Business performance, productivity and profitability improvements can be achieved by refocusing IT budgets towards IT innovation, according to SAP AG.

A study across the EMEA region shows that a key issue is the division of IT spend across operations, maintenance and innovation.

A third of companies believe their current IT strategy is too focused on ‘simply keeping the lights on’ in the day-to-day running of existing IT systems. A worrying 60 per cent of companies said this strategy has held them back from investing in innovation.

The most common reason for non-investment in IT is uncertainty about the economy (48 per cent), and 39 per cent said too much money is spent on operations at the moment. A further 38 per cent said the current spend priorities are harming their competitive position.

Productivity has suffered, according to 44 per cent of respondents, thanks to a lack of spend on IT innovation, and 43 per cent claim to have lost potential cost savings because of the spend deficit.

Chris McClain, senior vice president of EMEA and India, SAP Premier Customer Network, said: “Our research has confirmed that companies continue to spend more of their IT budgets on operations than on IT innovation. SAP is working with many customers around the world to help them lower their TCO to apply resources toward the innovation that will give them the advantages to grow their businesses and achieve their strategic goals.”

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