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|A new study, produced by Booz Allen Hamilton for the UK Department of Trade and Industry (DTI), reports that Sweden, Ireland and the UK are the most sophisticated users of Information and Communication Technology (ICT), such as the Internet and wireless networking. The United States slipped to seventh place in the study, down from third place in 2003.
The DTI's International Benchmarking Study is the eighth in an annual series which reports on business use of information and communication technology. The study uses a Sophistication Index, based on a broad range of metrics, as a means of measuring businesses' ICT sophistication. The index analyzes awareness, adoption, deployment and impact of technology innovations, and also examines people, technology and processes - the key areas of commerce affected by ICT.
The study of the adoption and deployment of ICT was limited to the G7 countries, plus Australia, Ireland, South Korea and Sweden. The study was based on nearly 8,000 telephone interviews with businesses, over 2,700 of which were with UK businesses.
The rankings in this year's study were:
2. United Kingdom
5. S. Korea
7. United States
Globally, the study found that more businesses are measuring the benefits of technology, as companies place increasing emphasis on the value provided by ICT, rather than solely its costs. In addition, the focus of business has shifted from Internet access to the speed and reliability of the connection. Levels of Internet access appear to have reached a plateau while access speeds continue to rise.
In addition, businesses are becoming more selective in the type of information that they provide and the activities that they perform online. Companies are focusing more on applications that deliver measurable benefits, such as online ordering, payment and invoicing. In contrast, businesses are not as active as in previous years in providing marketing material, information about after-sales support services and enabling the tracking of order progress.
"Overall, businesses are taking a more thoughtful and selective approach to deploying technology," says Frederick Knops, Vice President of Booz Allen Hamilton. "We see a tighter focus on value-added applications, and greater emphasis on measurement to assess the benefits of new technology."
The analysis identified significant variations in the level of technology adoption and deployment across private industry sectors among the companies studied. For example, 88 percent of financial services businesses have a website, compared to 65 percent for retail and 60 percent for construction businesses. The average proportion of sales made online was highest among financial services businesses (30 percent), and lowest in the retail and services industries (17 percent each), and construction (14 percent).
In the US, businesses placing orders online and tracking order progress online are down five percent and eight percent, respectively. Use of e-marketplaces has declined from 26 percent of US businesses to 15 percent.
Despite these declines, the US ranks first in terms of technology impact, with online channels contributing significant proportions of sales and procurement activity. The average percentage of total purchases made online by US businesses increased to 28 percent, from 26 percent in 2003 and 21 percent in 2002.