Over half of UK companies have abandoned the ‘rip and replace’ approach to software buying, according to research from Software AG, Europe’s largest business infrastructure software company.
150 IT directors were asked to compare spending habits with their future plans. 52 per cent will focus on modernising existing systems and business processes in the coming three years. This is a leap on the previous three-year period, when just 18 per cent focused on modernisation.
Meanwhile, the number of companies buying packaged applications is dropping. 39 per cent of respondents invested ‘most of their software budget’ in packaged applications, such as SAP, but only 22 per cent plan to do the same over the next three years.
43 per cent of budgets was spent on in-house applications previously, but this number will fall to 26 per cent in the next three years.
Jim Close, Country Manager at Software AG UK said: “Most UK organisations already have much of the technology needed to drive business performance.”
However, he believes that years of buying packaged systems, or in-house development, have led to a disparate IT landscape, which is slowing businesses down.
When asked about immediate spending plans for modernisation, one in five companies will invest in business process management technology (BPM) over the next six months. One in four will invest in SOA, while one in ten say they will be investing in BAM (business activity monitoring).
“Too many UK companies are sitting on an IT jigsaw. Business infrastructure technology, such as BPM and SOA, helps companies to put the pieces of the puzzle together for effective performance.”
Previous research from Software AG shows that one in two UK companies has problems with the majority of its critical business processes due to disjointed systems.
“As industries face more challenges in a slowing economy, the most successful companies won’t just compete on the products or the ideas they have, but on how effectively they can run key operations. It has never been more critical to get the technology underlying the business processes right.”
