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Chapter 4: Process Manufacturing
Chapter 5: Discrete Manufacturing
Chapter 6: Banking and Finance
Chapter 7: Insurance
Chapter 8: Retail
Chapter 9: Wholesale Distribution
Chapter 10: Energy and Utilities
Chapter 11: Healthcare Services
Chapter 12: Professional and Technical Services
Chapter 13: Transportation and Logistics
Chapter 14: Construction and Trade Services
Chapter 15: IT Services and Solutions
Chapter 16: Government
Chapter 17: Nonprofits and Charitable Organizations
Chapter 18: Education
Chapter 19: Commercial Real Estate
Chapter 20: High-Tech
Chapter 21: Food and Beverage
Chapter 22: Industrial and Automotive
Chapter 23: Commercial Banking
Chapter 24: Brick-and-Mortar Retail
Chpater 25: Online Retail
Chapter 26: Utilities
Chapter 27: Hospitals
Chapter 28: City and County Government
Chapter 29: Government Agencies
Chapter 30: Logistics
Chapter 31: Higher Education
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For CIOs and consulting firms, this 31-chapter study provides key metrics and unbiased data for you to benchmark an organization's total IT spending and staffing levels. This study will allow you to achieve the following outcomes:
Benchmark your IT operational spending levels by comparing them with those of organizations of similar size and industry sector. Over 20 specific IT cost management ratios and other IT support metrics are provided, such as IT budget as a percent of revenue and IT budget per employee/user, allowing IT executives to highlight opportunities to reduce IT costs, optimize IT expenses, and improve the efficiency, effectiveness, and governance of the IT organization.
Measure your IT capital budget spend levels. Nearly 20 specific IT capital budget metrics are provided to help stakeholders monitor IT investment levels relative to competitors.
Manage your IT staffing levels. Over 30 IT head count ratios are provided for benchmarking IT staff counts, measuring IT worker productivity, and achieving efficiency within the IT department.
Evaluate your IT key performance indicators. Compare your IT intensity and infrastructure metrics with your peers, using measures such as new initiative spending, custom/commercial software mix, users per network site and per printer, PCs per user, percentage of users with smartphones, data center OS mix, PC refresh rate, first-call resolution rate, and other KPIs – all important factors in budgeting for IT.
For vendors of IT products and services, this study provides valuable insights into the current IT budgeting priorities of corporate buyers and changes in levels of IT operational and capital spending. This study provides objective data based on our in-depth survey of IT decision makers. As such, it can be a valuable source of IT spending statistics to validate assumptions underlying your business strategy, competitive analysis, pricing strategies, and sales processes.
This section lists all the key metrics provided in the full report. All key metrics listed appear in Chapter 2 for the composite sample and in Chapters 3A, 3B, and 3C for small, midsize, and large organizations.
All key metrics are also provided in our industry sector and subsector chapter (chapters 4-31), except those marked with an asterisk (*).
