COVID-19 IMPACT SURVEY MAY 2020
As COVID-19 continues to spread and cause large scale human and financial destruction in countries across the world, pessimism is beginning to run high among chief information officers(CIOs). The general decline in business confidence is an indication of the gradually worsening economic climate, since business confidence is a well-known leading indicator of future output. Business confidence, in other words, is a barometer of investment growth. As companies revisit their Investment spending plans, its little surprise that IT budgets are being slashed. IT budgets which in the pre-pandemic period was projected to grow by over 4% to 5% supported largely by enterprise software spending is now set for downward revisions. Virtually every technology company is facing financial challenges of disrupted supply chains, and falling work-from-home (WFM) employee productivity. Inability to meet quarterly revenue targets mean reduced available funds for planned IT projects.
The pandemic is throwing up a fairly mixed bag of challenges and opportunities for IT services and technologies. While planned IT projects and budgets are disrupted for companies across all industrial vectors, dependence on certain other technologies are growing. These include Artificial Intelligence (AI), automation, cloud computing, remote working, block chain, and other work from home (WFH) technologies like remote collaboration, remote desktops, VPN, network security, among others. Spending on technology for remote working is witnessing rapid increases as companies make a forced migration to these platforms to ensure business continuity. Major focus of current budgets will therefore be spent on ensuring seamless yet secure operations remotely. In line with this trend, reductions in software investments will be the lowest at -1.5%, hardware the highest at -13.2%, while infrastructure may remain afloat at 1.5% largely because digital innovation is the way out of the crisis. Post COVID-19 challenges such as reduced worker density; non-contact production; cost reductions; innovation; agility to respond to supply disruptions will require re-doubled focus on enabling technologies.
Currently however, larger companies with the financial strength to withstand the recession will maintain investments in automation, while smaller and medium companies will cut-back on spending to survive the current economic nightmare. Immediate cash flow and liquidity remains the biggest challenge for the global Supervisory Control and Data Acquisition (SCADA) market which is projected to reach a revised market size of US$15.5 billion by the year 2027 after a -8.2% decline in the year 2020.
Given that SCADA is the backbone of automation, remote monitoring and control of industrial systems, the market will nevertheless post a quick recovery in the coming year. SCADA is defined as an industrial automation control system used to remotely control and monitor complex process and operations in industrial plants, and infrastructure in manufacturing plants. SCADA is a software application program that helps in collecting data/information from remote locations in real-time to control conditions and equipment. SCADA also helps in controlling several industrial processes including production, manufacturing, power generation, fabrication, desalination, refining, and transportation in both process and discrete manufacturing sectors. The SCADA systems are also capable of interpreting the data gathered from different sources. These systems find applications in a range of industrial sectors including oil & gas, power, water & wastewater treatment, pharmaceuticals, transportation, manufacturing, chemicals, telecommunication, and food & beverages, among others.