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ASEAN firms seen to hike IT innovation budget by nearly 40%: IDC

Veronica C. Silva | Sept. 6, 2012
Decision-makers are beginning to see the importance of innovation to drive business.

Corporate budgets for IT-led innovations in the Asia South market are seen to increase next year due to rising operation costs and increasing pressures to engage customers on new platforms.

A recent IDC survey showed that such investments in the markets of Indonesia, Malaysia, Singapore and Thailand are expected to reach an average of 39.8 percent in 2013.

Commissioned by CA Technologies in July 2012, the survey sought 120 IT C-level executives as respondents. The respondents were "as either primary decision makers, or those who influence their organisation's ICT investment decisions."

Traditionally, the allocation for IT innovation follows the 80/20 principle with only 20 percent earmarked for related initiatives. Daily operations and maintenance costs usually receive the lion's share of 80 percent.

This year, however, the focus on innovation exceeded expectations as the average budget went up to 38 percent from 20 percent.

Effectiveness a key objective

"The Asia South market has demonstrated a mindset shift in terms of its strategy on IT- led innovation," IDC said.

The market research firm also noted virtualisation, security, mobile, cloud, and green IT as the "top technologies" being considered for further investments by Asia South for 2012 and 2013.

"IDC believes that organisations need to first achieve a level of effectiveness in harnessing IT, followed by aligning IT with business priorities, before driving IT-led innovations to achieve desired outcomes," said Sandra Ng, group vice president, Practice Group, IDC Asia/Pacific.

Of the respondents, 70 percent cited business process transformation as an IT-led innovation that their organisation is presently investing in. Furthermore, 75 percent of CEOs or CIOs in Asia South are seen as enablers, champions or experts on innovation. On the other hand, only 25 percent assume no major role or are even seen as "barriers" to innovation.

IDC sees the survey results as indicating a promising sign because lead stakeholders in Asia South assume a pivotal role in pushing innovation in their respective companies operating within a predominantly top-down culture.


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