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Observations Of An IT Service Provider: IT Trends Of 2023

November 21, 2023
Reading Time: 4 mins
Author: Ray Sweeney

Last year in a similar post we outlined some common themes and trends for the year, and now we return for the IT trends of 2023.

Once again, while working with various SMBs we have seen some prominent themes and recurring topics.

Changes in cyber security requirements & adoption of new ERP systems have dominated talking points this year. In addition, we've noticed other trends and similarities across industries of which most businesses are unaware.

 

The Dual Personality of Cyber Security

In the past, cyber security was all about the risk to the business. The focus was on 'what if?' and the effects of a breach. For those who had previously suffered a breach, the impact was more easily quantifiable. For others, a very difficult scenario to put a number on.

This year however in the wake of the 2022 Optus breach, large corporations are putting more focus on the security of their suppliers, pushing cyber security compliance down the chain.

This push has undoubtedly come as a result of insurance companies raising the bar of requirements to obtain cyber insurance. Commonly businesses are now required to have various solutions, processes & policies in place to secure insurance.

This creates a dual personality or purpose for cyber security.

On one hand, the traditional risk assessment and management to protect business operations is still relevant and evolving quickly. SMBs need to do the right things to protect their organisations.

On the other, there is now a growing list of 'tick the box' requirements that many businesses need to have to secure new tenders, maintain existing contracts or seek out government funding.

Commonly these requirements do little to protect an SMB in a practical sense. Never-the-less they are beginning to incur very real damages in the form of overhead costs and missed revenue.

SMBs must consider these changes in 2024 to ensure that they are not on the back foot if something were to suddenly change. We have spoken with several organisations that have lost considerable revenue in 2023 as they were unable to comply with the sudden increase in requirements from their clients in time.

 

One [new] System to Rule Them All

Whether it's a backlog trailing the pandemic, a new willingness to accept disruptions or a focus on initiatives to improve efficiency to combat hiring issues, businesses are upgrading their systems.

There has been a notable increase in SMBs looking to update their ERP or CRM in 2023. In all cases, business state objectives to increase efficiency, clarity & reportability.

There are several common observations that we've made regarding these upgrades:

  • Whilst high-level goals of 'improved efficiency' have been set, very few can articulate objective measurables of what success will look like.
  • Very few ERP selections are being made eyes wide open. Businesses have not been informed and remain unaware of the knock-on effects of decisions they are making regarding security, custom integration work, additional spending and licensing implications.
  • ERP/CRM upgrades are being conducted separately from IT services & operations. If the goal is efficiency, systems and operations need to work in harmony to maximise ROI.

There can be a lot of unknowns when upgrading line-of-business applications. Many SMBs stand to waste a lot of time and commit themselves to future rework if they maintain their current course and speed.

 

The Absence of Advice is Putting SMBs at Risk

More and more we are finding SMBs to be poorly informed regarding their risks, capabilities and what's possible with new systems. A lot of faith is put into IT providers by business leaders to tell them what they need to know.

Many IT providers however are seemingly adopting the mantra that 'what they don't know can't hurt them'. In 2023 we commonly observed businesses significantly misled regarding their:

  • Cyber Security Stance & Preparedness
  • Infrastructure & Cloud Strategy
  • System Capabilities / ERP Upgrades
  • Ability to Reduce Overhead

Notably, the lack of knowledge concerning cyber security has led to an increased vulnerability for these businesses as they are not taking the necessary steps to protect themselves. Worse still, leaders are unreasonably confident in their existing protections which in reality provide as much safety as a seatbelt on an aeroplane.

This should not be seen as doom and gloom. However, any MSP that says you're completely covered is withholding vital information.

Similarly, a lack of advisory is costing businesses significantly. Poorly designed or timed upgrades, coupled with a lack of business-impacting recommendations are adding overhead at a time when businesses need to protect their profits.

Our Other IT Services

SMBs are Paying for Things They Don't Need

We've helped several businesses reduce IT expenditure & overhead by as much as 30-40% in 2023. In most cases, this was the result of providing additional strategy & advisory; providing solutions based on the business, rather than industry norms.

In other cases, it was far more simple.

The explosion of as-a-Service applications and subscriptions has made license management far more relevant in recent years, 2023 in particular.

A relatively simple set of routine processes has allowed us to save new clients on average 20% of their ongoing subscription costs. Simply ensuring old users are properly offboarded and that existing licenses are optimised provides surprising gains.

This practice is of course a microcosm of a broader opportunity. Without continual reviews & assessments, businesses are assigned the inevitable fate of their outgoings always expanding, never contracting.

Businesses and MSPs alike need to change their focus on what successful IT looks like. No longer should it be focused on function and availability, rather it should be focused on the value of returns.

Businesses would be well served to regularly ask the question, do we need this?

 

IT Trends of 2023: Conclusion

It's been an interesting year in the world of technology. Whilst 2023 has been a welcome return to normal, the long-term effects of the pandemic are still being widely felt.

Inflation, skilled labour shortages, and the adaptation of hybrid working environments have continued to raise challenges for SMBs.

Many have turned to increasing efficiency and reducing overhead as a means to meet the challenge. This is an area where IT has a large role to play. Businesses on the up are embracing a more mature approach to technology; one that's focused on returns rather than uptime.

If you'd like to know more about the IT trends of 2023, or would be interested in a discussion of your plans for 2024 we'd love for you to get in touch.

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