Typography

IDC is tipping IT spending in the manufacturing sector in the Asia/Pacific excluding Japan (APeJ) region to exceed $US36 billion by 2020, representing a compounded annual growth rate (CAGR) of 5.34 percent from 2016 to 2020. IDC says manufacturing related initiatives in China, India and the ASEAN countries will account for nearly 80 percent of this figure.

The Research Manager of IDC Manufacturing Insights, Sampath Kumar Venkataswamy, says high levels of industrial automation and the push for increased operational efficiencies are driving technology investments to overcome productivity-related challenges.

""Systems integration and consolidation remains one of the top investment areas for most manufacturing organizations that are on the path of implementing smart manufacturing platforms,' Venkataswamy says.

'The push to increase visibility on the shop floor and across the value chain will continue to drive the corresponding technology investment efforts in applications such as CRM, SCM and predictive analytics.'

IDC says APeJ IT spending in manufacturing is dominated by the high tech equipment sector, followed by the chemical and automotive industries. Spending on IT services is expected to reach $US14 billion by 2020 while software related spending is expected to grow 6.91 percent CAGR for the same period and exceed $US12 billion. Software spending includes engineering applications, operations management and supply chain management software. IDC expects lower growth for hardware related spending, to $US9.4 billion by 2020.

IDC's figures come from its Asia/Pacific (Excluding Japan) IT Spending Guide 2016-2020, which measures investments on systems integration, IT outsourcing, application development/deployment, ERM, networking equipment and security at Asia Pacific level across fourteen countries and thirteen key industries.