SMB Shops Optimistic About IT Spending in 2008

Published: November 19, 2007

by Timothy Prickett Morgan

The Computing Technology Industry Association (CompTIA) recently co-hosted the SMB Summit in Boca Raton, Florida, and used the event to reveal the results of a survey that it commissioned among small and medium businesses in the United States, the United Kingdom, and Canada to figure out what they expected to do in terms of IT hiring and technology investments over the next year. The news is good--particularly for those running small IT operations or providing products and services to them.

CompTIA hired AMI-Partners, a consultancy that specializes in the SMB space and that co-hosted the SMB Summit with the hot-shot consultants at McKinsey & Co as well as CompTIA, to survey SMBs about their hiring and spending plans in the IT area. AMI-Partners received responses from 724 companies across a wide range of industries that had fewer than 1,000 employees.

Among those responding to the survey, which was conducted in October, 45 percent said they expected to grow their annual sales by more than 10 percent over the next 12 months, and a stunning 21 percent of those surveyed said they expected to grow their businesses by more than 20 percent over the next year. Considering that the economy is not growing all that fast, and the uncertainty in the larger economies for a variety of reasons right now, such predictions of double-digit growth seem remarkable. Nine out of 10 of those responding to the survey said they planned to add full-time employees in the next year, and a third said they planned to open a new business location. It is helpful to remember that 55 percent of those surveyed did not expect double-digit growth, and while CompTIA didn't cop to it, there are probably as many companies declining as growing, even if they do not want to admit in a survey that they are in a decline.

When asked about their technology spending plans, SMB shops were pretty precise about the kinds of things they will invest in. Some 29 percent of SMBs cited secure data backup, storage, and disaster recovery were key investment areas (as if they were all the same thing). Another 24 percent said that Voice over IP (VoIP) telephony was where they would plunk down some cash. Even server virtualization is getting some play among SMB shops, with 19 percent saying they would spend in this area. Another 13 percent cited storage area networks as a technology they would be investing in, and 18 percent said Wi-Fi wireless networks needed some dough, too.

"These are all solutions that allow an organization to get the most out of its technology infrastructure investment," explained John Venator, president and chief executive officer at CompTIA, in a statement accompanying the numbers. "This is an important shift. Historically, SMBs tended to replace technology reactively when something went wrong. Now they are proactively looking for solutions that enable them to leverage their networks and boost productivity and efficiency."

Here's to hoping that SMBs are leading indicators for a good, healthy economy in 2008.

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