ICT budget and staffing trends in the Retail Industry - Enterprise ICT investment plans
This report presents the findings from a survey of 168 retailers regarding their Information & Communications Technology (ICT) budgets and staff allocation. The survey investigates how retailers currently allocate their ICT budgets across the core areas of ICT spend, namely hardware, software, IT services, communications and consulting.
Introduction and Landscape
Why was the report written? In order to provide a depth of insight into ICT vendors’ and service providers’ potential customers.
What is the current market landscape and what is changing? According to Kable’s survey, hardware has been receiving the highest allocation, garnering X% of the average ICT budget in 2012, however, retailers are fairly keen to invest in software, as X% of total ICT budgets are being allocated to this area in 2013, an increase of X% compared to 2012.
What are the key drivers behind recent market changes? The increasing demand for enterprise applications such as customer relationship management (CRM), and supply chain management (SCM) along with application lifecycle products are driving retailers’ investment in software as they look to streamline their operations and improve their time to market.
What makes this report unique and essential to read? Kable Global ICT Intelligence has invested significant resources in order to interview CIOs and IT managers about their IT Budgets. Very few IT analyst houses will have interviewed 160+ ICT decision makers in the retail industry in H2 2012.
Key Features and Benefits
Understand how ICT budgets are set to change in 2013 in terms of their overall size.
Appreciate how budgets are allocated across the core elements of ICT spend, including hardware, software, services, communications and consulting.
Learn how ICT money is being spent in areas such as the data centre, applications, IT management and the network.
Establish how IT staff are typically allocated within retailers.
Gain insight into with whom retailers plan to spend their ICT money.
Key Market Issues
Retailers have been making decent investments in hardware in 2013, primarily driven by the current transformation taking place in the retail sector owing to the increasing adoption of mobile devices such as smartphones and tablets as point-of-sale (POS) terminals.
According to Kable’s survey, retailers are allocating a significant percentage of their ICT budgets to internal project development and maintenance in 2012 and 2013 in order to introduce agility & transparency into their operations and support innovation.
Retailers are allocating a moderate proportion of their hardware budget to security technologies. The increasing adoption of mobile technologies, cloud computing and various digital payment modes requires retailers to be proactive in updating their security features.
As retailers are facing challenges relating to cutting costs, improving customer services, and integrating various functionalities and channels, they are planning to adopt on-demand software.
Analysing the data by size of respondent reveals that large retailers are placing more emphasis on investment in cloud services, whereas small and medium-sized retailers are spending more on desktop services and user support.
Kable’s survey reveals that retailers’ investment in communications is set to witness an increase of 1% in 2013 compared to 14% in 2012.
As retailers strive to streamline their operations and concentrate on their core competencies to improve their performance, they continue to invest in both in-house and hosted data centres, allocating of their ICT budgets to data centres in both 2012 and 2013.
Investments with technology (product) vendors are set to witness an increase in 2013, owing to the increasing adoption of advanced technologies like mobility, cloud computing, virtualization, and analytics.
With X% of total hardware budgets, network & communications equipment is also attracting reasonable investments as retailers are keen to develop robust network infrastructures which can support their multi-channel operations, and improve collaboration across their various shop floors/outlets.
According to Kable’s survey, retailers are allocating 22% of their total software budgets to software as a service (SaaS) in order to achieve scalability, better return on investment (ROI), and ease of management.
This report presents the findings from a survey of X large enterprises regarding their Information & Communications Technology (ICT) budgets and staff allocation. The survey investigates how large enterprises currently allocate their ICT budgets across the core areas of enterprise ICT spend, namely hardware, software, IT services, communications and consulting. The report also illustrates with whom large enterprises prefer to invest their ICT money, thereby providing visibility into the opportunities for ICT vendors and service providers. Trends in ICT spending are identified through to the end of 2013 following feedback from respondents on their forthcoming investment plans.
The survey was conducted in September 2012 via an online methodology, with respondents all having ICT decision maker responsibility (typically CIOs and IT Managers). Kable plans to repeat the survey in the second half of 2013, in order to monitor ICT budget changes on an ongoing basis.