What IT services executives see as the outlook for 2014.

What IT services executives see as the outlook for 2014.

We were interested in what IT services executives were thinking about their outlook for the year, and where they felt they were well positioned for growth, or not so much.

We conducted a quick brief, informal survey among IT services firms. Now the statistical pursuit might quibble with the fact that the number of respondents totaled 35, but the expressed sentiments are very much in keeping what we hear every day. With that here is what we’re hearing:

  • IT Industry in 2014: Two-thirds of executives are optimistic going into the year, while 29 percent are looking to an average year.
  • Company Growth Rate: Fifty-three percent are anticipating a healthy growth rate (15-25 percent), 29 percent are looking to be OK (5-15 percent) and 12 percent are expecting a bountiful year with growth over 25 percent.
  • Company Net Profit: Forty-four percent are looking for 10-15 percent net profit, 29 percent are anticipating 5-10 percent net profit, and 21 percent are looking for net profit of more than 15 percent.
  • Challenges: Respondents ranked their companies’ challenges from most to least important: 1) revenue/profit, 2) talent, 3) new customers, 4) competition, and 5) vendor relationships.
  • Key Growth Strategies: Respondents ranked their companies’ key growth strategies from most to least important: 1) organic growth, 2) entering new verticals, 3) M&A, 4) new software partners and 5) entering new geographies.
  • Company Rating: Respondents rated their companies in different categories on a scale of 1 (excellent) to 5 (troubling): 2.2 for talent, 2.3 for market position, 2.4 for delivery prowess, 2.7 for financial position and 3.3 for sales and marketing prowess.
  • Vendor Impact: When assessing vendor impact, 59 percent of respondents don’t expect any impact negatively or positively, while 35 percent expect positive impact.
  • Cloud Impact: When assessing how they feel the move to the cloud will affect their businesses, 53 percent expect a positive impact, while 41 percent expect a negative impact.
  • Talent Impact: When assessing the technical talent shortage, 50 percent say it’s a big problem, 26 percent say it won’t have an impact and 24 percent see it as an opportunity.

Most of what is on the minds of executives for 2014 is people-oriented. The most important challenge, as always, is generating incremental revenue and profit. Partners need to get new customers organically, improve the sales and marketing apparatus, and pursue and upgrade technical talent.



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