Looking to cut IT budgets? Sweating your assets won’t help in the long-run

Author: Maurice Suter, Head Of Business Transformation at Stone, A Converge Company

Fluctuations in IT budgets and spending have been difficult to forecast and predict in recent years. Analysts couldn’t have foreseen the rush for businesses to invest in enterprise technology as the pandemic took hold in early 2020. And once through the main period of the pandemic, spending reduced. Last year, according to Gartner, saw a contraction of 0.2% in IT spending, dropping to $4.38 trillion. This year, as high inflation continues to be a pressing issue for governments and businesses around the world, costs for hardware, software and labour have all increased meaning businesses are naturally looking to make cost-cutting efficiencies wherever they can. And it seems that whereas IT decision-makers are looking to in fact increase spend in ERP, CRM and other SaaS products, spending on devices is being squeezed. The same Gartner study is forecasting an 8.6% decline in devices spending this year, meaning the lifecycle of devices is being significantly lengthened.

Yet neglecting to refresh devices and cutting spending in this area can have far-reaching consequences for businesses.

The threat of cyber-attacks

The average lifespan of a business computer or laptop is three to five years. It is tempting to ‘sweat’ assets if there’s no clear signs that an upgrade is required. Yet taking this approach can lead to a plethora of costly issues in the future.

In April 2023, the UK government’s Department for Science, Innovation and Technology issued its ‘cyber security breaches survey’, analysing data from UK business for the previous 12-month period. The survey found that “32% of businesses and 24% of charities overall recall any breaches or attacks from the last 12 months. This is much higher for medium businesses (59%) and large businesses (69%).” These stats should be a wake-up call to businesses everywhere that preventative measure need to be in place.

Using out-of-date IT equipment and hardware will make your business more susceptible to attacks from viruses and malware. Old devices often lack support for the latest security updates and operating systems, and both are crucial for safeguarding your business and its data. The UK’s National Cyber Security Centre offers guidance around ‘out of date’ assets. The centre warns businesses against the risk of continuing to use ‘obsolete’ products because a) the product will no longer receive security updates, and b) the latest security mitigations are not present. Both issues will only compound the risks associated with a cyber security breach stipulating that this will make the risk of an attack more likely because relatively low-skilled attackers will be able to infiltrate the system.

The largest technology brands contribute to this situation, too. When Microsoft announced that Windows 11 would only support 8th-generation CPUs and newer chips, it meant that some of its most popular devices would be unable to run the latest operating system – something we’ve seen before in the tech industry with the likes of Apple and its strict update policy, which places an expiration date on which devices can run the latest version of iOS.

Reduced productivity

Reducing spend on new technology doesn’t just increase the risk of cyber-attacks. It can also cost your business millions when it comes to slowing down employee productivity. We have all been in a situation in the workplace where a system is frustratingly slow or an update takes an age to complete. The spinning ‘wheel of death’ is a common phrase heard in offices everywhere.

According to research from Curry’s, office workers waste on average 24 days every year due to delays caused by slow or out-of-date hardware. And this isn’t just damaging to a business’s bottom line. Employee satisfaction will drop if the belief that investment in cutting-edge new equipment, which will help them do their jobs better and faster, is not being prioritised. This will ultimately harm staff retention and impact how valued employees feel.

Prioritising the devices themselves needs to be a key consideration for IT decision makers. The latest and fastest devices should enable the innovation and security features you want to embed in your business, eliminating the risk of unnecessary and costly disruption. Ultimately, sweating your IT assets will only lead to fatigued, overwhelmed and strained employees.