C-suite executives in mid-market firms are increasingly involving themselves in technology decision-making, and they are focusing on cloud and analytics, according to a new report by Deloitte Growth Enterprise Services.
"In the middle market, technology really has become a C-suite issue," says Stephen Keathley, national technology leader of Deloitte Growth Enterprise Services and principal of Deloitte Consulting. "The numbers are way up for executives that are actively involved in their company's technology decisions."
Between May 29 and June 15 of this year, market research firm OnResearch polled 500 executives at mid-market companies on Deloitte's behalf. The poll focused on the role and value that technology plays and how it influences business decisions in the middle market. The respondents were from mid-market companies with annual revenues ranging from $100 million to more than $1 billion.
The research found that 48 percent of mid-market executives say their company's leadership views technology as a critical differentiator and key to growth, up from 41 percent last year. Additionally, 62 percent say their company's C-suite leaders have some level of involvement in the adoption of next-generation technologies, while 46 percent say the C-suite is actively engaged. Moreover, Keathley notes that a growing percentage — 33 percent, compared with 20 percent in 2014 — say leadership is "leading the charge" when it comes to the adoption of next-generation technologies.
The C-suite's growing involvement has been accompanied by a surge in technology spend — 67 percent of respondents say their company is spending more on technology in 2015. Thirty percent (up from 19 percent in 2014) say that spend is more than five percent of revenue.
Analytics and cloud spending on the rise
"We're seeing a continuing increase in the strategic importance of technology for middle-market companies," Keathley says. "A lot of companies are starting to realize that technology is a fundamental way to reach out to their customers."
As a result, Keathley says, it should perhaps come as no surprise that cloud and analytics are the two primary areas of focus of technology investment. Forty-seven percent of respondents say analytics has the highest potential to produce the greatest productivity gains, while 43 percent feel that way about cloud applications.
Respondents who say they're in the midst of deploying of cloud-based technologies have increased from 34 percent in 2014 to 42 percent in 2015. And respondents who say they use business analytics have increased from 65 percent in 2014 to 80 percent in 2015.
"These technologies give smaller companies the ability to look and act more globally without having to make the big capital expenditures they would have had to make in the past," Keathley says.
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