March 8, 2005, New York, NY – A major report based on a series of interviews with 305 senior IT managers and 298 business executives from the Canadian headquarters of companies across the country conducted by Ipsos-Reid, Canada’s market intelligence leader, reveals that pressure to cut costs means that Canadian businesses plan to spend 4.4% less on IT in 2005, although companies will allocate additional funds to outsourcing.
The total amount spent on outsourcing is expected to increase by 5% overall, from 44% in 2003 to 49% in 2005, and by 6% over the same period in the application services sector. The trend towards outsourcing will have a significant impact on what strategies work best to maximize buyer investments in IT over the next 12 months.
�The coming year appears to be crucial for providers to solidify existing customer relationships and address any potential weaknesses that may expose competitive vulnerabilities,� says Lise Dellazizzo, Vice President of Ipsos-Reid�s Information Technology Practice. �Vendors may need aggressive strategies to capitalize on a buyer environment that is shifting towards outsourcing.�
In her white paper �2005 IT Vendor Roadmap to Buyer Dynamics,� Dellazizzo examines the results of research into four IT markets: applications, services, hardware and infrastructure and security. �The survey provides invaluable insight from business and IT leaders across the nation into IT investment and spending, outsourcing, and technology integration issues.�
The research revealed that a high percentage of companies are experiencing significant technology challenges: 31% of companies revealed that they were unable to integrate new applications with existing technology; the cost of integrating technology with systems and networks was a chief challenge for 35% of companies; and the most prominent challenge overall when integrating new and existing technology was the lack of process and systems integration expertise, according to 43% of companies.
Top-line findings from the survey also showed that three out of four companies invest in IT without having performed a return on investment (ROI) or total cost of ownership (TCO) analysis prior to investing. �Assessments are a valuable tool that provide clarity into what a company is spending and where dollars are being spent, thus helping decision leaders formulate sound technology investment strategies based on firm analysis,� says Dellazizzo. �Most companies who take the time to analyze ROI or TCO implement valuable changes as a result.�
Ipsos-Reid
Ipsos-Reid is Canada’s market intelligence leader and the country�s leading provider of public opinion research. With operations in eight cities, Ipsos-Reid employs more than 300 researcher professionals and support staff in Canada. The company has the biggest network of telephone call centres in Canada, as well as the largest pre-recruited household and on-line panels. Ipsos-Reid�s Canadian marketing research and public affairs practices are staffed with seasoned research consultants with extensive industry-specific backgrounds, offering the premier suite of research vehicles in Canada�including the Ipsos Trend Report, the leading source of public opinion in the country�all of which provide clients with actionable and relevant information. Ipsos-Reid is an Ipsos company, a leading global survey-based market research group.
To learn more, visit: www.ipsos.ca
