LIFE 2 - The significance of ICT in enterprises

The question of the significance of ICT for business and society is not only an economic issue, it is just as important in a business management context. Information and communication technologies not only play an essential role for entire industries and sectors, they are equally important within individual enterprises. As part of the LIFE 2 Study, the 1,559 ICT executives were also asked about the strategic importance of ICT in their company.

Figure 3-4: Strategic relevance of ICT today and in 5 years time

Figure 3-4: Strategic relevance of ICT today and in 5 years time

Strategic relevance
A total of 79 percent of the executives rate the strategic importance of ICT for the success of their company as very high or high; in the United Kingdom it is 87 percent, and 77 percent in Germany, or slightly more than three-quarters of the participants. For the future the ICT executives expect the importance of ICT to rise even further: Internationally, around 84 percent of the surveyed executives state that they expect the strategic relevance of ICT to increase (strongly) in their company in the next five years (see Figure 3-4).

The future importance of ICT is rated as being particularly high in research & development, logistics, and customer services. In total, 70 percent of the ICT executives believe that ICT will play a (very) important role in R&D in the future; 66 percent of the executives believe that ICT will play a (very) important role in the two corporate areas logistics and customer services.

Against this background, with the importance of ICT rising steadily, it comes as no surprise that six out of ten ICT executives (58%) expect a (strong) increase in their company’s IT budget. Three in ten (33%) expect budgets to remain unchanged. Only nine percent of ICT executives expect budgets to be cut.

Figure 3-5: ICT and competitive ability

Figure 3-5: ICT and competitive ability

Great significance for corporate development
ICT executives believe that the greatest influence that ICT will have on their enterprise’s ability to remain competitive in the future will be by increasing performance (72%) and achieving cost savings (70%) through ICT, as well as knowledge management (69%) (see Figure 3-5). In this connection, the participants of the think tank noted that the debate on building competitiveness must not be limited purely to cost-savings and exploiting the cost-cutting options that are available, and neither should ICT be limited to the status of a tool for reducing costs. At the heart of competitive skills and ability lies the enterprise’s innovative capabilities, and these are often also the result of its use of ICT.

“ICT is often viewed merely as a tool to cut costs, but in reality it is the innovation potential opened up by ICT that determines an enterprise’s future competitiveness.”
Professor Roman Beck, Goethe University Frankfurt

Figure 3-6: Influence of ICT on innovation and competitive ability

Figure 3-6: Influence of ICT on innovation and competitive ability

This opinion is obviously shared by the ICT executives in the big enterprises. Overall, more than two thirds of the executives surveyed (67%) believe that it is through the lever “Innovation” that ICT will have the greatest influence on their enterprise’s future competitiveness. In the United States 76 percent of the executives who participated in the survey believe this (see Figure 3-6). And in Spain and France the innovative potential of ICT and the significant influence of this area on competitiveness is also acknowledged: Innovation is seen as one of the top 3 areas with a (very) strong influence on competitiveness. In contrast, German ICT executives believe that the biggest effect that ICT has on their enterprise is in the areas flexibility, efficient process design and customer service.

Enterprise mobility, i.e. the integration of ICT solutions in the enterprise, is one of the key future trends in IT for three in ten executives (mentioned by 30%). Mobility is rated particularly highly in Spain (36%) and France (31%), but in Germany, the United Kingdom and the United States mobility is mentioned by more than one in four of those surveyed as one of the top 3 future fields in ICT.

 

Virtual collaboration is mentioned by 23 percent of ICT executives as one of the three most important IT trends in the next few years. In France 31 percent rate it as a top topic, and 28 percent in Spain. In the United Kingdom it was a top topic for one in five ICT executives (20%) and in the United States for almost one quarter (24%). The German executives bucked this trend: Only 13 percent of those surveyed considered virtual collaboration particularly important. Another topic that belongs under the general heading “Collaboration” is “open innovation”. Just like virtual collaboration, open innovation was recognized as a trend in France and Spain. One in four ICT executives in France (23%) and Spain (25%) believes that open innovation will be one of the top topics in the next few years. In the United Kingdom, Germany and the United States only 14 or 15 percent believe that it will be a key future trend.

 

In these countries the focus is more obviously on boosting flexibility, for instance through flexible sourcing or the use of cloud services. One in four of the executives surveyed in the United States (25%) and one in five in Germany and the United Kingdom (22% each) believe that cloud computing will be one of the three top trends in ICT in the next few years. Flexible sourcing is considered a future trend by around 19 percent of executives in Germany and Spain, and 23 percent in the United Kingdom.

