Close to three quarters of high tech leaders think their revenue will increase in 2023. This optimistic survey comes after months of reports about big tech companies laying off staffers referring to the economic downturn and less tech demand after the pandemic when people locked up at home demanded more tech services and entertainment.
“Despite the current economic uncertainty, 72% of high tech leaders in the US, Canada and Western Europe have plans to grow revenue in 2023, according to the survey by marketing and research firm Gartner.
Close to half of the leaders believe they will be able to outperform their competition this year.
The survey was conducted in the second half of 2022 among 195 respondents in the US, Canada, the UK., France and Germany to understand how economic turbulence poses challenges to general managers, how confident they are in their ability to achieve their plans and the measures planned to tackle the uncertainty.
“Outperforming the market through an uncertain market requires an above average ability to execute on revenue ambitions,” says Mark McDonald, Vice President at Gartner. “The survey results indicate that almost half of firms (46%) do not have a sufficient ability to execute to reliably realize their revenue goals.”
The survey says that many technology leaders entered 2023 prepared for a potential recession.
“Paradoxically many of the actions taken concentrated on reducing costs rather than focusing on growing revenue and market relevance”, Gartner says:
- 55% slowed down hiring
- 52% implemented spending costs across the board
- 43% divested from unprofitable solutions
- 43% reduced marketing spending
- 34% reduced investment in products or services
- 28% froze internal spending
- 16% reduced prices
Gartner forecasts overall IT spending will grow 2.4% in 2023, with enterprise IT spending projected to grow 4.1%.
“The context of IT spending is changing as buyers increasingly value and make investments in business outcomes rather than buying solutions.”
“Changes in context challenge the relevance of technology solutions. Lower relevance reduces willingness to pay and renew relationships. Gartner sees relevance as the connection between a provider’s solution and how applicable it is to current customer needs. That connection exists at every level from the C-level to individual developers. Without relevance, we see sales cycles extend and renewals at greater risk,” says McDonald.