European businesses to spend their IT budgets on strategic applications in 2005

IDC surveyed European IT managers in regards to their budgeting goals.

Around 48% of respondents consider corporate management and IT departments to be the most influential in the final decision for the implementation/enhancement of important IT solutions. This trend applies to all verticals except banking, where the corporate strategy department is perceived as the most important business function for the implementation/ enhancement of important IT solutions by 41% of respondents. Just over 50% of respondents are using external consultants to support their IT decisions, but there are significant differences between verticals. 71% of banks rely on external consultants, while this falls to 34% in the discrete manufacturing sector. Apart from banking, 50% of respondents in process manufacturing, transport/telecoms/media/utilities, and government are using external consultants.

The decision time needed tends to be shorter for hardware technologies and longer for more strategic projects such as outsourcing or system integration. The area with the fastest purchase decision process is network hardware; for more than 44% of respondents the purchase decision process for network hardware is less than one month. For 37.7% the main area of focus during 2004 is to develop and/or implement new strategic applications to improve the organization’s competitiveness. This is particularly true for the banking, insurance/other finance, and business service sectors. Still, controlling costs will be the key area of IT focus in both discrete and process manufacturing.