PricewaterhouseCoopers' Trendsetter Barometer interviewed CEOs of
312 privately-held product and service companies identified in the
media as the fastest-growing U.S. businesses over the last five years.
The surveyed companies range in size from approximately $5 million
to $150 million in revenue/sales.
NEW YORK, Oct. 10, 2006 (PRIMEZONE) -- The stakes are high as CEOs of the nation's fastest-growing private companies continue to build their rate of IT investment. They and their staffs have identified a number of hot new areas of IT development to watch over the near future -- including several they view as having an important potential impact on their business.
Fast growth CEOs report big jump in IT share of operating budget
Fast growth CEOs report that the share of their company's total operating budget devoted to IT hardware, software, and operations averaged 8.14 percent last year -- 24 percent higher than reported three years earlier, when it was 6.56 percent. Further IT budget growth is expected, going forward: 43 percent report their allocation for the next 12 months will be even larger -- including 10 percent saying "much larger" and 33 percent "somewhat larger." Only 5 percent expect a "somewhat smaller" budget.
"In recent years, the IT spending strategy for most of these companies has concentrated on aggressively tapping hot new applications with the potential to take their operation to a higher level of business performance," said Joe Rizzo, Advisory partner and U.S. Technology sector leader for PricewaterhouseCoopers. "New hot areas of IT development are closely monitored."
CEOs' view of hot new areas of IT development remains constant
As when initially surveyed three years ago, fast-growth CEOs and their staffs have again identified security applications, wireless networks, and faster data transactions (ultra wide band) as the top three areas of new IT development for the next two to three years. Close behind, Internet telephony and data convergence are seen as growing greatly in importance, as are RFID wireless technology and nanotechnology.
In contrast, speech recognition technology is seen as cooling.
3-Year Trendline
Hot Areas of IT Development 1Q03 1Q06 +/-% Diff.
--------------------------- ---- ---- ----------
Security applications 62% 65% +3 points
Wireless networks 61% 62% +1 point
Faster data transactions
(UWB/ ultra wide band) 65% 61% -4 points
Internet telephony & data
convergence 38% 57% +19 points
Web-based interconnection
standards in infrastructure
and enterprise software NA 51% NA
Wireless telephony
("Bluetooth" or 3G Wireless) 46% 47% +1 point
RFID wireless technology 29% 43% +14 points
XML/ Web services (including
SOA/ service oriented
architecture) 49% 42% -7 points
GPS (global positioning
systems) 45% 42% -3 points
On-demand IT services NA 39% NA
Nanotechnology 30% 39% +9 points
Offshoring IT support to
low-cost countries NA 33% NA
Speech recognition 30% 17% -13 points
"The hottest of the hot areas of IT development is seen to be Internet telephony and data convergence, which has generated the greatest increase in CEO recognition over the past three years," said Rizzo. "This is the big, breaking wave. More than ever, companies need to be asking themselves how convergence of the technology and telecommunications industries will be impacting their IT strategy."
CEOs name three leading areas having important potential impact on their business
"Trendsetter" CEOs expect the "big three" leading areas of new IT development -- security applications, wireless applications and faster data transactions (ultra wide band) -- to have an important potential impact on their own business, with security applications and wireless networks showing strong increases in recognition over the past three years.
Internet telephony and data convergence is close behind, and again shows the greatest jump in recognition. RFID wireless technology also showed a gain, though at a lower level.
3-Year Trendline
Impact on own Company 1Q03 1Q06 +/-% Diff.
---------------------- ---- ---- ----------
Security applications 45% 58% +13 points
Wireless networks 38% 50% +12 points
Faster data transactions
(UWB/ ultra wide band) 49% 47% -2 points
Internet telephony & data
convergence 25% 45% +20 points
Web-based interconnection
standards in infrastructure
and enterprise software NA 44% NA
XML/ Web services (including
SOA/ service oriented
architecture) 40% 33% -7 points
Wireless telephony
("Bluetooth" or 3G Wireless) 26% 32% +6 points
On-demand IT services NA 27% NA
RFID wireless technology 13% 24% +11 points
GPS (global positioning
systems) 14% 20% +6 points
Offshoring IT support to
low-cost countries NA 11% NA
Nanotechnology 9% 10% +1 points
Speech recognition 11% 8% -3 points
"Fast-growth companies will be focusing their attention on what they perceive to be the hottest applicable new technologies," said Rizzo. "Whether a company is looking to succeed in a market, or to dominate one, technology can change that market overnight. IT platforms need to be ready to both seize opportunities and counter new threats."
PricewaterhouseCoopers' Trendsetter Barometer is developed and compiled with assistance from the opinion and economic research firm of BSI Global Research, Inc.
PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 130,000 people in 148 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.
"PricewaterhouseCoopers" refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.
If you have a question about this Trendsetter Barometer survey, please contact Pete Collins, survey director and publisher, at 646-471-4496 or e-mail to: pete.collins@us.pwc.com
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