Brexit Leaves Organisations Split On IT Spending

Steve McCaskill is editor of TechWeekEurope and ChannelBiz. He joined as a reporter in 2011 and covers all areas of IT, with a particular interest in telecommunications, mobile and networking, along with sports technology.

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New research suggests IT directors are split between spending big before Brexit or waiting to see what happens with EU negotiations

One of the biggest concerns among the IT industry ahead of the EU referendum last year was that a vote for Brexit would lead to lower spending as organisations grappled with the prospect of life outside the bloc. 

Of course, the result was a narrow victory for Leave, and according to new research from technology service provider Avanade, IT directors are similarly split on what strategy to employ in a post-Brexit world, especially given the current political uncertainty. 

More than half (56 percent) say they are accelerating IT projects so they can be completed as quickly as possible in case of a doomsday scenario, however 40 percent feel the best strategy is to wait and see what happens by slowing down or even cancelling projects altogether. 

EU Brexit referedum

Brexit IT spending 

Two thirds of respondents said the surprise result of the General Election in June left them feeling a need to re-evaluate their strategy but most have decided not to make any changes. Most are continuing as normal, but there is a greater focus on cost-cutting. 

Indeed, 55 percent think their IT is in a good position ahead of Brexit and some even feel that Brexit will eventually be a good thing, acting as a catalyst that will give them an advantage over competitors who have stood still on technology. 

“Brexit has helped remove some of the barriers IT directors sometimes face when it comes to building the business case for these projects,” said Darren Hardman, UK GM for Avanade. “The current window of opportunity is not going to stay open forever. Most IT directors recognise that the budgets being made available today may not be accessible in two years’ time.” 

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The technology industry largely opposed Brexit, as did Silicon readers, and that position is unlikely to have changed following a standoff in negotiations between Britain and the EU. There are also ongoing fears regarding investment, the economy and access to skills and markets. 

There is however the prospect that some of the uncertainty could be eased by Prime Minister Theresa May’s speech in Florence today where she spoke of a proposed transitional period before Brexit takes effect.

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