aasa technology council it spend and trends survey results 2013 this presentation is the property of...

AASA Technology Council IT Spend and Trends

Survey Results

2013

This presentation is the property of the Automotive Aftermarket Suppliers Association (AASA) and subject to the protection of copyright, trademark and other intellectual property laws. No portion of this presentation may be reproduced or

distributed (including by email) without the prior written consent of AASA.

2013 ATC IT Spend & Trends

2

Contents

Executive Summary 3

Benchmarking: Spend and Priorities 7

IT Role and Relationships 25

Aftermarket-Specific Technologies/Standards

36

Cataloging 43

Emerging Technologies 49

Appendix• Answers to selected questions• Demographics• Methodology and Contact Information

525459


3

Executive Summary

Key Findings


4

Category Key Findings Page

IT Spend and

Forecast

IT budgets increased in 2013 at a slightly faster rate than in 2012

9

An overwhelming majority (97%) indicated that demand for IT at their companies was rising

11

IT HiringMajority of respondents (77%) indicated that their companies are hiring for openings or creating jobs

14

Most Common Projects

Most common 2013 projects were network infrastructure, ERP, and tablets & mobile devices

17

Most Important Projects

The most important project – by far – is “Deploy or upgrade ERP or CRM”. 42% of respondents indicated this was their number one priority for 2013.

21


5


Future Looking

Respondents indicated that IT budgets would continue to increase in 2014, but growth would slow.

24

Top priorities for 2014 spending increases will be ERP and use of tablets and mobile devices.

25

Role of IT in Company

Other industries’ IT departments are more likely to be playing a “leading” or “strategic” role than aftermarket IT

29

Aftermarket-Specific

Technologies/Standards

Average percentage of sales handled by EDI and IPO expected to increase 30% and 150%, respectively, by 2016.

38-39

Average percent of data delivered in ACES will be flat at 41% by 2016, though the amount of data delivered in PIES will double to 50%

41-42


6


Cataloging

The biggest issue the industry faces in supporting e-tailing is providing accurate catalog data.

45

Majority (65%) expect an increase in catalog data management budget in the next 12 months.

47

“Bottlenecks by third part data or cataloging services” and “Loss of control of data IP” are the most pressing issues in regards to communicating with channel partners.

49

Emerging technologies

“Big data” and “e-commerce” are expected to have a slight positive impact on the aftermarket in the next ten years.

51


7

Benchmarking:Spend and Priorities

IT Spend and Forecast

IT Hiring



Future Looking


8

IT budgets increased in 2013 at a slightly faster rate than 2012

Majority (55%) indicated an increase in budget for 2013, while the average increase for aftermarket IT was 3.8%, 0.2 percentage points greater than in 2012

Year Average

2012 +3.6%

2013 +3.8%


9

IT budget as percent of revenue was below 2% for majority of respondents

However, the average IT budget as a percent of revenue remained steady year-over-year

Year Average

2012 1.6%

2013 1.5%


10

In alignment with IT budget growth, an overwhelming majority (97%) indicated that demand for IT at their

companies was rising

No one indicated a decline in

demand for IT


11

Demand for IT is “rising” 37% more for aftermarket companies than in other industries


12



IT Hiring



Future Looking


13

Hiring: majority of respondents (77%) indicated that their companies are hiring for openings or creating jobs


14

Aftermarket is “expanding” and “filling openings” in IT 14 percentage points more than other industries

Expanding & Filling

Openings

Frozen & Cutting

Aftermarket 77% 24%

All Industries

63% 37%

Aftermarket vs. All

Industries

14 percentage

points (+22%)

Other industries are expanding by 10

percentage points more than aftermarket

companies


15



IT Hiring



Future Looking


16

Most common 2013 projects were network infrastructure, ERP, and tablets & mobile devices

Increasing server virtualization and “big data” are also high priority

Note: Should not sum to 100 due to allowing respondents to select multiple categoriesERP: Enterprise Resource Planning; CRM: Customer Relationship Management; Big Data: a collection of data sets so large and complex that it becomes difficult to process using traditional data processing applications.


