Study Shows European Businesses Preparing For Economic Upturn

Paris, May 22, 2002 — IDC and Microsoft have revealed new data indicating that European businesses are preparing for an economic upturn through strategic IT investments that better position themselves for future success.

The joint studyof European enterprises confirmed that 82 percent are currently maintaining or increasing IT spending, with over half of these (43 percent overall) increasing investment levels compared to a year ago. The number one reason cited for IT investments is to improve business efficiencies and processes; achieved today primarily through advances in the areas of
“collaborative systems”
“systems to integrate existing infrastructures,”
as noted with 59 percent of the respondents.

Consistent with the current economic climate, 41 percent of respondents say that the need for IT systems to deliver rapid return on investment is critical to securing funding for IT projects today. Against this backdrop, the data reveals that European leaders today are realizing increased benefits from IT in areas which directly contribute to the bottom line. The number of respondents stating that Internet technologies and software have enabled their organization to increase customer reach, market share, revenues and profitability increased by a factor of between 1.7 and 2.8 in each of these areas, year over year.

The research was carried out in Belgium, France, Germany, Italy, Sweden and the United Kingdom among 550 senior business decision makers, all with companies having at least 500 employees (52 percent of the companies have over 1,000 employees). It examines key business issues faced by European enterprises and provides insight into how their business and technology priorities have changed in the past 12 months.

Preparing for the Upturn: Integration is Key

The two top investment categories, integration and collaboration, enable organizations to become agile, with improved communications between customers, suppliers, partners and employees. According to Simon Witts, Vice President Sales & Marketing for Microsoft Europe, Middle East and Africa (EMEA),
“The acknowledgement by Europes business leaders that Internet technology and software delivers concrete returns is encouraging, but even more so is their recognition of the need to invest more strategically by leveraging existing assets. By focusing on increased connectivity and getting their disparate systems to talk to one another via standards like XML, companies are getting fundamental business processes automated now, to help them realize their full business potential as the economy recovers.”

Complementing this trend towards increased connectivity is progress within the area of mobile technologies, where 61 percent of European organizations have already implemented solutions to enable employees to work remotely or become more mobile.

Key business drivers of tomorrow

Although the economy was cited as the No. 1 driver affecting businesses this year, 52 percent of respondents indicate that they expect a more positive economic climate in the next 12 months. Meanwhile, 87 percent still consider information technology as a key business driver today, up almost 10 percent from 2001. Almost a quarter of respondents, the largest single group, said technology would regain the No. 1 position in the next two years and the economy would revert back to the No. 2 position.

Says Richard Robinson, Consulting Director at IDC,
“Although in the current climate, the resolve to maximize value and focus on the bottom line has become acute, its important to remember that no one ever increased market share by cutting costs alone. The research shows that IT has become a tool to achieve business goals and is no longer seen as a goal in itself; key criteria for IT investment are more strategic today than in the technological push a few years back, and we expect this trend to continue.”

NOTE: Editors wishing more information on the study should contact (media only):
Microsoft EMEA Press Office:
Telephone: +44 (208) 434-5587


IDC Press Office
+44 (208) 987- 7169

Related Posts