Making smart IT decisions: Simple steps small businesses should take for smart IT investments

As the overall IT industry starts to show signs of growth, small businesses -- often the last to display confidence -- are exhibiting cautious optimism as many anticipate increased IT investments in the next six months.

According to a recent report from Forrester Research, IT spending in the United States is expected to ramp up in the second half of the year with an estimated 19 per cent increase in computer equipment spending, 11% growth in software spending, seven per cent hike in communications equipment spending, and six per cent uptick in consulting services. As the overall IT industry starts to show signs of growth, small businesses -- often the last to display confidence -- are exhibiting cautious optimism as many anticipate increased IT investments in the next six months.

According to the most recent CDW IT Monitor, which has been tracking IT sentiment since the beginning of the recession, more than half (54 per cent) of IT decision makers at the small business level believe that investment in IT infrastructure helps their company's performance -- an increase of 10 percentage points since the same time last year. In addition, 46 per cent of IT decision makers at small businesses plan to replace or install software, up three per cent since the same time last year, while 34 per cent expect to invest in hardware in the next six months, an increase of four per cent since June 2009.

Hardware to drive IT spending growth in 2010

While the data is encouraging, this is an environment where any planned IT investment brings great responsibility. Those in charge of technology decisions will have a number of options to consider when determining which investments make the most sense. As small businesses begin to rebound in larger numbers, they will start to move forward with technology refreshes and begin to revamp their IT infrastructures to keep up with the industry's emerging trends.

According to Forrester, key drivers of corporate spending in the computer equipment segment include aging hardware fleets, new products from the likes of Intel and Advanced Micro Devices, and Microsoft Windows 7. That said, as small businesses finally feel comfortable enough to take technology refreshes off of hold, they will have a daunting task in deciding what technology should come first.For example, outside of computer equipment, server virtualization continues to be an attractive option for small businesses looking to stretch their IT dollars. A virtualized server environment allows users to maximize physical resources in the most efficient way possible, helping to increase server utilization, boost application availability and simplify deployment, ultimately resulting in a variety of technical, administrative and cost-saving benefits.

Cloud computing, using applications, services and computing power delivered over the Internet, is another industry trend that has been around for years but was previously seen as too great an expenditure for small businesses. Now, as it has become more affordable, the barrier to adoption lies in understanding the benefits of how the system can streamline operations for any size business. Beyond looking at larger organizations as case studies, IT professionals should make an effort to understand how enhancements to the technology can work with a business of their size.

In order to make the most of their limited IT budgets, and implement technology that increases productivity and maximizes return on investment, here are four questions that small business IT professionals should ask themselves before choosing a service, product or solution:

1. How would you define the technology and its potential impact on your business?

2. Is this a mature technology or will existing systems be obsolete in a matter of months?

3. What is the financial impact of the investment, both short and long term?

4. How complex will it be to implement the technology within the context of your existing systems and personnel assets?

Taking the time to answer these important questions will help businesses look beyond market trends to make sound, strategic investments that will cover long-term plans and help streamline day-to-day operations. Armed with sound answers to these questions along with information on how the latest developments in technology can change your business, the next step will be investing in the right technology to help your organization succeed.

Read more about pc in Network World's PC section.

Tags business issuessmbConfiguration / maintenanceNetworkinginfrastructure managementhardware systemsCDWinvestmentsData CenterSMB Networkingmanagementcorporate issuesIT investmentfinancial resultssoftwareForrester Research

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Matt Troka, CDW

Network World

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