In Section 1, we describe the key characteristics of the sample to establish a basis for comparison with other IT organizations. These key metrics are as follows:
Organization size demographics, including revenue, employees, and revenue per employee
IT spending demographics, including total IT spending, IT capital spending, and IT outsourcing budget
IT infrastructure demographics, including number of data centers, network sites, and business applications
Key metrics of IT intensity, including users as a percentage of employees, PCs per user, percentage of users with tablets, percentage of users with smartphones, users per network site, percentage of application functionality from custom systems, and first call resolution rates
In Section 2, we provide IT spending benchmarks by type of spending. These key metrics not only provide additional demographic information but also identify IT trends. They include:
Percentage of IT spending devoted to ongoing support
Spending on new initiatives as percentage of IT budget
Outsourcing as percentage of IT budget
Percentage of IT spending outside IT budget
Cloud/subscription software as a percentage of application portfolio (*)
In Section 3, we examine key budget priorities for IT organizations. These key metrics include:
Spending priorities by budget area, showing the net percentage of organizations planning to increase spending on information security/privacy, IT personnel, business applications, data center, networking, and end-user technology (*)
Plans for IT outsourcing, showing the percentage of companies planning to increase, decrease, and maintain spending at about the same level (*)
Spending priorities by IT initiative, showing the net percentage of organizations planning to increase spending on cloud applications, cloud infrastructure, data analytics/business intelligence, disaster recovery/business continuity, digital transformation, systems/data integration, legacy systems modification, and data center automation (*)
The importance of lowering costs vs. improving service levels in the coming year (*)
Section 4 presents key metrics for IT spending, which includes current-year IT operational and capital spending, but excludes depreciation. These key metrics include:
Total IT spending as a percentage of revenue
Total IT spending per user
Total IT spending per PC
Budget categories as average percentage of total IT spending, including spending on personnel, business applications, data center hardware/software, energy/utilities, IT facilities/floor space, network infrastructure, security, voice/data carrier expenses, PCs/end-user devices, printers/printing, and other expenses
Section 5 presents key metrics for IT operational spending. These key metrics are as follows:
Percentage of organizations decreasing, maintaining, or increasing IT operational spending year over year (*)
IT operational budget percentage change from previous year (*)
Adequacy of current IT operational budget to support the business (*)
IT operational spending as a percentage of revenue
IT operational spending per user
IT operational spending per PC
Percentage of IT operational budget charged back to business units
Budget categories as average percentage of IT operational spending, including spending on personnel, business applications, data center hardware/software, energy/utilities, IT facilities/floor space, network infrastructure, IT security, voice/data carrier fees, PCs/end-user devices, printers/printing, and other expenses
Personnel as a percentage of IT operational spending at the 25th percentile, median, and 75th percentile
Depreciation as a percentage of IT operational budget
Section 6 provides an analysis of IT capital budgets, including:
Percentage of organizations decreasing, maintaining, and increasing IT capital spending (*)
IT capital budget change from prior year (*)
IT capital budget as a percentage of IT budget
Budget categories as average percentage of IT capital spending, including spending on personnel, business applications, data center hardware/software, energy/utilities, IT facilities/floor space, network infrastructure, security, voice/data carrier fees, PCs/end-user devices, printers/printing, and other expenses
In Section 7, we provide key metrics and trend data on IT staffing, including:
Users per IT staff member
Percentage of organizations increasing, maintaining, and decreasing IT staff levels from previous year (*)
IT staff head count change from previous year (*)
IT staff turnover
Annual training allocation per IT employee
Contingency workers as percentage of IT staff
IT staff functions as average percentage of IT staff, including IT managers, IT finance/vendor management/procurement, project management, clerical support, application developers, application maintenance/support, data management, quality assurance/testing, database administration, server support, network support, communications support, web/e-commerce, IT security, help desk, desktop support, documentation/training/process and standards, and other functions
In Section 8, we provide key benchmarks for six job functions:
IT managers as a percentage of IT staff (*)
OS instances per server support staff member (*)
Network devices per network support staff member (*)
Applications per application developer (*)
Applications per application maintenance and support staff member (*)
PCs per desktop support staff member (*)
Users per help desk staff member (*)
Help desk first-call resolution rate (*)
Help desk tickets per end-user support staff member (*)
Section 9 shows IT spending benchmarks by service area as a percentage of total IT spending. The service areas are IT management, business applications, data center, network, and end-user computing.
