Investment by Italian companies in digital technologies is growing further: in 2020, the ICT budget will show an overall growth of +2.8%, in particular for Big Data Analytics, Cybersecurity and ERP systems. Large companies are driving the sector, while SMEs are lagging behind, with only 23% of IT budgets expected to increase.
The data of the Digital Transformation Academy and Startup Intelligence of the School of Management of the Politecnico di Milano draw a scenario of opening up to innovation processes, including Open Innovation, and to organizational models in collaboration with start-ups, universities and research centers as well as non-competitors.
“For the fourth consecutive year – comments Alessandra Luksch, Director of the Digital Transformation Academy and Startup Intelligence Observatories of the Politecnico di Milano – we expect a positive trend in the ICT budgets of Italian companies with percentages well above the average recorded by our economy. All sectors contribute positively to this trend, but it is mainly the large companies which support this growth, therefore investments in Business Intelligence, Big Data and Analytics systems are in first place, confirming the centrality of the use, analysis and enhancement of data in innovation trends. In second place we find the need to invest in Information Security, Compliance and Risk Management Systems, a rise of several positions compared with previous years. The number of cyber-attacks is growing exponentially with ever-increasing new threats and Italian companies are increasing their investment in risk prevention. For SMEs, on the other hand, priorities fall on ERP and CRM systems, a sign that this sector is suffering from a delay in investment in technologies”.
What are the challenges for innovation?
According to the Observatory, the challenges that companies must overcome in order to manage digital innovation are research, testing and development of digital skills, together with the introduction of new working methods. Challenges which are met through change management by managers (43%), training (40%), learning paths to stimulate innovation in employees (30%), internal contests and hackathons (26%) as well as with activities to be organized in collaboration with start-ups (10%).
Another effective response is openness towards collaboration, including through the use of Open Innovation, which has become a reality for 73% of large companies and 28% of SMEs. Large companies adopt Open Innovation initiatives, incorporating external innovation stimuli into their business processes (Inbound Open Innovation), in particular through collaboration with universities and research centers (64%), start-up intelligence (49%) and the search for collaboration with established companies (39%).
Other useful initiatives to approach digital innovation identified by the Observatory are Call4Ideas, Call4Startup and contest (32%), hackathon, datathon, appathon (27%), mergers and acquisitions (25%). Much less widespread are corporate incubators and accelerators (18%), corporate venture capital (11%) and crowdsourcing (9%).
More than 6 large companies out of 10 view start-ups favorably: 35% of companies, in fact, already works with new innovative companies, 27% intends to do so in the future, while 34% does not show interest in the topic. The situation is different for SMEs, much less ready to collaborate with innovative companies: 85% is not interested, 11% is planning a future collaboration and only 4% has already started any type of collaboration.
How much and where will companies invest?
The Observatories’ estimates for next year show a 45% increase in digital investments by large companies, divided between Big Data Analytics (indicated by 42% of respondents), Cybersecurity (36%), ERP systems (29%) and CRM (29%). Data centers, mobile business, Cloud, eCommerce, Industry 4.0, Artificial Intelligence and Machine Learning follow. The percentage of investments in Blockchain is very small, stable at 3%. Obviously, the investment priorities differ for SMEs, oriented towards introducing ERP (37%), CRM (28%) and Mobile Business (24%) systems, while Artificial Intelligence and Machine Learning are at the bottom of their spending priorities.
“We note the trend – concludes Alessandra Luksch – to allocate budgets for digital innovation, in addition to the ICT Directorates, also to others such as Marketing, Business and Digital Development Directorates or to the Technical Directorates and R&D and Innovation. In general, it is clear to everyone that no business can now exclude digital technologies, which become a lever of innovation at every level: products, processes and organization. In this scenario, the ICT Directorate acts as an orchestrator and each function plans its future based on digital innovation”.