p. fehér - z. szabó - hope? analysing enterprise it practices in hungary, 2009-2013

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Presentation on the 10th International Symposium on Business Information Systems, Győr, Hungary IT department of the Hungarian enterprises had to deal with several challenges in the last 5 years of the economic crisis: inevitable cost reduction, crisis solutions, limited IT development opportunities. The Corvinus University of Budapest conducts a research since 2009 among IT conscious enterprises, analysing the change of IT budgets, applied crisis solutions, development areas, perceived role of IT, IT strategy, IT infrastructure and service management practice. Beside using survey results, the practice of selected enterprises was explored via case-study methodology, therefore research results are based on both quantitative and qualitative methods. Research results indicate a patience waiting behaviour of the enterprise, and showing a hopeful attitude. In the case of IT budgets, close to 40% of enterprises applied no change comparing to the last year’s budget, and additional 50% changed it only slightly, even increasing or decreasing the volume. As average, the size of IT budget is practically did not change. Comparing to the last 4 years, this is a first year, where no average decrease in IT budgets were found, although there is no sign of growth. In this situation there is no need for exceptional crisis measures: decreasing salaries of IT employees or layoffs are far not so common as before. The goal of most widespread measures is to enhance internal effectiveness, including better business case development, more conscious financial analysis of IT projects, renegotiating supplier contracts and rationalising IT services. The planning period of IT strategies did not change over the researched years: it is still around 3 years, while ~80% of the enterprises have formal IT strategy. The most targeted development area is still related to IT operations, enhancing operational practice, among two-thirds of the enterprises. Mobility developments becase second and 45% of enterprises indicated plans on this area. Meanwhile enterprises plans fewer projects in other areas. Cloud-related developments dropped by almost 50% comparing to last year, and IT service management plans are also decreased to 26%

TRANSCRIPT

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

HOPE?ANALYSING ENTERPRISE IT

PRACTICES IN HUNGARY

2 0 0 9 - 2 0 1 3

Dr. Péter Fehér

pfeher@informatika.uni-corvinus.hu

Dr. Zoltán Szabó

szabo@informatika.uni-corvinus.hu

Partners:

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

The economic crisis is still not over –

at least not in Hungary

Source:

Fehér, P (2009) The Challenge of IT in Downturn,

OGIK Conference, Győr

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

IT Budget

Partners:

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

2009 2010 2011 2012 2013

3 Years Delay in the Stabilization of the IT Budgets

-8,1%

-1,1%

1%0,5%

-0,50%

-11,3%

-4%

-1,8%-2,9%

0,01%

International Hungary

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

3% 4%

24%

39%

26%

2% 3%

0%

10%

20%

30%

40%

50%

60%

Decrease(> 20%)

Decrease(10-19%)

Decrease(1-9%)

No change Increase(1-9%)

Increase(10-19%)

Increase(> 20%)

+0.01%

30% 31%

2 0 1 3

IT budgets did not change radically(2012-2013)

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

The change of IT budgets depends on the role of

corporate IT

2,263,02

3,70 3,97

(5)

(5)

(5)(5)

IT is important incompetitive

differentiation

IT is critical part ofbusiness products or

services

IT is important incompetitive

differentiation

IT is critical part ofbusiness products or

services

Decreasing IT budget Increasing IT budget

2013

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Share of IT operations increased in

IT budgets

56% 63%

37% 44%

IT operations 2012 IT operations 2013 IT Developments 2013 IT developments 2012

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Reporting lines

Partners:

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

IT is loosing its strategic importanceReporting lines of the CIO (2010-2013)

13%14%

21%

26%

56%55%

53%

40%

19%

20%

16%

23%

0%

10%

20%

30%

40%

50%

60%

2010 2011 2012 2013COO CEO CFO

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

5,3%

8,1%

2,1%

CEO COO CFO

IT budget as % of revenue

1,9%

1,5%

-3,3%

CEO COO CFO

Change of IT Budget

2,9 2,8

3,6

CEO COO CFO

IT Strategic planning (years)

IT departments under CFO supervision should suffer

strong cost control

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

CFO driven IT practice is cost controlled, and neglecting

innovation

3,96

3,633,54

3,43

3,24

2,84

3,503,60

3,46

3,15 3,15 3,19

3,60

2,93

3,95

1,95

2,31

2,81

Role of IT is toincrease business

efficiency

IT is critical fordelivering business

innovations

Role of IT is toprovide IT services in

lowest cost

IT is the main initiatorof businessinnovations

IT is important incompetitive

differentiation

Role of IT is todecrease business

costs

CEO COO CFO

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

15,38%

8%

1,96%

0%

2010 2011 2012 2013

IT cannot became a commodity for Hungarian

organizatons

Share of organizations using mainly outsourced IT services

No data

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

4,62%

2%

9,15%

14%

2010 2011 2012 2013

The popularity of corporate IT service centers

increased

Share of organizations using mainlycorporate IT service centers

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Role of IT

Partners:

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

The tight relationship between Business and IT was only

temporary?

