Report: 13% Fewer Companies Expect Technology Budgets To Stay Flat Or Increase In 2023 Compared To 2022

Bain’s third annual Global Technology Report draws on secondary market research, analysis of financial information, and extensive interviews with industry insiders to show that many companies are facing challenges due to current geopolitical and economic trends. Although we face uncertainty, it shows that these disruptions can often lead to progress.

According to Bain, 77% of companies expect to increase their technology budgets in 2023 or keep them the same. That’s a drop from last year, when 90% of companies expected his tech budgets to increase or remain unchanged for 2022.

And while tech companies are easily disrupted, Bain tells CIOs, CTOs, and other tech executives that despite difficult trends such as inflation and a looming recession, “technology will play a central role in the global economy. and help shape how the company grows.” Create lasting value for customers and other stakeholders in all sectors. ”

According to Bain, more than 75% of the largest venture capital investments in recent years have gone to IT infrastructure and industry-focused enterprise software companies, demonstrating innovation potential.

Investments in AI grow as technology gains market share

In addition to the findings above, Bain found that corporate investment in artificial intelligence (AI) is growing rapidly, with 86% of technology providers gaining market share and increasing customer loyalty. AI is becoming important to build.

But according to Bain, only about 20% of companies have the technology infrastructure to harness the full potential of AI. Today, AI has the potential to engage customers, shape product development, and transform industries along with his other Web3 technologies. While these technologies can bring benefits, they also warn that they can impact organizations that ignore Web3 features.

Other Tech Trends Covered by Bain

The comprehensive nearly 100-page report covers many other technological developments over the past year. Competing and winning in a multi-cloud world, scaling the Industrial Internet of Things, boosting sales productivity in a recession, consumption-based pricing, and chip shortages are all covered. Here are some additional facts from Bain’s report:

• In the race between cloud hyperscalers (AWS, Google Cloud, etc.) and multi-cloud infrastructure software vendors (Snowflake, Twilio, etc.), customers are already voting with money, with about 60% of AI/ML budgets going to hyperscalers. tools. compared to 25% of multi-cloud ISV solutions.
• For industrial IoT, the number of organizations implementing proofs of concept grew nearly 20% from 2018 to 2022, and is expected to grow another 20% by 2026.
• The future is bright for Software as a Service (SaaS) companies that adopt consumption-based pricing. His 80% of customers report better alignment with the value they get from consumption pricing. And nearly half of the software companies using it said it helped them win more customers.

methodology

Bain’s Technology Report 2022 is based on secondary market research, analysis of financial information obtained or provided by Bain and Company, and various interviews with industry insiders.

Read the full report from Bain.