Macroeconomic Centre of Excellence
Winds of change can be defined as external forces shaping the market, either we are considering the whole market or the IT market. These forces have been in place for several months and years: at the beginning they were thought to be transient and not connected, but the current scenario proves it wrong.
As time pass, winds of change are becoming storms of disruption. Storms of disruption have four main features
They are company-specific, i.e., they affect companies differently, even if in the same industry
They are not temporary, i.e., they are here to stay, although they might change form
They are not standalone, i.e., they do not come alone
They are all interconnected, i.e., they influence and exacerbated each other
Storms of disruption impacting European organizations
63% of European orgs have created specific scenarios relating to the macroeconomic environment which would trigger pre-established adjustments of their 2023 budgets if they occur
Source: IDC European MacroEconomics Center of Excellence, 2023
Inflation Impact as a Common Denominator across Regions Exchange Rate, Supply-chain, Energy are hot European areas
Which of the following risk factors related to your organization’s tech strategies and budgets for 2023 concerns you the most? – Overall Rank
| Worldwide | North America |
Asia Pacific |
Europe | Latin America |
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| Inflation |
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| Impact of recession on expected business revenue |
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| Currency Fluctuation |
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| Supply-chain constraints |
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| Labor Shortages |
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| Managing Demand for Cloud in line with Budget Plans |
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| Energy Shortages |
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| Geo-political Turmoil |
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Source: Future Enterprise Resiliency & Spending Survey - Wave 1, IDC, January 2023. N = 985
Investment in Software will keep total ICT spending resilient to macroeconomic headwinds
February 2023 ICT Spending Outlook in Europe
Source: Black Book Live Data v. February 2023 (in Current Annual USD)
Inflation & Interest Rate Fear Awakened but Unemployment gives Positive Signs
Source: IDC European MacroEconomics Center of Excellence, January 2023
Managing the Storms of Disruption in EMEA: IDC's Midyear Tech Market Checkpoint and Recommendations
This IDC Web Conference provides a 2022 midyear overview of the EMEA ICT market landscape. According to recent IDC research, 71% of EMEA organizations' digital leads believe current market volatility and uncertainty will continue through much of 2022 and early 2023, affecting their business and digital plans for the months ahead.
Top 3 Regulatory Concerns of European Organizations for the Next Two Years
European organizations expressed their concerns and the impact the believe they will face from Regulations in the coming years of 2023 and 2024, when ask about it in the European Enterprise Acceleration Survey (n=1500). The survey was conducted in late 2022 and we found that the top three priorities for European organizations are in the domains of Cybersecurity, Data Governance and Sustainability.
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Navigating the Storms of Disruption in a Digital-First Europe
Several storms of disruption are blowing over European organizations from ongoing pandemic, to supply constraints, skills shortages, exceptional inflation, Russia-Ukraine war-driven concerns, and evolving energy shortage scenarios. In front of these Winds of Change, technology plays a key role in enabling business resilience while fostering acceleration opportunities.
Supply chain constraint
Skills shortage
Cybersecurity
Inflationary pressuer
Russian Invasion of Ukraine
Sustainability
Digital sovereignity
Consumer digital demand
New digital business model
Digital innovation
Industry digital ecosystem
Pandemic management
Biotech impact
Government stimulus
Regulation and policies
DIGITAL RESILIENCY
Only 15% of European organizations are anticipating being fully digitally resilient over 2021/2022.
Source: European Future Enterprise Resiliency – Wave 2, 18-28 February 2021 (n= 610)
Operations
37% of European organizations are adjusting their operations with an external focus on partner/customers/ suppliers to coordinate and (better) respond to market changes
Leadership & Organizations
34% of European organizations describe their leadership style as “some empowerment.” Whilst major decision-making follows a top-down approach, employees are somewhat empowered to make decisions and create self-directed teams if needed
Brand & Reputation
37% of European organizations are still developing a privacy policy and approach.
Financial
30% of European organizations have a limited coordination between the internal finance function and the broader ecosystem, as they mostly coordinate with a limited group of traditional stakeholders (e.g., investors, banks and creditors)
Customers & Ecosystems
31% of European organizations are still in early stages of being able to manage customer journeys
Workforce
Only 13% of European organizations believe their workforce has widespread access to the resources they need to work remotely.