Mid sized companies lack IT ambition

Will outsource to save money and rely on vendor advice

Mid sized companies with between 500 and 1,000 staff spend more on consultancy, outsource to save money and are less ambitious in their IT use than larger competitors.

An IT spending survey by IDC found that security tops the investment plans for all companies followed by infrastructure and application modernisation.

Two-thirds of medium-sized organisations already use outsourcing to some extent, and one third are ready to invest in more, or invest for the first time. But cost reduction is a more important driver of outsourcing spend for these organisations than it is for larger enterprises – the latter see outsourcing as a tool for business innovation leading to better alignment of IT with business. Medium-sized enterprises generally have not considered outsourcing as a driver of innovation, and vendors should help them by explaining its potential better.

"It is interesting to note that medium-sized enterprises are investing strongly, following similar strategies to those of the largest enterprises," said Consulting Director Mette Ahorlu, of IDC's European Software and Services group. "However, their thinking around IT is closer to that of a few years ago in large enterprises. Their lower level of internal technical knowledge and experience leads them to rely more strongly on advice from vendors."

The survey questioned 196 enterprises with 500 to 1,000 employees in Western Europe.