Independent research commissioned by Claranet reveals that IT departments today are twice as likely to focus on cost reduction and technological support of employees as they are on those things that can grow the top line. Although a more strategically-focused IT department is expected to emerge over the next five years, a more substantive shift is needed to fuel the innovation agenda.
The pan-European research report, which surveyed 900 IT decision-makers from the UK, France, Germany, Spain, Portugal and the Benelux, from a range of mid-market organisations, found that the primary functions of the IT department are considered to be data security (56 per cent), technological support of employees (38 per cent) and cost reduction (34 per cent). However, just 16 per cent felt that making the business more competitive was a core function, while only 14 per cent identified increasing customer loyalty*.
According to Claranet, the results confirm that the average European IT department is some way off from arriving at Gartner's third era of enterprise IT, 'digitalisation' whereby the IT department continually provides new opportunities for growth, innovation and market differentiation.
Claranet's UK Managing Director, Michel Robert, said: "Increasingly, business success rests on the IT department's ability to develop applications and IT systems that deliver ROI by being agile and flexible enough to support new ways of doing business. But it's clear from the research that the average IT department is still more likely to be seen as a cost centre rather than as an enabler of business transformation and differentiation. While the research found that the IT department will become more strategic over the next five years, focusing more on expanding into new markets and executing new business models*, the era of 'digitalisation' will remain some way off for the majority.
"The role of IT services providers in facilitating the shift from keeping the lights on to business enablement cannot be understated. In today's economic climate, it makes absolute sense for existing IT staff to focus on higher value strategic work, while transferring the day-to-day management of IT infrastructure to a trusted partner who can provide higher levels of service through economies of scale and skill and deliver cost reductions as a result." he concluded.
*Q. What do you consider to be the core functions of IT departments at present? /
Q. Taking into account current technology trends, what do you consider will be the core functions of IT departments by 2020?
| Base: all respondents (Europe) | 2015 | 2020 |
| Accelerate introduction of new products/services | 18% | 18% |
| Acquiring new technologies to support business initiatives | 31% | 26% |
| Big data analytics | 26% | 34% |
| Contract management | 23% | 21% |
| Cost reduction | 34% | 31% |
| Data security | 56% | 50% |
| Enabling business agility | 29% | 31% |
| Enabling revenue generation for the wider business | 17% | 19% |
| Execute on new business models | 6% | 12% |
| Expand into new geographical markets | 8% | 13% |
| Having a distinct IT department | 10% | 8% |
| Improve supply chain efficiency | 11% | 11% |
| Increase customer loyalty | 14% | 13% |
| Inspiring business initiatives with acquisition of new technologies | 23% | 25% |
| Make us more competitive | 16% | 18% |
| Procurement | 13% | 11% |
| Setting frameworks for other departments to make purchasing decisions | 13% | 12% |
| Technological support of employees | 38% | 32% |
Methodology
In December 2014, independent market research company Vanson Bourne conducted Claranet's fourth annual survey to examine the use of managed services providers, and to gain insights into attitudes, experiences, and trends across the western European end-user communities. The research polled 900 senior IT and business decision-makers from enterprises and small-to-medium businesses (SMBs), from the UK, France, Germany, Spain, Portugal and the Benelux.
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