17

“Deploy or upgrade ERP or CRM” continues to remain a top project for aftermarket IT

Upgrade network infrastructure jumped from fifth to number one; big data dropped out of the top three most common projects

Note: Options were changed slightly from 2012 to 2013

Top Three Projects for 2012

1. Deploy or upgrade ERP system

2. Enhance “big data”/BI/decision-support system

3. Upgrade storage infrastructure

Top Three Projects for 2013

1. Upgrade our network infrastructure

2. Deploy or upgrade ERP or CRM

3. Increase use of tablets, mobile devices, etc.


18

“Upgrade our network infrastructure” was the most common initiative for both aftermarket IT and IT in other industriesInformation security and storage infrastructure were more often pursued in other

industries than they were in aftermarket IT departments

Source: Information Week Outlook 2013

Top Three Projects for 2013 for Aftermarket IT

1. Upgrade our storage infrastructure


3. Increase use of tablets, mobile devices, etc.

Top Three Projects for 2013 for Other Industries


2. Improve information security

3. Upgrade our storage infrastructure


19



IT Hiring



Future Looking


20

However, the most important project – by far – is “Deploy or upgrade ERP or CRM”

For 42% of respondents ERP is the top initiative for their company


21

Top initiative for aftermarket IT remained the same from 2012“Big data” also remained a top issue as well (though top priority for only 19% in 2013

versus 25% in 2012)

Note: Options were changed slightly from 2012 to 2013

2012: Most Important Projects

1. Deploy or upgrade ERP system

2. Build/enhance big data/BI decision-support system

3. Upgrade storage infrastructure

2013: Most Important Projects


2. Build or enhance a big data system / improve our data



22



IT Hiring



Future Looking


23

Respondents indicated that IT budgets would continue to increase in 2014, but slow

Majority (64%) indicated an expected increase in IT budget for 2014, while the average increase for aftermarket IT is expected to be 2.8%

Although the average increase

is positive, it is slightly lower

than the growth that was

indicated for 2013 (+3.8%). Is investment in IT growth slowing?


24

Top priorities for 2014 spending increases: ERP and use of tablets and mobile devices

More than two thirds of respondents indicated that spending would increase for these initiatives in the coming year

Note: Should not sum to 100 due to each category asked a separate question


25

IT Role and Relationships


Relationships with Other Parts of Company

What IT Spends Its Time On


26

Aftermarket IT split on company approach to IT43% of respondents indicated that their company’s approach was tactical (looped in to

implement plans) where as 40% indicated that their approach was strategic (considered overall strategy for growth)

Divide between whether IT is there for execution or to provide

insight for growth of the company


27

Other industries’ IT departments are likely to be “leading” or “strategic” more than aftermarket IT

Majority of aftermarket IT (56%) is defined as “Tactical” or “Minimalist”

Leading & Strategic

Tactical & Minimalist

Constrictive & Nonexistent

Aftermarket 43% 56% 0%

All Industries 60% 37% 3%

Aftermarket vs. All Industries

-17 per. pts.

+19 per. pts. -3 per. pts.


28






29

Aftermarket IT has the best relationship with “Customer Service” and “Finance” among other company functions

Relationship with “Marketing” was fairly low at 3.6


30

On average, aftermarket IT interacts with customers on occasion, but amount of interaction varies widely

One fifth of respondents indicated they interact with customers on a daily basis


31






32

Respondents indicated that most of their time (44%) is spent on “Internal centric projects”

External projects: IT projects that

are directed toward the end

consumer

IT centric projects: IT projects that

are directed toward bettering

internal IT

Internal centric projects: IT

projects that are directed at

bettering internal functions


33

For other industries, IT spends the majority of its time (66%) on IT centric projects, whereas aftermarket IT only spends

one-third of its time

Aftermarket IT spends 27% more time on

“External projects” than Other industries


34

On average, respondents spend 30% of their time on ERP software

This is three times as much time as spent on any other business application


35

Aftermarket-Specific Technologies/Standards


36

Average percentage of sales handled by EDI projected to increase 30% by 2016

Average percentage of sales handled by EDI increased 13% from 2012 as EDI continues to remain an integral part of aftermarket IT

+13%

+30%(+9.1% per year)


37

Average percentage of sales handled by IPO to increase 150% by 2016

IPO expected to account for one-fifth of sales transactions


38

Percentage of customers utilizing virtual inventory expected to increase by 130% by 2016

However, the percent of customers utilizing it was flat year-over-year

+130%(+36.2% per year)


39

Average percent of data delivered to customers in ACES format expected to remain steady through 2016

Respondents indicated only a 1 percentage point increase from now until 2016


40

Average percent of data delivered to customers in PIES format to nearly double by 2016

Respondents indicated that in 2015 half of all data delivered to customers will be in PIES


41

For 32% of respondents, mapping North American vehicle data to a global table is a critical issue

However, for the majority of respondents (68%) this is not a burning issue

32%

Note: Rated on a scale of 1 to 7 where 1 is "Not critical" and 7 is "Very critical"


42

Cataloging


43

The biggest issue the industry faces in supporting e-tailing

is providing accurate catalog dataIf successful, accurate data throughout multiple channels could lead to increased

revenue and profit

“Biggest challenge is consolidation and cleaning

of data from multiple systems.”