2,6

2,8

3

3,2

3,4

3,6

3,8

4

4,2

2009 2010 2011 2012 2013

Business understands therole of IT

Efficient partnershipbetween Business and IT

Basic IT services areprovided in the requiredquality

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Business side perceives better cooperation

between Business and IT

3,31 3,2

4,08 4,08

Business understands the roleof IT

Efficient partnershipbetween Business and IT

IT Business

+23% +28%

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Pressure and opportunity

Partners:

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

There is a change in some crisis-measures

7%

18%

23%

24%

34%

44%

45%

51%

52%

0% 10% 20% 30% 40% 50% 60% 70%

Salary reduction

Non-planned layoff

Limited development contracts

Limited consulting contracts

Postpone procurements

Stop hiring new employees

Service rationalisation

Renegotiate supplier contracts

Business feasibility plan based projects

2013 2012 2011 2010 2009

20

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Planning for further measures decreased

since last year

7%

8%

9%

16%

22%

24%

25%

26%

0% 10% 20% 30% 40% 50% 60% 70%

Salary reduction

Stop hiring new employees

Non-planned layoff

Postpone procurements

Business feasibility based projects

Limited consulting contracts

Limited development contracts

Renegotiate supplier contracts

2013 2012 2011 2010 2009

21

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

There is a general decrease in further

development plans

11%

19%

23%

23%

25%

26%

27%

38%

45%

66%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Identity management*

Open source

Project management development

Cloud computing*

IT risk management

ITSM development

Change in operation models

Process development

Mobility*

Operations optimalisazion

2013 2012 2011 2010 2009 Planned projects is 2013*New since 2012

22

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Plans for cloud computing implementation dropped

drastically over a year

41%

23%

2012 2013

-44.1%

Share of companies planningcloud computing projects in 2013

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

IT infrastructure and management

Partners:

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Main applications

43%

43%

47%

53%

67%

77%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Business Intelligence

E-business

Workflow

Groupware

Document Management

ERP

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Application areas

32%

42%

43%

48%

50%

52%

53%

58%

60%

62%

63%

67%

72%

80%

85%

0% 20% 40% 60% 80% 100%

Organisational Development

Quality Management

Technology Development

Marketing

Production/Manufacturing

Controlling System

Logistics

Procurement

Sales

Inventory Management

HRM

Payroll

Executive Information Systems

Accounting

Finance

2013 2010

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

59%57%

46%

34%38%

2009 2010 2011 2012 2013

Decreasing importance of process innovation in IT(BPM, BPR, Lean IT)

Ratio of organizations initiatingprocess management projects

focusing on the IT function

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

46%49%

51%

30%

26%

2009 2010 2011 2012 2013

Decreasing popularity of ITSM projects (ITIL, MOF)

Ratio of organizations initiating IT service management projetst

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

IT strategy

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

IT Strategy Planning

76% 74%78%

82% 83%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2009 2010 2011 2012 2013

Tim

efr

am

e: 2,9

years

Tim

efr

am

e: 2

,7 y

ears

Tim

efr

am

e: 2

,9 y

ears

Tim

efr

am

e: 2,9

years

Tim

efr

am

e: 3

,1 y

ears

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Major issues in IT strategy

52%

49%

57%

50%

65%

90%

55%

53%

53%

44%

48%

68%

50%

46%

54%

42%

60%

74%

0% 20% 40% 60% 80% 100%

Compliance

Risk Management

IT Controlling

Standards

Procurement, Supplier policy

Application portfolio

2013 2012 2011

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Ideas

Relationship between corporate and IT

strategy

Business

StrategyIT Strategy

ITBusiness

Strategy

Business

StrategyIT Strategy

40%

25%

17%

Business

StrategyIT Strategy 18%

1-49 FTE: 18%

50-249 FTE: 24%

250-1499 FTE: 30%

1500+ FTE: 28%

Owners

State: 21%

Domestic: 31%

International: 48%

Respondents

Top Manager: 56%

Manager: 33%

Other: 11%

I T S MResearch

2 0 1 3

Corvinus University of Budapest

Institute of Information Technology

More Information:

http://informatika.uni-corvinus.hu

Conclusions

Still working in crisis-mode

Share of unintentional

measures decreasedover a year

Developments arestill suspended

Decreased interest for ITSM

developments

top related