U.S. High Technology Manufacturing Sector IT Software & Services Market: 1997-2002

144 Pages·1997·9.2 MB·English

United States
High Technology
Sector
l\/lanufacturing
&
Software Services
IT
1997-2002
Market:
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U.S. HIGH TECHNOLOGY MANUFACTURING SECTOR ITS/W & SERVICES MARKET: 1997 - 2002 INPUT
Abstract
The High Technology Manufacturing industry has a strong need to use IT
products and services effectively in order to be able to move into new
markets with the 'right' products at the 'right' time.
Successful High-Tec Manufacturing sector firms achieve this by
prioritizing excellence in execution over innovation. It is less important to
be first into the market than to have the most appropriate products when
entry is made.
Successful High Technology Manufacturing firms mirror this approach in
implementing IT based solutions. They emphasize optimum execution
over speed ofexecution.
Successful High Technology Manufacturing firms tend to spend
proportionally less on IT than less successful firms. They achieve this by
rigorous simplification ofall internal and external processes. They also
invest in partnership arrangements with IT product and services vendors
in order to maintain state-of-the-art capability in key areas like supply
chain management.
This report assesses the use ofIT within the U.S. High Technology
&
Manufacturing sector, particularly for IT Software Services.
The report provides an analysis oftotal IT budgets for the U.S. High
Technology Manufacturing sector. It provides forecasts for IT Software &
Services expenditure through to the year 2002 and provides comparisons
with other industry sectors.
©1998byINPUT. ReproductionProhibited.
Published by
INPUT
1881 Landings Drive
Mountain View, CA 94043-0848
United States of America
Market Forecast Program
United States High Techinology
Manufacturing Sector IT Software &
Services Martlet: 1997- 2002
©
Copyright 1998 by INPUT. All rights reserved.
Printed in the United States of America. No part of the
publication may be reproduced or distributed in any
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of the publisher.
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only by the employees of and within the current
corporate structure of INPUT'S clients, and will not be
disclosed to any other organisation or person
including parent, subsidiary, or affiliated organisation
without priorwritten consent of INPUT.
INPUT exercises its best efforts in preparation of the
information provided in this report and believes the
information contained herein to be accurate. However,
INPUT shall have no liability for any loss or expense
that may result from incompleteness or inaccuracy of
the information provided.
IM17U-519 '1998
U.S. HIGH TECHNOLOGY MANUFACTURING SECTOR ITS/W & SERVICES MARKET: 1997- 2002 INPUT
Table of Contents
I Introduction 1
A. Purpose ofthe Report 1
B. Scope ofthe Report 2
C. Methodology 5
D. Report Structure 5
E. Related INPUT Research Programs and Reports 7
Summary
II Executive 11
A. High Technology Manufacturers Emphasize Execution over
Innovation 11
B. Technology Adoption Slowed 14
C. Process Simplification 20
D. Collaboration with IT Services Firms 24
III High Technology Manufacturing Sector IT
Environment 29
A. High Technology Manufacturing Sector Overview 29
Macroeconomic Context 29
1.
2. Key Challenges for the High Technology Manufacturing Sector 32
B. Background Trends and Economic Assumptions 36
1. High Technology Manufacturing Sector Trends 36
2. Overall Economic Assumptions 38
C. Information Systems Environment 41
1. Enterprise Applications Solutions 41
2. Buyer Awareness ofEAS Vendors in the Manufacturing
Industry 44
D. Internet Commerce in the Manufacturing Sector 46
IV High Technology Manufacturing Sector IT Markets1
A. Total IT Budget for the High Technology Manufacturing Sector 51
IM17U ©1998byINPUT.ReproductionProhibited. ' I
U.S. HIGH TECHNOLOGY MANUFACTURING SECTOR ITSAW & SERVICES MARKET: 1997 - 2002 INPUT
B. IT Software & Services Market 59
1. Total IT Software & Services Expenditure 59
&
2. Industry Specific IT Software Services Expenditure 72
C. Comparison to Other Sectors 90
Electronic Business Directions 97
A. Electronic Business Futures 97
B. Electronic Business and Electronic Commerce 99
,
1. Electronic Commerce Definition 99
2. Electronic Busines Definition 100
C. Impact ofthe Internet 103
D. Issues for Corporate Computing 104
©1998byINPUT. ReproductionProhibited. IM17U
U.S. HIGHTECHNOLOGY MANUFACTURING SECTOR IT S/W & SERVICES MARKET: 1997 - 2002 INPUT
Appendices
A. High Technology Manufacturing Sector Database, 1997-2002,
U.S.
AA. Total IT Software & Services
&
AB. Industry Specific IT Software Services
B. Market Forecast Reconciliation
C. Terms and Definitions
CA. IT Market Structure
CB. Industry Sectors
IM17U ©1998byINPUT.ReproductionProhibited. iii
U.S. HIGH TECHNOLOGY MANUFACTURING SECTOR ITS/W& SERVICES MARKET: 1997 - 2002 INPUT
List of Exhibits
II
-1-1 rlign 1ecnnology iVlanuiactunng 11 Market 11
-2 High Technology Manuiacturing Industry Best Practice 13
-3 High Technology Manufacturing Sector Output 15
-4 High Technology Manufacturing Industry IT Expenditure 16
-5 High Technology Manufacturing Industry IT Expenditure Ratio 17
-6 High Technology Manufacturing Industry IT Software &
Services Growth 18
-7 High Technology Manufacturing Industry - IT Services Sector
Growth 19
-8 The Three Key Industry Processes 20
-9 High Technology Manufacturing Automation 22
-10 High Technology Manufacturing Industry Collaboration 24
-11 Internet Commerce Benefits 26
-12 IC and the Production Function 27
III
-1 The High Technology Manufacturing Sector and Total U.S.
Output - 1997 29
-2 Total Estimated Output by Industry Sector - U.S., 1997 30
-3 GDP and Total High Technology Manufacturing Sector Output
-U.S., 1997 31
-4 Vendors Considered as Alternatives to SAP 45
-5 Prospective SAP Users' Awareness ofERP Vendors 46
-6 Importance ofInternet Commerce to Manufacturing
related Activies 48
-7 Objectives / Benefits Expected with Integration 49
-8 Internet Commerce Concerns 50
-1 High Technology Manufacturing Sector IT Related
Expenditure - U.S. 51
-2 Industry Sector Comparison - U.S. 52
-3 High Technology Manufacturing Sector IT Expenditure
Comparison 53
-4 Industry Sector Comparison - IT Expenditure U.S., 1997 54
-5 High Technology Manufacturing Sector - IT Budget
Analysis - 1997 56
-6 U.S. - IT Budget Analysis - 1997 56
iv ©1998byINPUT.ReproductionProhibited. IM17U