“From an industry viewpoint, manufacturers/suppliers need to understand the importance of

providing accurate data and how that translates into increased revenue and

profits.”

What issues does your company face in providing accurate catalog and application data to e-tailing sites? What does the industry need to do to address the issues?

“Harmonize data across various applications.”

For full results, see Appendix


44

72% have 3 or more FTEs working in product & catalog data management

Note: 70% had 3 or greater FTE in product and catalog data management in 2012


45

Majority (65%) expect an increase in catalog data management budget in the next 12 months

Budget expectations increased 1.2 percentage points from last year, proving catalog data management is increasingly integral to aftermarket success

Note: None cited a decrease in catalog budget

Year Average

2012 +4.4%

2013 +5.6%


46

Majority (65%) of respondents indicated that catalog and data management function resided with the marketing department

Only 4% of respondents indicated that cataloging had its own department

Note: Respondents were not given choices; they were able to write in their own responses


47

“Bottlenecks by third party data or cataloging services” and “Loss of control of data IP” are most pressing issues in

regards to communicating with channel partners


48

Emerging Technologies


49

“Big data” and “e-commerce” are expected to have a slight positive impact on the aftermarket in the next ten years

Most emerging technologies were rated as having no impact


50

Respondents indicated that in their company “IT” and “Marketing” are focused on these emerging technologies

One-fifth of respondents indicated that “No one” is addressing these emerging technologies

Note: Respondents were able to write in answers and allowed multiple responses and therefore does not sum to 100


51

Appendix I

Full responses to selected questions


52

What issues does your company face in providing accurate

catalog and application data to e-tailing sites? What does the industry need to do to address the issues?

“A data assessment standard would be helpful.”“Biggest challenge is consolidation and cleaning of data from multiple systems.”“Continue to build strong cross reference information.”“Data spread across multiple systems.”“[Our company] supplies to data to the customer buying the products. It is cumbersome to get updated information past the "middle-man" to the e-tailers.”“Direct interaction with e-tailers. They buy through WD's.”“From a Company viewpoint, no real issues- accurate data is our standard. From an Industry viewpoint, manufactures/supplier need to understand the importance of providing accurate data and how that translates into increased revenue and profits. How to do that, is the responsibility of all Industry participants, but must be driven from the top down- Executive Level support of manager level processes and budgets.”“Harmonize data across various applications.”“Keeping up with enhanced data.”“Lack of resource.”“Not enough data to make a statement at this time.”“Pricing controls”“Proprietary formats.”

“Staffing, overcoming our bid data issues like hosting and BI”“Users actually doing correct data entry. There's not much the industry can do to fix this.”


53

Appendix II

Demographics


54

Job Title


55

Company Size


56

Product Categories / Business Segments


57

Customer Base Composition


58

Appendix III

Methodology


59

AASA Technology Council IT Spend and Trends methodology notes

• The AASA Technology Council IT Spend and Trends survey presents the latest information on aftermarket supplier sentiments and market trends.

• The purpose of the survey is to provide participants with information regarding spending benchmarks and IT trends in the aftermarket.

• Participation is only available to AASA supplier members. There were 31 survey responses.

• Comments are edited only for spelling and diction and may contain grammatical errors due to their verbatim nature.

• All 2012 numbers were obtained through the 2012 ATC IT Spend & Trends Survey

• Responses to this survey are confidential. Therefore, only aggregated results will be reported. Individual responses will not be released and will be destroyed after results are compiled.


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AASA Technology Council

Chris Gardner

Vice President, Programs and Member Services

Office: +1 919.406.8830 | Mobile: +1 919.523.0013

Email: [email protected]

AASA Industry Analysis

AASA | Automotive Aftermarket Suppliers Association

10 Laboratory Drive | Research Triangle Park | NC | 27709 | USA

www.aftermarketsuppliers.org

Contact Information

Paul McCarthyVice President

Industry Analysis, Planning and Member ServicesOffice: +1 919.406.8812 | Mobile: +1 248.914.2567


Bailey OvermanAnalyst/Coordinator, Programs, Industry

Analysis, and Member ServicesOffice: +1 919.406.8823


aasa technology council it spend and trends survey results 2013 this presentation is the property of...

Documents

average percent of data

data ip

average increase

catalog data management

accurate catalog data

emerging technologiesbig

percent of revenue

forecastit budgets