Key IT trends in the next few years

So where is ICT heading? Which key trends and topics can we expect when it comes to how information and communication technology shapes and changes our world of work? Which topics will influence the economy most? Our think tank experts believe that flexibility, mobility and collaboration will have a prime influence on shaping our future. Christophe Châlons, Chief Analyst of the PAC Group, sums up: “Flexibility, mobility and cooperation are the three big change issues”. This is backed up by the results of the survey of ICT executives.

“Flexibility, mobility and collaboration are the big change topics.”
Christophe Châlons, Chief Analyst of the PAC Group

Enterprise mobility, i.e. the integration of ICT solutions in the enterprise, is one of the key future trends in IT for three in ten executives (mentioned by 30%). Mobility is rated particularly highly in Spain (36%) and France (31%), but in Germany, the United Kingdom and the United States mobility is mentioned by more than one in four of those surveyed as one of the top 3 future fields in ICT.

Virtual collaboration is mentioned by 23 percent of ICT executives as one of the three most important IT trends in the next few years. In France 31 percent rate it as a top topic, and 28 percent in Spain. In the United Kingdom it was a top topic for one in five ICT executives (20%) and in the United States for almost one quarter (24%). The German executives bucked this trend: Only 13 percent of those surveyed considered virtual collaboration particularly important. Another topic that belongs under the general heading “Collaboration” is “open innovation”. Just like virtual collaboration, open innovation was recognized as a trend in France and Spain. One in four ICT executives in France (23%) and Spain (25%) believes that open innovation will be one of the top topics in the next few years. In the United Kingdom, Germany and the United States only 14 or 15 percent believe that it will be a key future trend.

In these countries the focus is more obviously on boosting flexibility, for instance through flexible sourcing or the use of cloud services. One in four of the executives surveyed in the United States (25%) and one in five in Germany and the United Kingdom (22% each) believe that cloud computing will be one of the three top trends in ICT in the next few years. Flexible sourcing is considered a future trend by around 19 percent of executives in Germany and Spain, and 23 percent in the United Kingdom.

Figure 3-7: Importance of ICT - key IT trends Zoom inZoom in  Figure 3-7: Importance of ICT - key IT trends

Figure 3-7: Importance of ICT - key IT trends Zoom inZoom in Figure 3-7: Importance of ICT - key IT trends

The ICT executives list a few more issues they believe are key trends in ICT, and as interdisciplinary technologies these apply to ICT in general. These general trends include IT security (mentioned by 54%), business intelligence (31%), green IT (29%) and strategic IT alignment (15%) (see Figure 3-7). In Germany the issue of IT security is a focal topic for executives: Two-thirds of German executives (66%) view IT security as one of the top 3 topics for the coming years. In the United Kingdom and the United States around 50% of respondents listed IT security as a top topic for the future.

Green IT is another issue that is taken seriously by the executives surveyed: In total, 29 percent of the executives surveyed thought that green IT would be one of the most important topics in the next few years. In France and Germany green IT was rated as the second most important issue with 35 percent and 31 percent listing it respectively. In the United States green IT was the third most important topic on the executives’ future agenda with 32 percent listing it, in the United Kingdom it came in fourth position (28%). Green IT was less important in Spain: With only 18 percent mentioning it, green IT appears in fifth place on the list of the most important IT future trends.

Significance at individual job level

At job microlevel ICT is also rated as very important: In total, more than three-quarters of all IT users surveyed (77%) state that ICT plays a decisive or very important role for their everyday work. In Germany 81 percent of IT users hold this opinion. 79 percent of all IT users state that they depend on the Internet and telecommunications for their present job.

79% of IT users depend on the Internet and telecommunications in their present job.

The new technologies change the way we work, where we work and how we communicate at work. For example, one in four of the IT users (28%) state that they can no longer keep their professional and private lives strictly separate. In Spain and the United Kingdom 30 percent said that this separation was no longer possible. One in five (21%) often works from home, nearly as many (19%) frequently work while on the road, e.g. at the airport or on the train. Around 42 percent of all IT users surveyed are convinced that mobile working brings or would bring career benefits – an opinion shared by one in two of IT users in Great Britain. For every second user (54%) it is important or very important to be able to access the necessary information and programs anywhere and at all times, i.e. to have mobile access to these programs and information. The significance of mobile work is particularly high in Spain, where around 70 percent of the users surveyed state that mobile work was especially important.

54% of users consider it important or very important to be able to access essential information and programs anywhere and at all times, i.e. have mobile access.