Rackspace Technology® (NASDAQ: RXT)— a leading end-to-end, multicloud technology solutions company, today announced that despite the rise of inflationary pressures and a global economic slowdown, few organizations are scaling back on IT investment and most are committed to spending more, according to a new survey Managing IT in Challenging Economic Times a survey of 1,420 IT decision-makers across manufacturing, retail, hospitality/travel, healthcare/pharma/biomedical, government and financial services sectors in the Americas, Europe, Asia, Australia and the Middle East.
Though survey respondents identified the economic slowdown, inflation, and rising energy as the three leading factors impacting their organizations, 53% say that investment in technology has increased because of these pressures, while only 26% say they have invested less, and 21% say they have maintained the same level of investment but have reprioritized based on evolving needs. Looking forward, 68 % of those surveyed say the current economic climate is leading them to invest more in IT infrastructure, while only 32% plan to reduce their overall investment.
“Technology is gaining momentum as businesses realize how digital transformation can benefit them in the long run. The spending context may vary for different businesses, dependant on their maturity level with digital enterprise, but overall technology spending will rise. Despite the economic slowdown, inflation and budget cuts, technology investment is still expected to rise by 69% globally”, said Sandeep Bhargava, Managing Director, Asia Pacific Japan, for Rackspace Technology.
Seeking Efficiencies Through the Cloud, Innovation
According to the research, IT organizations are adopting a variety of approaches to adjust to the current economic climate, led by an increased focus on cloud projects that can drive efficiencies (52%) and investment in innovation projects (60%). Across all global regions including India, leaders identified cloud projects as the single most important factor in navigating the current economic climate, as well as the leading source of re-prioritized investment versus their original budget allocation.
Moreover, when asked to rank their leading areas of investment focus for the next 12 to 18 months, cloud operations emerged as the most important strategic IT priority, at 68%, followed by automation (55%) and security (54%) among Indian professionals. More than 30% of respondents also say they either have already moved or plan to move all their IT infrastructure to the cloud, while a further 47% only expect a small percentage of infrastructure (between 1% and 10%) to never move to the cloud.
As they increase their cloud investments, organizations are also becoming more sophisticated at managing cloud costs and deriving value from their investments, with 82% of organizations saying that their FinOps capabilities are either of medium maturity or high maturity.
Even in Tougher Times, Talent Remains Scarce
Even amidst economic uncertainty, Indian IT organizations are still facing a tough talent environment. 57 % said they are struggling to fill vacancies, especially in the areas of cybersecurity (52%), machine learning (47%), data analytics (35%), IT Project management (29%), network engineering (28%), data engineering (27%) and cloud architecture (27%).
67% of organizations are also struggling to retain IT staff with specific in demand skills. In response, they are offering making work/life balance improvements (55%), additional training opportunities (51%), instituting salary increases (48%), increasing the value of rewards (47%), among other tactics.
Over half of respondents (60%) said their organization is downsizing employees, led by reductions in HR (47%), sales and marketing (43%), and business operations (37%). Finally, given talent scarcity, 90% of organizations in India are also looking for ways to enable technology to perform work traditionally performed by humans, especially in the areas of business operations (67%) and customer service (65%).
