CIO’s slow decision making on digital transformation to halt IT spending growth in India

IT and business service 2017Digital transformation may be a buzz word for IT decision makers including enterprise CIOs to grow their business.

But confusion over the outcomes of the investment in digital transformation and debate on the top priorities has the potential to slow the growth in India IT spending. Any change in IT spending will hit IT companies such as Microsoft, Cisco, HPE, Oracle, Dell EMC, Google, among others.

Analyst firm Gartner says India’s IT spending will grow 9.2 percent in 2018 as compared with 14.2 percent in 2017.

India’s IT spending will reach $87.1 billion in 2018 from an estimated spending of $79.7 billion in 2017.

The development indicates that Indian CIOs and other business decision makers are yet to figure out the impact of digital transformation that can make on the goal of any organization.

“IT buying landscape is changing. Digital business transformation is creating connected platforms and new industry revenue streams,” said Ganesh Ramamoorthy, managing vice president at Gartner India. “Organizations that are not creating new digital business models, or new ways to engage constituents or customers, are falling behind.”

India IT Spending Forecast (Millions of U.S. Dollars)

  2017 Spending Growth  percent 2017 2018 Spending Growth  percent 2018
Communications Services 31,320 7 32,426 3.5
Data Center Systems 3,086 5.6 3,181 3.1
Devices 27,795 23.2 31,403 13.0
Enterprise Software 4,988 17.9 5,749 15.3
IT Services 12,571 15.7 14,308 13.8
Overall  79,761 14.2 87,067 9.2

The annual growth in communication services will decrease to 3.5 percent in 2018 from 7 percent in 2017. This means mobile operators such as Airtel, Vodafone, Idea Cellular, BSNL, Reliance Jio, among others, need to give fresh thoughts to their marketing strategies and pricing plans.

Growth in IT services is set to decline to 13.8 percent in 2018 from 15.7 percent in 2018. Infosys, HCL, Wipro, TCS, Cognizant, and Tech Mahindra are some of the top IT service providers in the Indian IT market.

Growth in data center systems market will reduce to 3.1 percent in 2018 from 5.8 percent in 2017. Tech companies such as Cisco, Juniper Networks, HPE, Oracle, among others, are active in the Indian data center space.

Devices market growth will dip to 15.3 percent in 2018 from 17.9 percent in 2017. Apple, Samsung, Vivo, OPPO, Lenovo, Xiaomi, are the major device makers in India.

Enterprise software market in India will grow at 15.3 percent in 2018 as compared with 17.9 percent in 2017. SAP, Microsoft and Google are some of the enterprise software companies with active presence in the country.

Gartner’s Ganesh Ramamoorthy said Indian CIOs must urgently embrace digital transformation.

Gartner in another note said that IT spending in the Indian government sector is projected to reach $8.5 billion in 2018, growing at 8.9 percent from 2017 estimated spending of $7.8 billion.

Baburajan K

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