INTRODUCTION: How did it all start?

30 years ago People & Computers (http://www.pc.co.il/), the Interdisciplinary Center for Technology Forecasting (http://ictaf.tau.ac.il/) in Tel Aviv University together with IBM and Digital (I was in Digital at that time) tried to understand the Information Technology Market in Israel (with a clear focus on Hardware and Software Products).

The study highlighted the problems involved in conducting surveys in a small market with very few players. We received about 1000 interview results (by Tel Aviv University students) from vendors and users. We tried to get a result we could agree on but failed. The numbers showed that the procurement managers (although they agreed to the survey interview) distorted the truth. The vendors were sure to double or triple their sales numbers.
If we added up the “interview dollar results” the amount that industries bought with what the vendors sold, there was a one to ten correlation.

After the unsuccessful first try, some of us (vendor marketing) decided to work together and try to share data that wouldn’t be used (by the others) except for statistical results.
By 1986 we started sharing data for analysis (we all added a little to make our results better) and we started to get a picture of the market.
Each one of us used the data together with their own analysis/methodology.

We tried to correlate data with account managers (sales) but found that when sales quotas are involved we couldn’t get a straight answer. We couldn’t get them to understand the difference between total IT spent and Digital’s sales potential in a certain account.
Example: when an AS/400 or IBM Mainframe was in an account, Digital sales people didn’t count IBM sales in that account in their reports…. IT spent not relevant (they said).



STKI’s “Israeli IT Market” Definition & Model:

STKI definition of the Israeli IT market should include the following:

  • 1. Basically we want to count everything that IT departments buy and vendors sell for the IT use in Israel.
  • 2. While personnel expenditures of employees’ salaries is not counted, staff augmentation is counted.
  • 3. Hardware expenditures are counted taking out any amortization and other financial amounts.
  • 4. Software expenditures include licenses and maintenance costs.
  • 5. Value Added Services had to neutralize contractor/subcontractor relationships and give credit for the project only to the vendor doing the actual work.
  • 6. IT Market covers all “outside” expenditures of IT departments in Israel.
  • a. IT departments of multinational companies that have their headquarters in Israel are counted but not
    the expenses of subsidiaries outside of Israel that buy their products or services locally.
  • b. Only local expenditures of Israeli subsidiaries of multinationals are counted.


What do STKI analysts do during the year?

1. During the year STKI analysts meet with clients (users) and answer inquiries for them. During 2013 we had over 1000 meetings face to face with clients (CIOs and their managers) and answered over 2000 inquiries.
We also meet with groups of 15-30 users and discuss predetermined subjects (in the form of round tables).
Between 01/2013 and 10/2014 STKI hosted over 60 round tables and Vendor Discoveries. STKI runs about 30 surveys a year concerning subjects from security implementation to software development.
In our interactions with IT users (e.g. CIOs, IT managers), our objective is to understand the role of IT in the organization and the corresponding IT strategy, as well as to gain an overview of ongoing and planned projects and strategic decisions. Furthermore, there is an exchange of thoughts on the users’ experience with IT vendors and their criteria for vendor selection.

STKI analysts are involved in:

  • a. Quality assessment of products and vendors
  • b. Strategy and architectural solutions
  • c. Procurement questions
  • d. Decisions on new technologies
  • e. Understanding their budget
  • f. Help in best practices/staffing ratios for the Israeli Market
  • g. Much more

2. During the same time they meet with vendors and answer inquiries for vendors. During 2013-2014 we had over 1000 face to face meetings and answered over 2000 inquiries. We also met with over 60 vendors for vendor briefings (vendors describe their past performance and future strategies).
Through the interactions with IT vendors we gain a profound understanding of the organization, portfolio and the market positioning of the relevant vendors.
This way we can assess the revenue information by different dimensions. Moreover, we discuss the market perspectives and outline our market development scenario.

STKI analysts are involved in :

  • a. Market understanding
  • b. Industries needs and projects
  • c. New products and services
  • d. Product packaging and marketing strategies
  • e. Much more



METHODOLOGY (Equilibrium Model)

Starting after our annual STKI Summit (this year it was our 23th) we maintain our market model and update it (our segmentation is adjusted when the market changes) constantly.

STKI activity year goes from Summit to Summit, in other words from 1 of April till the end of March.
Our summit has been scheduled at a time that all budgets have been closed and we have time to meet and discuss them with clients.
At that time vendors can also discuss the past year and new strategies with us.

Which companies (IT departments) does STKI cover

STKI Analysis covers over 100 categories

STKI covers about 300 vendors that work in the IT Market of Israel

Disclaimer

This web site contains reports by STKI’s analysts whose educated opinions are based on personal experience, meetings with clients, vendor briefings, information provided by third-party research subjects, and secondary research sources.

STKI makes no warranties, express or implied, concerning the quality, fitness for a particular purpose, title or non-infringement of this report, or the results to be obtained therefrom or any system or process that may result from customer’s implementation of any recommendations STKI may provide.

STKI expressly disclaims any warranty as to the adequacy, completeness or accuracy of the information contained in this report. Customer is solely responsible for any business decisions it makes to achieve its intended results.