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IT Priorities 2020: ASEAN firms on the frontline of digital transformation

Southeast Asian companies plan to spend more on infrastructure and cyber security, but the growth in IT budgets appears to be slowing down

Southeast Asia’s booming digital economy is spurring enterprises across the region to double up on driving technology change to compete with more nimble startups.

According to the 2020 TechTarget/Computer Weekly IT Priorities survey, 44% of nearly 200 respondents in ASEAN cited digital transformation as their top priority, followed by infrastructure modernisation (41%) and cyber security (36%).

The priorities are not surprising, given that more enterprises are coming under pressure to remain competitive in the face of digital disruption across industries, such as financial services, logistics and telecommunications.

That said, the growth in overall IT spending appears to be softening, probably over concerns about the slowing global economy. In 2019, 80% of respondents expected a bigger IT budget, while just 61% expect to spend more this year.

As in previous years, 2020 will see more ASEAN firms investing in their core technology foundation to support transformation efforts. In the datacentre, 38% of respondents will continue to invest in on-premise infrastructure, with an equal number stating their preference for hybrid cloud.

This will be supported by automation, security and monitoring tools, which about one-third of respondents will invest in, not only to keep the lights on but also to pave the way for agile software development.

Indeed, the proportion of respondents who will spend on agile project management software doubled from 21% in 2019 to 42% this year, underscoring firms’ growing resolve to build in-house software development capabilities to gain an edge over their rivals.

These development efforts are largely geared towards internet of things (IoT) applications (37%), signalling that the technology is finally catching on in the region, followed by microservices (32%). And, as expected, investments in application programming interface (API) management tools remains high (53%) on the agenda to support development and co-creation initiatives.

On the storage front, spending on cloud-based storage remains strong, with four out of 10 respondents putting it as their top priority. The appetite for flash-based storage appears to be tapering off, however, with just 7% of respondents planning investments in the technology this year.

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With a highly mobile and young workforce that embraces mobile technology in all aspects of their lives, ASEAN’s investment in mobile device management (MDM) tools is relatively higher, with nearly 40% of respondents planning investments in unified endpoint management solutions.

At the same time, 35% of ASEAN enterprises are rapidly moving ahead with Windows 10 migrations, given that Microsoft has ended support for Windows 7. Those that are still using Windows 7 could become ticking time bombs for cyber security, which 36% of respondents will spend more on in 2020.

The quest for new software development capabilities does not mean enterprises are weaning themselves off packaged software. For many large enterprises, financial applications and other enterprise resource planning (ERP) systems remains core to their operations. That is why nearly 40% of respondents are looking to shore up investments in ERP applications, which will need to be upgraded to support digital transformation initiatives. 

Increasingly, these applications are likely to be delivered as cloud-based services, driving investments in networking technologies such as software-defined wide area networks (SD-WAN). According to the survey, SD-WAN topped the list of networking priorities in ASEAN as more companies look to speed up delivery of cloud services.

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