Section 10 provides business application metrics, including:
Business application spending as percentage of IT spending
Business application spending per user
Section 11 covers these data center spending and infrastructure metrics:
Processing workload by operating system, including IBM mainframe, Unix, Linux, IBM i (OS/400), Windows Server, and other
Consolidated Data Center Spending per User
Consolidated Data Center Spending per Physical Server (*)
Data Center Hardware/Software as Percentage of IT Spending
Data Center Hardware/Software Spending per User
Energy/Utilities as Percentage of IT Spending (*)
Energy/Utilities Spending per User
Energy/Utilities Spending per Physcial Server (*)
IT Facilities/Floor space as Percentage of IT Spending (*)
IT Facilities/Floor space Spending per User (*)
OS Instances per Physical Server (*)
Users per Physical Server (*)
Section 12 covers the following network metrics:
Consolidated network spending per user
Network infrastructure as a percentage of IT spending
Network infrastructure spending per user
Network spending per network site
IT security as a percentage of IT spending (*)
IT security spending per user (*)
Data/voice carrier spending as a percentage of IT spending (*)
Data/voice carrier spending per user (*)
Section 13 covers the following network computing metrics:
Consolidated end-user technology spending per user
PCs/End-user devices as a percentage of IT spending
PCs/End-user device spending per user
PC refresh rate in years (*)
Printer/Printing as a percentage of IT spending (*)
Printer/Printing spending per user (*)
Users per printer (*)
As noted above, in each chapter, the section on total IT spending and the section on IT operational budgets include a detailed analysis of IT budget line items as a percentage of the total. Line items include IT personnel, business applications, data center hardware/software, energy/utilities, IT facilities/floor space, network infrastructure, IT security, voice/data carrier expenses, PCs/end-user devices, printers/printing, and “other.” An example of the presentation of this data is shown in Figure 1-14. Please note that the percentages shown here do not represent the actual data in the report, but are only provided to illustrate the format of the data presented.
As noted earlier, the staffing section of each chapter concludes with a breakdown of IT staffing ratios for 18 individual job positions, with each position provided as an average percentage of the total IT head count. IT workforce job positions include IT managers; IT finance/vendor managers; project managers; clerical/administration; application developers; application maintenance/support; business analysts; data management; quality assurance and testing; database administration; server support; network support; communications; web and e-commerce; security, help desk; desktop support; and documentation, training, and IT process/standards personnel and other.
An example of the presentation of this data is shown in Figure 1-15. Please note once again that the percentages shown here do not represent the actual data in the report, but are only provided to illustrate the format of the data presented.
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This chapter provides an overview of the key findings from the full study and describes the contents of the subsequent chapters. It also includes information on the study participants and the survey methodology.
This chapter provides composite metrics for all of the organizations surveyed, across all industry sectors and organization sizes. The key metrics provided in this chapter are listed in the Key Metrics Descriptions section below.
In these three chapters, we analyze each of our IT spending and staffing metrics by organization size. This chapter classifies organization size differently than most classification schemes. We use the size of the IT operational budget, as revenue is not always a good indicator of the size of the IT operation. This enables IT organizations to compare themselves against similar-size IT organizations. We define the size categories as follows:
IT operational budgets less than $5 million
IT operational budgets between $5 million and less than $20 million
IT operational budgets $20 million or greater
To avoid the problem of having very small organizations in our sample, we have excluded respondents with less than $50 million in annual revenue.
Chapter 4 provides benchmarks for process manufacturers. Process manufacturers are defined as those where the production process adds value by mixing, separating, forming, or chemical reaction. The sector includes manufacturers of chemicals, petrochemicals, semiconductors, pharmaceuticals, dietary supplements, food and beverage products, building materials, packaging materials, steel, glass, paper products, and other process-manufactured goods. The 47 respondents in the sample range in size from a minimum of about $50 million to a maximum $32.7 billion in annual revenue.
Chapter 5 provides benchmarks for discrete manufacturing organizations. Discrete manufacturers are defined as those where the production process adds value by fabricating or assembling individual (discrete) unit production. The category includes manufacturers of consumer products, industrial equipment, telecommunications equipment, aerospace products, furniture, auto parts, electrical parts, medical devices, and electronic devices, among other products. The 43 respondents in this sample range in size from a minimum of about $62 million to $80 billion in annual revenue.
