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Cloud Computing Solutions and the IT Budget

This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet.


Cloud computing solutions may be disrupting today's IT budgets. New research has found that various technologies are affecting how much IT departments are spending.

Outsourcing Falls

A new survey by Computer Economics discovered that, for the second year in a row, IT outsourcing has fallen while new IT resources are growing. About 10.2 percent of companies' spending was allocated to outsourcing, a decline from 10.6 percent in 2013 and from 11.9 percent in 2012. Meanwhile, IT operational budgets rose 2.4 percent this year. Outsourced help desk, desktop support and application maintenance functions are on the decline, while IT security work and web operations services are seeing growth.

According to the results featured in ZDNet, IT managers want plug-in, ready-made services that are available thanks to cloud computing. They understand they can be ready with their solutions in just hours or even minutes. The study also pointed out that the classified use of software-as-a-service as a form of application hosting outsourcing is on the rise. The cloud is expected to continue to have an impact on both traditional outsourcing and in-house operations.

Investing in Infrastructure

Firms from all industries seek cloud computing solutions to increase collaboration and improve productivity; it is what IT professionals are budgeting for when investing in new infrastructure. At the end of the day, the benefits and risks of cloud computing affect how firms manage their IT infrastructure costs. Midsize firms often turn to public clouds since they do not have the same security risk and legacy IT restrictions as large enterprises.

When IT professionals at midsize firms aim for innovative cloud solutions, they aim to gain better-aligned technology spending that is in sync with business needs. At smaller firms, the money spent on IT is often aimed at maintenance and security areas, so it is easy to overlook the value of the cloud. IT professionals that fail to recognize the benefits of well-thought-out cloud strategies will not invest, and that can affect potential gains. By consulting with experienced cloud vendors, smaller firms can implement the right solutions that align with their business goals.

Spending Future

IT spending is outpacing outsourcing spending, and according to new research cloud has a lot to do with it. It is a trend that more midsize firms migrating to the cloud will see firsthand as the confidence in cloud solutions continues to take off in the marketplace.

This article was written by Marissa Tejada.

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