A shift in the focus of IT investment points towards growth in service-led models, observes the latest GE Capital Capex Barometer. This trend is also reflected in the growing popularity of leasing, suggested the company.
After strong increases in capital expenditure on IT hardware and software in 2014, UK SMEs appear to be shifting their investment focus towards operational expenditure to boost productivity, finds the report.
It also predicts that spending by UK SMEs on IT hardware is set to halve from £10.1bn in 2014 to £5.3bn in 2015. Capex investment in IT software is also set to drop from £7.8bn in 2014 to £4bn this year.
Over a third (34%) of respondents say they are not investing in new hardware or software this year because they have recently upgraded, suggesting a natural cooling-off point in the investment cycle.
However, GE Capital's research also points to a refocusing on people and operational efficiencies as businesses look to maximise their investments.
UK SMEs are planning to create a record 737,000 jobs in 2015 while two in five of those investing in IT hardware and software are doing so to enhance efficiency and productivity (39% and 41% respectively).
For many businesses, flexible financing solutions such as leasing are also proving attractive to SMEs looking to upgrade IT systems, relative to more traditional types of finance.
When investing in IT hardware, for example, 29% plan on using a specialist lender or leasing provider as their preferred method versus less than a quarter (22%) preferring a high street bank.
Gabriele D'Uva (pictured), UK MD for Equipment Finance Business at GE Capital, said: "2015 could be a watershed year as investment preferences shift towards service-led IT models.
"We are also seeing this trend in the way technology is financed. An increasing number of businesses are looking for more flexible ways to help them keep up with the latest technologies, with the emphasis on usage value rather than ownership.
"This explains why leasing, which offers the flexibility to maximise the value of equipment over the life of a financing agreement, is growing in popularity."