Information technology systems crucial for business success SAP/EMA Innovation for Growth Survey reveals

ERP, security ‘most important’ right now; open source, RFID and Vista ranked lowest Next 1-3 years: financials, sales force, business intelligence software highest priority; carbon emissions, outsourcing ranked lowest

Auckland, New ZealandThe inaugural SAP/EMA Innovation for Growth Survey reveals the importance of IT to the success of New Zealand businesses. Sixty-five percent of respondents see IT as an investment that actively supports their business success. The survey was commissioned by SAP and conducted by the Employers and Manufacturers Association Northern (EMA) in September 2008 as the global financial crisis started to unfold.

Fifty-three percent of respondents describe IT as essential for the smooth functioning of their business; 29 percent see it as essential to gaining and maintaining sustainable competitive advantage; and 22 percent regard it as a primary plank in their growth strategy*.

When asked to specify what kinds of IT investments were most important to their company at present, upgrading ERP systems was the clear leader: 25 percent of those surveyed ranked investment in ERP system upgrades as the highest IT priority – and a further 10 percent ranked it the second most important. IT security initiatives were ranked most important by 19 percent and second most important by a further 17 percent.

Ian Black, managing director SAP New Zealand, says that the survey revealed that businesses in New Zealand clearly perceive IT as an integral part of their businesses’ efforts to achieve operational excellence and competitive advantage.

“The survey respondents had clear strategic plans for investing in IT for their businesses. The priority placed on ERP system upgrades clearly indicates their recognition of the role information systems play in delivering efficiency improvements, particularly in a slowing economy,” says Ian.

“During an economic slowdown, small tweaks in how a business operates can make a big difference to profitability. Evidently New Zealand businesses understand the strategic role of their information systems during a slowdown.”

Additional Findings

  • When asked more specifically about which software and software services will be important to meeting their organisation’s objectives over the next 1-3 years 61 percent of respondents identified financial management software as important – 16 percent more than the next most important category. *
  • Other IT services and software rated as important to meeting objectives over the next 1-3 years included sales management software (45 percent), business intelligence/business performance management (44 percent) and web services (44 percent).
  • Software to monitor carbon emissions (8 percent) and outsourcing of software services (10 percent) were least likely to be rated as important by the survey respondents.
  • Contrary to the perception that IT systems force businesses to change how they operate
    22 percent of respondents said IT systems had enabled them to formalise existing business processes and 13 percent had simply automated their existing processes. A further 11 percent did have to change their processes significantly but found the change ultimately benefitted the business.
  • Forty-one percent of respondents were influenced by their customers when it came to advice about investing in technology, 32 percent were influenced by their partners and only 23 percent were influenced by their suppliers.

“Financial management software is obviously the backbone of a business,” says Ian Black. “Sales management or CRM and business intelligence are strategic investments, showing how New Zealand businesses use IT.

“There is also a clear recognition of the role played by partners, customers and suppliers in selecting IT systems. It’s a pre-condition for effective collaboration which reduces costs and enhances revenue growth, as well as improving business relationships. Business Network Transformation (BNT) technology will be critical for those businesses looking to stay ahead in these uncertain times.”

SAP/EMA Innovation for Growth Survey

The SAP/EMA Innovation for Growth Survey was conducted during September 2008. A total of 365 business owners/managers responded. The largest proportion (30 percent) were from small businesses with fewer than 10 full time staff. Sixty four percent had revenues less than $10m in 2007 and 63 percent had no export component to their business. Further detailed information about the full findings of the survey is available in the media release titled: New Zealand businesses preparing for tough times but remaining positive.