Insights on the Business and IT Services Market

Gartner forecasts that enterprise IT spending will exceed $4.6 trillion in 2023. That’s an increase of 5.2% in constant currency. Of that, business and IT services represents about $1.4 trillion, which is the second largest area of technology spending (second only to telecommunications). Gartner’s quarterly update continues to forecast 8.5% growth for the year in constant currency terms (see Forecast: IT Services, Worldwide, 2021-2027, 1Q23 Update).One simple way of talking about the IT services market is to understand some of the players that compete for enterprise spending of business and IT services. Examples include firms such as Accenture, IBM, Capgemini, EPAM, TCS, HCL, Cognizant and Wipro, as well as the more management, strategy or process-driven firms such as McKinsey & Co., EY, PwC and KPMG. Interestingly, the largest firms in the world collectively only account for less than an estimated 25% of the market. In the last 25 years, none of the firms have had more than single-digit share. This results in thousands of midtier and smaller companies — a very large long tail of companies.In this podcast, Gartner VP analyst Sandra Notardonato shares her insights into the market dynamics of the overall sector. The primary reason that this sector is of interest to enterprises is that business and IT services are incurred by over 90% of all enterprises regardless of industry or geography. The strategy, design, deployment, system integration and ongoing management are critical enablers to any cost, growth or innovation-driven business goals.