Chapter 6 provides benchmarks for banking and financial services companies. The firms in this sector include commercial banks, investment banks, credit unions, mortgage lenders, consumer finance lenders, and other types of lenders and financial services providers. The 22 respondents in this sector range in size from a minimum of about $50 million to a maximum of $90 billion in annual sales.
Chapter 7 provides benchmarks for insurance companies. The firms in this sector include companies that sell medical and dental insurance, life insurance, property and casualty insurance, auto insurance, disability insurance, and other types of insurance. The 19 respondents in this sector range in size from a minimum of about $50 million to $35 billion in annual revenue.
Chapter 8 provides benchmarks for retailers. This sector includes retailers of clothing, jewelry, hardware, furniture, sports equipment, groceries, pharmaceuticals, and general merchandise. They include department stores, furniture stores, pharmacies, convenience stores, sporting goods stores, and specialty retailers. We also include hospitality and consumer services in this sector. The 30 respondents in the sample range in size from $80 million to $63 billion in annual revenue.
Chapter 9 provides benchmarks for wholesale distributors. The category includes wholesale distributors of building products, home furnishings, home improvement products, auto parts, industrial components, electronics, food and beverage, and other products. The 21 respondents in the sample range in size from a minimum of about $50 million to $4 billion in revenue.
Chapter 10 provides benchmarks for public utilities, oil and gas producers, service companies, and midstream distributors across all organization sizes. The 23 respondents in this sector include public utilities; water, gas, and electric utilities; integrated energy companies; upstream exploration and production companies; natural gas companies; pipeline operators; and other energy and utilities companies. The companies in our sample range in size from a minimum of about $50 million to more than $26.8 billion in annual revenue.
Chapter 11 provides benchmarks for healthcare services companies. The 42 respondents in this sector include community hospital groups, multiregional hospital systems, healthcare systems, dental service organizations, university hospitals, long-term care facilities, and other healthcare organizations. These organizations range in size from a minimum of about $50 million to $16 billion in annual revenue.
Chapter 12 provides benchmarks for professional and technical services organizations. The 40 respondents in the sample range in size from a minimum of about $50 million to about $10 billion in annual revenue. The sector includes firms that provide professional and technical services, including engineering, legal, accounting, financial advice, consulting, marketing, research, and other services.
Chapter 13 provides benchmarks for the transportation and logistics sector. The 24 respondents in this sample range in size from a minimum of $52 million to about $41 billion. The category includes organizations that operate buses, trucks, railways, airlines, barges, and ships. The sector also includes logistics companies that transport goods and transportation companies as well as regional transportation authorities that move people.
Chapter 14 provides benchmarks for construction and trade services companies. The 28 respondents in the sample range in size from about $52 million to $9.9 billion in annual revenue. The category includes engineering and construction companies; commercial, residential, and industrial construction contractors; oil field services firms; firms that provide mining services; environmental services firms; and other construction and trade services firms.
Chapter 15 provides IT spending and staffing statistics for the IT services and solutions sector. The category includes software companies, software-as-a-service providers, systems integrators, IT solution providers, business process outsourcing firms, and other providers of technology services and solutions. There are 27 organizations in the sample, ranging in size from around $50 million to $126 billion in annual revenue.
Chapter 16 provides benchmarks for government organizations. The 41 respondents in the sample range in size from $52.6 million to $68 billion in annual revenue. The category includes city and county governments, federal and state agencies, law enforcement agencies, organizations that provide IT services to government agencies, and other government organizations.
Chapter 17 provides benchmarks for nonprofits and charitable organizations. The sector includes local and national charity organizations, conservation groups, organizing bodies, and other nonprofit organizations. We do not include organizations where the nonprofit status only reflects the entity type, such as nonprofit hospitals, where for all intents and purposes they operate from an IT perspective in a way that is not significantly different from for-profit hospitals. The 19 respondents in the sample range in size from a minimum of about $50 million to $430 million in annual revenue.
