Productivity push to drive growth in 2005: IDC

A push for greater productivity among executives will drive growth in 2005 IDC Canada predicts.

Hundred executives interviewed by the analyst firm last November and December placed productivity at the top of their corporate strategic agendas for 2005, making it more prominent than its ever been before in corporate IT decision making.

“This is not new,” said Denis Vance IDC Canada’s chief research officer. “It has been a hot issue with the group for the past three years. What we believe is new is that productivity is a much more dominate theme.” Vance presented the highlights of IDC’s findings during a conference call addressed from IDC’s Toronto offices.

This shift in executive priorities, he said, is accompanied by a greater emphasis placed change and adaptability of IT technologies and infrastructures than reliability and uptime. As well, executives will focus greater energy on getting technology vendors to enhance the overall value of IT investments. One way of accomplishing this, he said, is by getting vendors to help out in employee training.

“(A total) of 67 per cent of our respondents either said IT was a significant source of competitive advantage or a steady contributor to ongoing operational capabilities,” Vance added. “Put this (all) together and we believe this represents a strong case for productivity, and consequently IDC expects this will drive investments in IT infrastructure.”

IDC Canada expects the IT sector will grow by 4.3 per cent in 2005, driven by increased hardware purchases, as companies start to replace older systems and desktops.

“Much of the stuff installed in preparation for Y2K is being replaced,” Vance said. “Additionally, the move to replace desktops with notebooks continues and there is no letup in the demand for servers and storage.”

What could derail all this, he said, are changes to the Canadian economy such as high oil prices or the Canadian dollar going and then staying above the 0.85 cents range in comparison to the U.S. dollar.

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