Asia manufacturers to boost IT spend in 2011

Asia manufacturers to boost IT spend in 2011

Summary: Companies in region will turn to IT to better manage volatile economy and expand overseas, including investing on newer technologies such as cloud computing, predicts IDC.

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Manufacturers in the Asia-Pacific region excluding Japan are expected to spend more on technology in 2011 to support critical business applications so they can grow their businesses against a backdrop of market volatility, a new report has revealed.

In a statement released Monday, IDC Manufacturing Insights said IT expenditure among manufacturers in the region will increase from US$22.4 billion in 2010 to US$34.3 billion in 2014 at a compound annual growth rate (CAGR) of 11.3 percent.

This year alone, the region's manufacturers will devote US$24.7 billion on technology, the analyst firm told ZDNet Asia.

According to Christopher Holmes, director at IDC Manufacturing Insights International, the positive sentiment in the manufacturing industry is set to continue in 2011, following last year's "cautious optimism".

Manufacturers, he noted in the statement, will be focused on becoming more responsive to change as the volatility of the world economy continues in the year ahead. They will also work on top-line growth strategies as they seek to expand geographically and move into greater value-added activities, he added.

To better manage volatility in the marketplace, manufacturers in Asia will turn to technology, said Holmes. IT will be used, among other applications, to gain greater insight into customer behavior, improve efficiency and productivity of manufacturing operations and in the supply chain.

Holmes also said he expects manufacturers to adopt newer technologies, with "cloud-based applications, tablets and social media all starting to play a role in making the manufacturing enterprise a more efficient one".

Increased IT investment was one of the findings IDC compiled in its Asia-Pacific Manufacturing 2011 Top 10 Predictions report.

IDC also predicted that, due to the effect that rising costs and poor product quality have on manufacturing businesses' bottom line, Asian players will be motivated with a "a new zeal" to utilize new technologies to reduce waste and achieve process efficiency.

In addition, the supply chain in 2011 will witness more collaboration, with companies seeking opportunities for cross-organizational process improvements, said the analyst firm.

Topics: IT Employment, Apps, SMBs, Software, Hardware, Cloud, CXO, Browser, Banking, Social Enterprise

Jamie Yap

About Jamie Yap

Jamie writes about technology, business and the most obvious intersection of the two that is software. Other variegated topics include--in one form or other--cloud, Web 2.0, apps, data, analytics, mobile, services, and the three Es: enterprises, executives and entrepreneurs. In a previous life, she was a writer covering a different but equally serious business called show business.

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