2014: Technology and the Global Economy
HP:
HP’s fiscal year 2013 showed similar revenue results, down by single digits. It had lower revenues in all regions and printing supplies slipped 4 percent year-over-year. Printing supplies have been one of HP’s internal leading economic indicators, so this isn’t good news.
IBM:
IBM’s third-quarter revenues came in 4 percent under the previous year’s quarter, with all geographies down slightly or flat. But its growth-market revenues fell by 9 percent and the BRIC revenues declined by 15 percent. There’s a pattern here.
The collapse of revenues in emerging markets and BRIC nations is less a story of the bellwethers but of the countries’ declining economies. These countries and the U.S. were the engines of growth. Not any longer.
The Options
There are a number of global economic minefields lurking in 2014. We may be able to avoid them but the risk exposure is there. Therefore, it’s highly likely that most CEOs and CFOs will want to constrain IT spending (i.e., flat, down or up slightly). Most budgets are reflections of the prior year’s budget with modifications to address changing business requirements and the economic environment. Therefore, information technology executives can expect to have limited options as they work to meet new business demands, keep up with technology and develop the skills needed to satisfy corporate requirements. This means its time to innovate, do more with less again and/or find self-funding solutions.
