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ICT investment trends in energy

ICT investment trends in energy

Summary
The energy sector has been affected by plunging prices, economic slowdown in emerging economies, and geopolitical change and instability, leading energy companies to adopt cost cutting measures to increase the efficiency and monetary return from the existing infrastructure. As a result, energy companies have taken a step towards improving ICT policies and initiatives.

Key Findings
Kable’s survey reveals that hardware and software are the prime areas of focus among energy companies.
Energy companies are making considerable investments in data center facilities and service desk functionality.
‘Increase customer satisfaction’, ‘survival’, and ‘competitive advantage’ is the most important business objective influencing the IT investment strategy of energy companies.

Synopsis
ICT investment trends in energy presents the findings from a survey of 114 energy companies regarding their Information & Communications Technology (ICT) investment trends. The survey investigates how energy companies currently allocate their ICT budgets across the core areas of enterprise ICT expenditure: hardware, software, IT services, communications, and consulting. The report illustrates the core technologies that energy companies are investing in, including security products, IoT, cloud computing, and network services. The survey also highlights the approach to purchasing technology adopted by energy companies. Through Kable’s survey, the report aims to provide a better insight to ICT vendors and service providers when pitching their solutions to energy companies. The report focuses on energy companies ’ ICT expenditure trends for specific business areas and technologies, identifying the top three IT projects, and understanding the business challenges faced by organizations.

In particular, it provides an in-depth analysis of the following:
How ICT budgets are set to change in 2016 in terms of their overall size
Allocation across the core elements of IT spend, including hardware, software, services, communications, and consulting
Distribution of ICT money in areas such as the networks, applications, service desk, and data centers
Which ICT functions energy companies are interested in outsourcing
Energy companies’ investment priorities based on their budget allocations across core technology categories such as security products, IoT, cloud computing, and network services
Factors that are influencing energy companies’ investments in each technology category
How energy companies’ IT budgets are currently allocated across various segments within a technology category
Energy companies’ distribution of their ICT budget across various segments within a technology category
Vendor satisfaction ratings for various core and advanced technology categories
Insight into energy companies’ preferred buying approaches
Business objectives that energy companies are looking to achieve through their IT investment strategies
Factors that are influencing energy companies’ decisions to select an ICT provider

Reasons To Buy
Understand how the energy companies’ ICT landscape is set to change in 2016 to prioritize your target market
Comprehend how ICT money are being allocated by energy companies in specific geographies and size bands to improve your market penetration
Make effective business decisions by recognizing the opportunities within each of the core areas of ICT spend (hardware, software, IT services, telecommunications, and consulting)
Realign your sales initiatives by understanding the current strategic objectives of energy companies
Enhance your market segmentation with the included, detailed breakdown of opportunities within selected technology categories (security products, IoT, cloud computing, and network services)
Prioritize your focus areas by understanding which factors are influencing energy companies’ decisions when selecting an ICT provider
Understand the changes in customers’ priorities and identify the business objectives that energy companies are looking to achieve through their ICT investment strategies


1 Trends in ICT budgets
1.1 Introduction
1.2 Survey demographics
1.3 ICT budget changes
1.4 ICT budget allocation by core technology area
1.4.1 Hardware budget breakdown
1.4.2 Software budget breakdown
1.4.3 Third party IT services expenditure
1.4.4 Communications expenditure
1.4.5 Cloud computing budget
1.5 ICT budget allocation by function
1.6 Outsourced IT functions
2 ICT investment priorities and vendor satisfaction
2.1 Introduction
2.1.1 Security products
2.1.2 IoT
2.1.3 Cloud computing
2.1.4 Network services
3 ICT procurement trends
3.1 Introduction
3.2 Business objectives influencing IT investment strategy
3.3 ICT provider selection
3.4 Key decision maker for purchasing technology
4 Sector-specific trends
4.1 Introduction
4.2 IT expenditure plans for specific technology areas
4.3 Technology areas receiving the largest investments
4.4 Business challenges
5 Summary
5.1 Price fluctuations, economic slowdown, and geopolitical instability is leading energy companies to invest in ICT to increase efficiency
6 Appendix
6.1 Definitions
6.2 Further reading
6.3 Contact the authors
List of Figures
Figure 1: Energy companies - ICT survey geographic breakdown
Figure 2: Energy companies - ICT survey breakdown by size band (number of employees)
Figure 3: Recent and expected ICT budget changes among energy companies
Figure 4: Energy companies’ (external) ICT budget allocation, 2015 and 2016
Figure 5: Energy companies’ average hardware budget allocation
Figure 6: Average allocation of software budgets in energy companies
Figure 7: Energy companies’ average IT services budget allocation
Figure 8: Energy companies’ average communications expenditure
Figure 9: Energy companies’ average cloud computing budget allocation by technology
Figure 10: Energy companies’ average cloud computing budget allocation by implementation type
Figure 11: Energy companies’ ICT budget allocation by function, 2015 and 2016
Figure 12: Outsourced IT functions – Energy companies’ current and future outsourcing priorities
Figure 13: Security products – Energy companies’ current and future investment priorities
Figure 14: Security products – selected primary provider and vendor satisfaction among energy companies
Figure 15: IoT – Energy companies’ current and future investment priorities
Figure 16: IoT – selected primary provider and vendor satisfaction among energy companies
Figure 17: Cloud computing – Energy companies’ current and future investment priorities
Figure 18: Cloud computing – selected primary provider and vendor satisfaction among energy companies
Figure 19: Network services – Energy companies’ current and future investment priorities
Figure 20: Network services – selected primary provider and vendor satisfaction among energy companies
Figure 21: Business objectives which influence energy companies' IT investment strategy
Figure 22: Factors influencing energy companies' decision to choose an ICT provider
Figure 23: Role of key entities in making ICT purchasing decisions
Figure 24: IT expenditure plans in 2016 compared to 2015, for specific technology categories within energy companies
Figure 25: Top three IT projects in 2016 for energy companies
Figure 26: Importance of the following business challenges for energy companies

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