Implementing the General Data Protection Regulation (GDPR), the new European law on data protection that will come into force in 2018, is the highest priority for CIOs in Belgium.
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Data from Belgian IT leader group Beltug shows that 63% of the country’s CIOs plan to make GDPR compliance a top priority in 2017. “Since April 2016, companies have known about the General Data Protection Regulation and the need to be compliant by 2018. Belgium has privacy regulations, but this new European law is stricter and has financial consequences. Companies are looking at how to comply,” said Daniëlle Jacobs, director at Beltug.
“Complying with national and European law and regulations is the most important driver for investing in ICT,” said Peter Vermeulen, an analyst at Pb7 Research.
But companies in Belgium have not progressed as far as the Netherlands with the digitisation of communication. “The Belgian customer is less ready for digital interaction,” he said. “The country is more regionally organised than countries such as the UK and the Netherlands, and personal communication is still important. This is making communication more analogue.”
Companies think moving to the cloud is the solution for becoming lean and mean. Spending on software is growing by 5% in the region, according to IDC, and much of the budget is being invested in cloud applications.
This is corroborated by Computer Weekly/TechTarget IT priorities 2017 research for the wider region, which revealed Benelux IT decision makers look set to get extra money for cloud services, with 56% expecting a bigger spend this year.
But Beltug research found that cloud is now giving the CIOs new concerns, including, for example, the ability to secure applications. “Everyone agrees that cloud is the infrastructure of the future,” said Jacobs. “New questions then arise, such as how to combine a cloud infrastructure with the existing IT, and what security risks there are.”
The movement to the cloud also means that most of the applications and processes are standardised, said Vermeulen. “The use of tailored applications is declining.”
Cloud applications are still mostly used for storage, according to a study by the Belgian government’s Federal Public Service Economy for small and medium-sized enterprises (SMEs).
It also said email is an increasingly important cloud service and more and more companies are using the cloud for accounting software or computing power.
The stage companies are at with the implementation of a cloud service or infrastructure depends on the sector. “All companies are thinking about how to use the cloud for their business,” said Jacobs. “But organisations with strict regulations aren’t as quick with implementations as companies without them. These include banks or health organisations which have to deal with personal data.”
IT outsourcing is another area that looks set to get a large portion of the budget. Spending on IT services in Belgium will increase 3% in 2017, according to IDC, with most of this on IT outsourcing.
Data from Beltug shows that most IT professionals in IT departments are employed by IT service providers, not the IT department of the organisation they support. “Companies have trouble finding the right skills. Compared with five years ago, organisations have much less IT knowledge,” said Beltug’s Jacobs.
The 2015 IT Outsourcing Study for Belgium and Luxembourg, carried out by Whitelane Research in collaboration with Vlerick Business School, found that 81% of the top 200 Belgium and Luxembourg-based organisations will continue to outsource at the same rate or more over the next 12 months. Focus on core business is the main driver for companies planning to outsource more, according to 70% of those surveyed.
Cost reduction is named the second biggest driver of outsourcing. One of the reasons organisations outsource is the strength of the Belgium labour unions, said Vermeulen. “It’s a less complicated way to let a lot of employees go. The reduction of the staff can be blamed on the supplier.”
Digitisation of customer interaction
Digitisation of the customer interaction is also on the agenda. CIOs working in Belgium’s public sector are busy introducing the digital signature standard eIDAS, which makes it safer to exchange documents with the government.
Meanwhile, the services sector is busy with mobile payments and identification. “Years ago, Belgium introduced an electronic ID, which was a great system,” said Jacobs. “But it never worked out that way, and now other countries are further ahead with electronic identification.”
Public and private parties are still discussing which payment system will be used for mobile payments. “With the growing mobile traffic, this is an important topic for the services sector,” added Jacobs. “Are we choosing Apple Pay, a Google payment system or the Belgium initiative for mobile payments?”
Due to the transformation of the digital customer interaction, an increasing amount of the IT budget is being spent by the business, although “most of the IT budget is still being spent by the CIO”, said Vermeulen.
ICT spending in Belgium is growing, but not as fast as countries such as the UK and the Netherlands. “Political and economic circumstances make the Belgian market less steady,” said Jan van Vonno, senior analyst at IDC.
“We often speak with the large technology suppliers, and some of their enterprise customers have established their offices in Belgium to be close to the European Parliament in Brussels. However, due to the low economic confidence, technology suppliers are telling IDC it can be difficult to sell big IT systems to enterprise companies in Belgium, and some of their customers appear to be considering moving out of the country.”