Canada’s manufacturers: IT is our top operational spending priority

Although Canadian manufacturers list IT spending as a top priority, they’re actually investing less in technology upgrades than they did last year.

According to PwC’s Manufacturing Barometer Report for Q2 2012, 63 percent of companies surveyed say they need to boost investment in theiroperations, and 40 of those say IT spending is their number onepriority this year.

There’s a disconnect, however, between the need or intention ofmanufacturers to put money into IT and the actions they actually take,the survey suggests.

“Regardless of their belief that spending to improve their IToperations is good for business, in reality taking action to investremains low. Overall spending on IT is three per cent despite anindustry average of 3.6 per cent for IT spending as a percentage ofrevenue in 2011,” PwC stated in a news release.

What gives? It may be a case of manufacturers ghettoizing IT as animportant but very separate part of their operations rather thanviewing it as crucial to every component of their entire businessstrategy, said Richard Jhang, technology advisor leader at PwC.

“Organizations must view technology as an essential part of theirentire business plan and not just part of an IT department consigned tomundane functions such as keeping servers running and email flowing,”Jhang said in the release.

The tone of the Q2 survey results is decidedly downbeat with 54 percent of companies saying they’re optimistic about the Canadian economy,a 22 percent drop from Q1.

The study is a quarterly telephone survey to gauge the 12-month outlookof manufacturing executives for revenue growth, merger and acquisitionactivity, new investments, hiring plans and emerging business trends.

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Jim Love, Chief Content Officer, IT World Canada
Christine Wong
Christine Wonghttp://www.itbusiness.ca
Christine Wong has been an on-air reporter for a national daily show on Rogers TV and at High Tech TV, a weekly news magazine on CTV's Ottawa affiliate. She was also an associate producer at Report On Business Television (now called BNN) and CBC's The Hour With George Stroumboulopoulos. As an associate producer at Slice TV, she helped launch two national daily talk shows, The Mom Show and Three Takes. Recently, she was a Staff Writer at ITBusiness.ca and is now a freelance contributor.

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