Gaining a business edge

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: A turnover of Rs 100-crore plus and yet no fixed budget for IT—that’s the tale at your average Indian medium-sized business. Now, medium-sized businesses (MB) are preparing for the next round of spending on IT in 2008-09—not only with desktops, notebooks and printers, but also connectivity and server deployments. With technology adoption greatly increasing while moving from small to medium-sized businesses, the IT spend in percentage terms of total revenue decreased in the case of the MB segment. While small businesses on an average spend one percent of their earnings on IT, medium-sized businesses are reluctant to shell out anything more than 0.55% with an average of 0.41% across verticals.

Typically, small businesses do not have a proper IT team in place nor an IT budget. In the medium businesses segment, most of them have a well-placed IT team. Let us look at the different sectors and understand how IT savvy they are.

The utilities/transportation/real estate/construction industry vertical turns out to be the least IT-savvy of all. Be it servers, security or software, this sector has been a laggard with regard to most technologies. On an average, companies in this vertical spend Rs 35.8 lakh on IT; this is 0.24% of the turnover.

Looking at server adoption in this sector, Windows servers show a 67% penetration compared to 88% in the wholesale/retail sector and 82% each in both manufacturing and IT/ITeS. The overall server deployment in this sector stood at only 88%, while all the other sectors had more than 94% server deployment.

However, with multiple offices in different locations, the need for connectivity was felt the most by companies in this sector. That’s why this vertical emerges as a leader in the adoption of ISDN, with 48% of the respondents confirming the deployment. The scenario is dominated by the use of leased lines with 61% adoption, and DSL with 41% adoption. The adoption of Wi-Fi is the least among all verticals.

TS Rajagopalan, director, Caliber Construction Co Pvt Ltd, says, “For accounting software, we use only Tally. For networking software, Windows-based software is used and as far as the hosted application is concerned, we run web-based servers.”