Distribution’s Role In A Recession

Rich Hume, TD Synnex

It’s coming. It’s not coming. It may be coming. We know a couple of things for sure. Interest rates are going up. Inflation is beginning to decline. The Fed does not like the fact that the job market is so hot. And so there‘s a lot of dynamics going on. We say we try to stay away from being economists, because that’s not our profession.

[If there is a recession], the first thing you have to have an appreciation for is that, regardless of the economic cycle, within IT there‘s always value and there are always categories of areas that are in demand under any circumstance. The first important thing is, we’re privileged to have a very large portfolio. And as economic cycles impact some of those areas, and perhaps not others, we have the opportunity to make sure we‘re transitioning our sales engagement or energy to where there is demand. So I think it’s really important to recognize that large portfolios, be it geographic or offering, are things that help to insulate a little bit as opposed to being concentrated in one area or the other. The second thing is, the market in total has a set of technologies that have better growth attributes: cloud, analytics, IoT, cybersecurity, hyperscale infrastructure. We‘re really making sure that we’re doubling down on those areas that will have greater than the average growth of IT. And then third, like every other business, you start to take preventative and precautionary measures in making sure that you‘re very conscientious about controlling costs or discretionary spending, and then being a bit more cautious as it relates to resource increments.

Dan Schwab, D&H

I don‘t have a crystal ball to speak about the recession. I think economists were created to make weathermen look good. I think none of us know. But I would say within our industry, I don’t believe there‘s a recession at all. In fact, I believe that some categories maybe overswung the pendulum during COVID and now maybe have a rebalancing. But generally speaking, IT is so pervasive in our personal and professional lives that we continue to invest more there, are not less. So the whole learning from home, work from home, hybrid workforce, requires more technology. Whether it’s endpoints, whether it‘s the network, whether it’s the cloud, whether it‘s new opportunities for service providers from a security standpoint, none of that goes backwards. So I believe when companies are looking at their costs, they’re actually leaning in more on technology because they‘re using that to take costs out of the equation, differentiate themselves from their competitors, or optimize their workforce. And I don’t think there‘s any recession in IT. If anything, I’ve never been more bullish. I think it’s going to be the golden years for technology opportunities for the next five or 10 years.

Paul Bay, Ingram Micro

I‘m not an economist. And you can tell that the people that are the experts don’t necessarily agree either. So we‘re looking at it really from what are the business outcomes that the solution providers need and where the opportunities are from an end user perspective. I think one of the key elements we need to focus on, and you’ve heard us and others talk about it, is what‘s the opportunity for solution providers to find areas to free up and allow them to invest in the future. And so part of that is really understanding those end users and where those opportunities are, with those end users, to help be a better business partner. [At GTDC, you heard the University of Denver CIO] talking about, ‘Look, I’m not going to just rip out what I have today. But I need to figure out how I can free up what I‘m using today more cost effective, so I can invest in the future.’

We‘re really focused around what we’ve done around digital and making that experience a focus on the customer. We‘re still from a cloud standpoint making investments in cloud. And then the whole circular economy with our IT asset disposition of products so that as your products are coming out, how to recycle and repurpose and reuse that technology. So we’re focusing on the growth areas. You heard [here] there is no budget for security because nobody’s going to allow security to bring a company down. Externally we’ve heard different growth rates, but we‘re still seeing solid demand from a cloud perspective, and we’re still seeing in as-a-service more and more looking to go from the capex to the opex model, so how can we help facilitate that?