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October 4, 2015

How $billion energy companies invest in IT

Research: Kable Global ICT Intelligence unveils how the billion-dollar energy sector invests in IT.

By Joao Lima

Multibillion-dollar energy businesses look to align IT with overall business goals when investing in IT.

Analysis form Kable has found that companies in the energy sector which have revenues of $1 billion or more see aligning IT with overall business goals as the top IT objective when investing.

Respondents gave the mentioned objective a rating of 3.1 out of 4. This was followed by a drive to better demonstrate the value of IT to the business with a score of 3.

The surveyed companies from around the world rated delivering new functionality to business users, meeting internal service level agreements and the use of IT to support revenue growth as their third objectives, all with a rating of 2.8.

In addition, the research company has unveiled that these businesses invest nearly 60% (59.8%) of their ICT budgets on running existing systems and applications.

The multibillion-dollar energy companies taking part in the research said the remaining 40.2% of their ICT budget is allocated to expenditure on new IT projects.

As for next year, respondents said they plan to invest 1.9% more on new IT projects, with a total 42.1% of their ICT budget being driven towards this route.

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Expenses with running existing systems and applications will be down to 57.9%.

In addition, Kable also asked the firms how they split their ICT within different functions such as data centres, network and applications.

This year, the biggest slide of energy organisations’ ICT budget has been allocated to network (18.5%) followed by data centres (17.3%), end-user computing (15%) and service desk (14.4%).

Respondents also said that 14% of their budget is directed towards management functions with communications and applications receiving the least funding at 11.6% and 9.3% respectively.

Looking into next year, the surveyed energy companies are planning to invest less on network (17.1%), service desk (14.3%) and management (13.2%) functions.

Applications are set to see the biggest rise at 1% to 10.3%. The data centre slice of the ICT budget will see an increase of .6% to 17.9% and become the overall top investment for companies.

Respondents said that spending with communications will also grow .6% to 12.2%, followed by end-user computing functions which will see a budget increase of .1% to 15.1%.

All figures come from Kable’s ICT Customer Insight survey, which polled 2685 respondents, from across the world in Q4 2014. The survey findings include data on ICT budgets between ‘run the business’ and ‘change the business’ expenditure, ICT budgets by function and importance of various IT objectives in influencing IT investment strategies. Subscribe to Kable here.

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