New research from Advania, a leading Microsoft partner, has revealed a glaring problem for mid-market organisations in Northern Europe: they’re overspending on the wrong tech mix with no clear way out.
Independent research firm Censuswide conducted a survey of 966 mid-market IT Decision-makers across the UK, Sweden, Denmark, Finland, Norway and Iceland. Mid-market executives feel ignored with most believing they are overspending on technology unsuited to their business needs.
The findings come as company insolvencies hit their highest level in the UK since 2009 and mid -sized organisations in particular face higher borrowing costs, post-pandemic debt and increasing inflation. IT budget cuts are inevitable, yet despite mid-market organisations knowing where they are overspending, the survey reveals they don’t know how to cut. Asked how they spend their IT budget today vs in an ideal world, they would change almost nothing.
Lost in the Crowd with Outdated Tech
Mid-market organisations feel undervalued - almost one in four, 24%, feel big tech offers a transactional over supportive relationship. This neglect has tangible consequences as 29% think their vendors only provide products rather than appropriate solutions.
Dan Coleby, Director of Client Technology Value, Advania remarked “Our research sheds light on a perceived disconnect between mid-market organisations and big tech which means many mid-market organisations are failing to realise the transformative potential of big tech solutions. Bundled products and services can streamline operations, optimise costs, and accelerate growth for mid-market companies. Harnessing this potential requires strategic direction and expert implementation, which is where trusted technology partners play a crucial role in assessing the tech you use - and don't use - today.”
Almost a third of those surveyed, 31%, grapple with maintaining outdated software. The mid-market doesn't have capacity to manage its current tech stack, let alone look at updating processes and investing in new tech. It's juggling a ballooning budget for tech it doesn't want, it doesn't know how to get the most value out of big tech bundles.
This, coupled with 32% overspending on inflated licensing fees and the absence of customised options for smaller budgets, 29%, paints a picture of a fragmented and inefficient tech ecosystem draining resources and hindering progress.
Scaling Problems Beyond Budgets
The mid-market feel their tech stack is not futureproofed as 30% have a lack of budget to actually scale. This problem is coupled with the fact that 23% are facing an uphill battle to convince their boardroom of the long-term business benefits of digital transformation, their decision makers are stuck in the past with little knowledge of where’s best to put their money. Scaling up is also about more than securing funds, it begins with internal education. 26% of the UK mid-market believe there is a lack of skillset to achieve scalability in their desired timeframes, worsened by the fact that 98% of the mid-market cannot retain an excellent IT staff member for more than two years.
