European IT firms ‘too costly’ to compete globally

A survey of 126 global CIOs and IT managers, conducted by KPMG and the Economist Intelligence Unit, reveals a yawning gap between the competitiveness of European IT suppliers and their counterparts to the East and West.

A survey of 126 global CIOs and IT managers, conducted by KPMG and the Economist Intelligence Unit, reveals a yawning gap between the competitiveness of European IT suppliers and their counterparts to the East and West.

While European firms are seen to excel at technological expertise, local knowledge and customer relationships, cost is hindering their success.

“Fortune 1000 companies want to be confident of enterprise-wide [global] delivery of their suppliers of traditional IT services,” says Andy Green, chief executive of BT Global Services in the survey. “But of the European players, only Capgemini – at a stretch – is seen of capable of providing that reach.”

Despite the fact that 9 out of 10 European IT buyers would like to choose regional suppliers, and are even prepared to pay more for the local touch, they still find them too expensive. They also see European firms as too inflexible on their pricing policies and say they need to introduce on-demand pricing and revenue sharing.

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