Tuesday, June 26, 2007

NASSCOM Tracks IT Adoption

NASSCOM has announced the 2006 Study, titled "Tracking of the IT Adoption Study" conducted among IT heads and senior IT managers from about 292 companies in India, across multiple verticals. The study showed that the growth of IT adoption was on an incline, with both large and SME companies buying more IT.

The study indicated that the highest average IT spending for 2006 was for the BFSI vertical followed by the energy and utility segment. The rate of increase in the average spending in each of these verticals was expected to be in the range of 12-27%, making them the most likely highest spending sectors in 2007 as well.

The third sector which was projected to witness a considerable hike in its IT spend was the tourism and hospitality industry. Rs.18 crore of IT expenditure, in this sector, was projected to grow by 13%, placing it among the highest tech-spenders in India, in 2007.

Interestingly, 1 out of 4 companies in both large scale and medium scale organizations indicated that their IT budgets would increase by around 10-19% during the current year.

NASSCOM's findings revealed that business continuity and risk mitigation were the key priority areas for CIOs. Increasing efficiency and process productivity was the business goal achieved through IT adoption in 2006.

Also, it revealed that the CIO's role as the "business leader" and then as a "technologist" was not the current prototype. IT spends were driven by hardware, followed by application and network software.

The NASSCOM study made it clear that CIOs would need to ensure that the business value of IT was proven and delivered. According to the study, the business benefit would have to be proved up-front, and the means of measuring benefits of IT - by perhaps using an overlay IT-business balanced scorecard approach, or by mapping the benefits perceived and by pre-empting outcome scenarios.

This in fact, was stated to be a major CIO challenge, which required them to be more business oriented. The effort of mapping business benefits was immense, even though some CIOs had already started measuring IT advantages, juxtapositioning them as trusted business advisors.

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