countries, there are not so many firms in the size range of “at least 250 employees.”


In Canada, 98 percent of firms have 99 employees or fewer. 


The point is that IDC data skews towards relatively larger firms, not the “micro” enterprises that represent most “small businesses.”  So the findings about information technology investments will not apply to most businesses, by definition.


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