For 2021, core tech spending growth will include increased digital adoption and ‘work-from-anywhere’ enablement.
With the economy gaining pace and large deals back on the table, chief executive officers (CEOs) of tech companies believe global tech spending will witness growth this year.
According to CEO Survey by Nasscom, about 71 per cent chief executives expect global spend to grow over 4 per cent.
The figure is significantly higher than the previous two years — 41 per cent and 59 per cent in 2019 and 2020, respectively.
The survey also said the recovery in global tech spending will be led by the digital segment.
For 2021, core tech spending growth will include increased digital adoption and ‘work-from-anywhere’ enablement.
The priority tech spending areas for 2021 are expected to be augmented reality and virtual reality (AR/VR). mixed reality, Internet of Things (IoT), artificial intelligence (AI), robotics and cloud.
Health care, telecom, BFSI and retail consumer are expected to spend the most in 2021.
The CEO survey from Nasscom covers CEOs from large and small Indian IT firms, global capability centres (GCCs) and start-ups.
The survey conducted between January and February saw responses from over 120 CEOs.
In terms of key themes for customer technology spending, the survey found that 92 per cent firms plan to increase digital tech spending.
There is a clear shift in focus from legacy/cost optimisation to front end customer experience.
Rather 20 per cent respondents said that there is an increased focus on building comprehensive digital organisations.
“What we found is that CEOs are much more optimistic about 2021, especially compared to last year. From deals perspective, while the traditional large multi-year deals are still happening, what is leading the growth momentum is the digital segment which is led by cloud migration,” said Sangeeta Gupta, senior VP and Chief Strategy Officer, Nasscom.
The pandemic has also changed the top three tech priorities for 2021.
Though cloud and advanced analytics continue to be the focus, cyber security is the third most important area.
For the Indian IT services players, cyber security as a service is an area where they have seen rising demand.
The global cybersecurity market is expected to grow to $282 billion by 2027.
Large digitisation deals, followed by growth in core markets especially Europe and Continental Europe will drive growth in 2021.
The survey pointed that digital transformation deals have seen a 30 per cent jump since the pandemic.
However, with growth coming back access to capability and right skills will need more focus matter as well.
Rather 56 per cent respondents said that they will increase their hiring by 10 per cent and 39 per cent said that they will grow more than 10 per cent.
As organisations move from services to platforms, build new business models and fast track inorganic growth, new talent capabilities will be in demand.
Close to 70 per cent CEOs said that they see gig worker accounting for upto 10 per cent of workforce by 2021.
With a focus on hybrid work models, 70 per cent CEOs expect remote workers to constitute 50 per cent of workforce.
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