More Business Executives Will Direct IT Spend

Dec. 10, 2012
More than half of new IT investments in 2013 will involve direct participation by line of business executives.

Manufacturers should consider 2013 a “staging year” to prepare for new levels of business productivity required for the intelligent economy, said analysts from IDC Manufacturing Insights during a webcast on predictions for the coming year. Furthermore, new industry solutions will dramatically shift who the Information Technology (IT) buyer is. IDC research indicates that 58% of new IT investments in 2013 will involve direct participation by line of business executives, and that IT will have tobuild the foundation for business-led investment, delivering services rather than projects.

With that in mind, within the next five years, IDC predicts the following:

∙ IT shops will eventually offer a published service catalog, and half of those will use market pricing.

∙ Process productivity – at least half of all corporate standard processes will have automated data acquisition. At least a quarter will have self correction capabilities. On board service revenue will double its share of total industry revenue.

∙ Ecosystem productivity – Manufacturing companies should add 200 basis points of profitability by eliminating coordination waste in their ecosystem.

∙ Individual productivity – measurement systems will be in place to evaluate not just how prolific individual contributors are, but also how much their content is used. Information delivery will become more visual, tactile, and portable.

∙ Management productivity –companies should be able to double their revenue without adding any net new management personnel.

In the meantime, homegrown applications will be replaced by packaged applications, and these projects are set for funding. According to The Economist, the main reason third quarter profits fell for the first time since 2009 is that companies have been stockpiling cash instead of investing in growth. “Firms in the S&P 500 are currently sitting on top of a $900 billion “cash mountain,” it stated, with 40% more than they had on the books before the recession hit in 2008.

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