To keep up with innovation and stay ahead of their competitors, TMT companies must continuously invest in capital in various areas of their business. While the precise focus of this investment varies between the different industry subsectors, an efficient and predictable capital life cycle is critical to the profitable growth of every TMT business.
What EY can do for you
Companies often struggle to connect and align the teams, processes and tools to manage their entire capital life cycle in the most effective and agile way and capture the full value of their strategy. In a recent EY survey, 83% of business executives agree that companies need a much more agile way of managing capital. Still, several pain points prevent companies from achieving an optimal capital life cycle.
For example, a lack of connectivity and visibility between finance and operations can mean investment allocation decisions become disconnected from their related deployment, limiting efficiency and predictability in the capital life cycle while also reducing agility and responsiveness of capital investment. In the same EY survey, 82% of all companies said that they believe that there is a lack of accountability and interconnectivity across the capital life cycle that needs to be solved.
Also, it’s often difficult to track spend granularly against the original business case and KPIs, meaning deviations and value leakage cannot be quickly identified and corrected. Our research found that leading TMT companies are more than twice as likely to deploy and utilize advanced analytics based on a trusted data foundation (77% vs. 33%) to manage their capital life cycle.
Only a minority of TMT companies have a robust approach across capital spending and deployment, leading to a significant opportunity to improve efficiency and predictability to overtake the competition.