Organizational Restructuring and M&A Activities Lead Western European Utilities’ Business Initiatives, According to New IDC Energy Insights Study
(WK-intern) – MILAN – A new IDC Energy Insights study shows that Western European utilities are generally optimistic about their near future.
68.4% and 61.5% of smaller and medium respondents said they were optimistic, compared with 44% of larger utilities.
Key findings from the study include:
- Western European utilities have, over the last three to four years, made significant optimization efforts toward their maintenance and run operations, effectively bringing down costs, and enabling them to allocate more of the IT budget to growth and innovation activities.
- After a lifetime of preserving internal IT spending, Western European utilities have been actively externalizing their IT budgets, with over 41% of IT spending spent externally. 37.9% of Western European utilities plan to increase their external IT spending share further during the next 12 months.
- When it comes to ownership of external IT budgets, Western European utilities indicate that close to two-thirds of their external IT budgets are controlled by their IT departments. However, there is still an important 37% of external IT spending controlled by their line-of-business units.
- For IT budgets controlled by the various lines of business among Western European utilities, the top department spenders are marketing and communication, professional services (i.e., legal staff), and finance/administration.
- Western European utilities identified infrastructure constraints and scalability as the most pressing challenge for IT operations for the next 12 months, along with retention of talent.
- Western European utilities identified customer service/level of support and services and technical superiority and innovation as high-importance criteria when selecting an IT provider.
“The Western European utilities industry is facing rough times, and companywide budgets are under attack. Especially within IT departments, huge efficiency efforts are being driven to reduce the significant longstanding burden of run and maintain activities, with the aim of freeing up some budget for growth and innovation activities to become more competitive and efficient,” said Gaia Gallotti, research manager, IDC Energy Insights.
More insights are revealed in the IDC Energy Insights study What About Utilities’ IT Budgets? — Results From the Western European Annual Survey 2014 (IDC Energy Insights #EIOS09W, December 2014). The study discusses ICT budget spending distribution, key challenges for Western European utilities from an IT perspective, the leading business initiatives to support IT decisions, the criteria used to select IT vendors, and satisfaction with primary IT suppliers among utility enterprises in Western Europe. This is the second in a series of four studies on the survey covering utilities in Western Europe. The first study described the IDC Energy Insights survey methodology, the third will focus on IT software solutions and technology priorities, and the fourth will focus on IT investment priorities, budget allocation, IT solution investment plans, and new technology priorities.
About IDC Energy Insights
IDC Energy Insights assists energy businesses and IT leaders, as well as the suppliers that serve them, in making more effective technology decisions by providing accurate, timely, and insightful fact-based research and consulting services. Staffed by senior analysts with decades of industry experience, our global research analyzes and advises on business and technology issues facing the utility and oil and gas industries. International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology market. IDC is a subsidiary of IDG, the world’s leading technology, media, research, and events company. For more information, please visit www.idc-ei.com or email email@example.com.
PR: IDC Energy Insights