With 2022 just around the corner many organizations are planning and budgeting for the year ahead. IT should be part of that discussion. We would venture to say that with the changes organizations have had to implement and adapt to over the last two years, it is an important part of the budget discussion. The hybrid workforce, the cybersecurity landscape and persistent uncertainty will continue to influence IT budgets for SMBs in 2022.
Here are some of the factors that may influence the 2022 IT budgets.
1. Evaluate and Address Your Cybersecurity Risks
Several factors contributed to the pandemic having a significant effect on the rise of cyber threats. Factors such as remote and hybrid workforces, outdated systems and the increased adoption of cloud services led to an increase in vulnerabilities that needed to be addressed. Add the sophistication and persistence of cyberattacks to the mix and businesses really need to think about improving their cybersecurity posture.
Organizations need to ensure their budgets include addressing the vulnerabilities and gaps in their cybersecurity strategy.
2. Multi-Factor Authentication (MFA)
While we preach a multilayered approach to cybersecurity and always recommend an assessment to see where the organization stands with their cybersecurity posture, multi-factor authentication has gotten quite a bit of attention over the past year.
The first, multi-factor authentication has been proven to prevent some of the most common and successful cyberattacks. According to Microsoft, it is 99.9% effective in preventing account compromise attacks. Yet, many organizations have yet to implement MFA. Or, if they have, they are not enforcing it. In fact, if your business is applying for or renewing a cyber insurance policy, not having MFA or a proper implementation of MFA is a deal breaker.
Again, we highly recommend an assessment to determine your security exposure and to identify any gaps, but MFA is definitely a “must have” during your budget deliberations.
3. Technical Debt Management
Although we would all like the technologies we use to last forever, that is not the reality. Manufacturers are always working on improvements to performance and functionality to provide better solutions. As technology ages, it eventually, reaches end of life (EOL). There are security, operational, opportunity, and financial implications for continuing to use EOL technology for an organization. These include:
- The technology no longer being supported by the manufacturer. This means they stop providing technical support, upgrades, bug fixes and security patches. This makes the technology vulnerable to cyber attacks and can compromise systems that are connected to the aging technology.
- As technology ages it becomes prone to failures and the failures multiply the longer the technology is used past it’s EOL. The cost of maintaining and keeping obsolete technology operating increases over time.
- As the legacy systems age, they stop communicating with more modern technologies.As well, fewer and fewer people have the technical expertise to manage these outdated systems which creates productivity and operational risks to the organization.
- Aging technology may hinder an organization’s ability to achieve its business goals and compete in industry they operate, and this creates an opportunity risk
Under investing in critical IT infrastructure and applications creates what has become known as technical debt. With all the changes that businesses have implemented over the last few years, it’s important to look at your technology stack to determine if budget should be set aside to reduce the security, operational, opportunity, and financial risks associated with running EOL equipment and software.
The two remaining factors that may influence the 2022 IT budgets have less to do with technology and more to do with sourcing and procurement of equipment and applications.
4. Equipment Delivery Lead Times and Price Increases
We had been dealing with computer chip shortages pre-pandemic and the situation became an even bigger issue once the pandemic hit with a widening gap between supply and demand and significant supply-chain disruptions. The result is major delays and price increases for notebooks, printers, firewalls, monitors and other IT equipment. The delays can range from several weeks to several months or more. This situation is not expected to improve in 2022.
The best way to deal with this situation is to be proactive by forecasting your equipment needs, keeping the delivery delays and pricing volatility in mind.
5. Price Increases
Although we talked about pricing volatility above, it is always a good idea to include manufacturer price increases due to inflation and/or product improvements. For example, we already know that Microsoft has a planned price increase for Microsoft 365 that is effective as of March 1, 2022. In their case, there has not been any product price increase that is not due to inflation or currency adjustments since the release of Office 365 1o years ago. Since then, they have added over 20 applications to the suite and have improved security and operational efficiencies which has led to the price increase.
In any case, budgets should always include the possibility of manufacturer price increases to ensure a more accurate forecast of IT expenses.
There may be other considerations when planning your IT budget for 2022 depending on market or industry. MicroAge can help you with your budgeting exercise by providing guidance that will prioritize your IT spend and maximize your IT budget. Contact us today.