Chapter 18 provides benchmarks for the education sector. The sector includes public and private colleges and universities, business and medical schools, for-profit educational institutions, and school districts. The 20 respondents in the sample have annual revenues ranging in size from a minimum of about $50 million to $1.9 billion.
Chapter 19 provides benchmarks for commercial real estate organizations. The 38 respondents in the sample range in size from $100 million to over $3.2 billion in annual revenue. The sector includes retail, office, industrial, multi-family, and other property management companies; commercial real estate developers; real estate investment firms; and real estate brokers, consultants, and advisors.
Chapter 20 provides benchmarks for high-tech companies. The category includes computer products manufacturers, telecommunications equipment manufacturers, semiconductor manufacturers, aerospace and defense manufacturers, pharmaceutical makers, biotechnology product makers, software developers, software-as-a-service providers, and other high-tech companies. The 34 respondents in this sample range in size from a minimum of about $50 million to $80 billion in revenue.
Chapter 21 provides benchmarks for food and beverage manufacturers. The 16 respondents in the sample range in size from $65 million to $2.2 billion in annual revenue. Food and beverage companies produce beverages, snack foods, meat products, seafood products, dairy products, dietary supplements, and other consumable food products. Some are suppliers to other food manufacturers or to the food service industry, while many also distribute consumer products to retailers or direct to consumers.
Chapter 22 provides benchmarks for industrial and automotive manufacturers. The 18 respondents in this subsector make auto parts, aviation products, material handling equipment, engines, machinery, and similar capital goods. The manufacturers in the sample range in size from $86 million to $7.3 billion in annual revenue.
Chapter 23 provides benchmarks for commercial banks. This subsector includes credit unions and community, regional, and national banks. The 16 respondents in this sample have annual revenue ranging from a minimum of about $50 million to $90 billion.
Chapter 24 provides benchmarks for brick-and-mortar retailers. This subsector includes department stores, clothing stores, convenience stores, pharmacies, hardware stores, nonprofit retailers, furniture retailers, agricultural retailers, and other retailers. The 18 respondents in this sample have annual revenue ranging from $80 million to $63 billion.
Chapter 25 provides benchmarks for online retailers. This subsector includes clothing retailers, home furnishing retailers, dietary supplements and health products retailers, sports equipment retailers, and other online retailers. The 15 respondents in this sample have annual revenue ranging from $80 million to $63 billion.
Chapter 26 provides benchmarks for utilities. The 15 respondents in this subsector range in size from about $87.9 million to $126 billion in annual revenue. This category includes gas and electric utilities, power transmission distributors, water and power utilities, and telecommunications service providers.
Chapter 27 provides benchmarks for hospitals. The 30 respondents in this subsector range in size from $60 million to $16 billion in annual revenue. This category includes community hospitals, university hospitals, nonprofit hospitals, health clinics, healthcare systems, and regional healthcare providers.
Chapter 28 provides benchmarks for city and county governments. This chapter is concerned with the IT workings of city or county governments and not individual agencies within larger governments (which can be found in Chapter 30). The 23 respondents in this subsector have annual operating budgets ranging from $60 million to $68 billion.
Chapter 29 provides benchmarks for federal, state, and regional government agencies. The category includes public health agencies, courts and law enforcement agencies, organizations that provide IT services to government agencies, social service agencies, state parks, lotteries, and other federal, state, and regional government units. The 18 respondents in the sample have operating budgets that range in size from $52.6 million to about $40 billion
Chapter 30 provides benchmarks for logistics providers. The 18 respondents in this sample range in size from $52 million to about $40.7 billion. The sector is comprised of logistics companies that transport goods, including refined petroleum distributors, national moving or courier companies, freight transportation companies, supply chain logistics providers, and other logistics companies.
Chapter 31 provides benchmarks for higher-education institutions. The sector includes public and private colleges and universities, business and medical schools, and for-profit institutions. The 16 respondents in the sample have annual revenues ranging in size from about $50 million to $1.6 billionn.
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