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STKI Israel's IT Market 2017
STKI Copyright@2017
• Dr. Schwarzkopf has worked during the last 40 years in all areas of Computer Information
Services:
• As an Industry Analyst at META Group (Israeli Research Manager) and was named a META Group Research Fellow.
• As an academic researcher in Entrepreneurship Sciences; has published and presented in the Academy of Management and
Babson Conferences and Editorial Board Member of the academic journal "International Journal of Opportunity, Growth and
Value Creation".
• As a consultant in Arthur Andersen Consulting (USA), Booz Allen (USA) and Kesselman & Kesselman. As a systems professional
in SCS Computers and the R&D Unit of the Israel Defense Forces.
• As a sales and marketing professional in Digital Equipment Corporation.
• Teaching in the MIS department / TelAviv Yafo Academic College and the Computer School of the IDF.
• Entrepreneur founding three companies in the IT arena: STKI, store and forward mail and office information systems.
• Dr. Schwarzkopf served on the Board of Directors of Ashot Ashkelon Industries, served as
President of the Gymnazia Herzelia Association, Co-founder of the Mashov Political Movement
and was a member of the Central Committee of the Labor Party. Major (Rav-Seren) in the
reserves, Israel Defense Forces (where he served in an elite unit and later in the R&D unit).
Registered Engineer (IS22881), member of MENSA Israel.
• Dr. Schwarzkopf received BSE and MSE degrees (Systems Engineering) from the University of
Central Florida. Received a MSIA (Management Information Systems) and ABD (PhD
Program) in Systems Science (received (twice) the William Larimer Mellon Scholarship/Award)
from Carnegie Mellon University. His doctorate (DM-Management/ Entrepreneurship) he
received from Case Western Reserve University.
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STKI Israel's IT Market 2017
STKI Copyright@2017
STKI’s goal is to help our clients make the right choices in the strategic
and financial management of their information technology systems.
Founded in 1992, STKI is the leading market research and strategic analyst firm in Israel, covering the IT infrastructures, IT applications and IT services industry .
Over 25 years of experience in the IT analyst sector and thousands of annual face-to-face interviews with key industry participants have enabled us to establish solid,
long-standing relationships with our customers.
Our customers include major IT organizations (government, financial institutions, telecoms, manufacturing, medical, education, etc.) and IT suppliers/vendors
(infrastructure and software suppliers, consulting and professional services firms).
STKI works closely with vendor senior management (strategy, business development, and marketing).
Where end users are concerned, STKI meets with CEOs, CFOs, CMOs, CDOs and CIOs (as with all levels of IT decision making) thereby attaining complete information
of technology innovation as well as business transformation.
STKI's mission is to advise and analyze users of information technology as well as their suppliers while conducting original research and providing advisory services
regarding all parts of the information system puzzle.
Israel's foremost IT companies have come to rely on STKI's market-proven experience and expertise.
Our services include:
•
Face-to-face meetings
STKI Analyst House Calls (for both users and vendors)
CIO STKI "Help Desk"
Inquiries
Surveys
Strategic Marketing & Positioning
Round Tables for users
Vendor Discovery Series (Newsletters and workshops)
Vendor Innovation Workshops
In-house Workshops
CIO Annual Bootcamp
CTO Annual Bootcamp
Brainstorming Workshops
STKI Annual Summit
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STKI Israel's IT Market 2017
STKI Copyright@2017
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- The document summarizes Dr. Schwarzkopf's background and experience in computer information services, academia, consulting, sales, marketing, teaching, and entrepreneurship. - It describes his roles founding three IT companies and serving on various boards and committees. - It lists his educational background including degrees from the University of Central Florida, Carnegie Mellon University, and Case Western Reserve University.

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STKI Israel's IT Market 2017
STKI Copyright@2017
STKI Methodology: equilibrium model
The sum of all IT expenditures (from users)
has to be equal to all IT sales (from vendors).
most research firms are either a
"demand-based"
(market information based on data from users of IT)
"supply-based"
(market information based on data from IT vendors).
STKI is one of the only research firms using an equilibrium model
and the only one in Israel.
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STKI Israel's IT Market 2017
STKI Copyright@2017
› Real revenues of software licenses and maintenance.
› Real revenues of hardware sales.
› Differentiation between new projects and continuing projects. New projects count
more.
› We do not include any work/ products for OEMs and military non-IT projects.
› We are learning how to account for cloud usage for IT (Israel) only
› We distinguish between work done by the vendor's employees and work
outsourced to another vendor. The revenue is transferred to the vendor actually
doing the work.
› Distinguish revenues from projects done in fixed price, cost plus (SLA defined) and
staff augmentation (non SLA) projects.
› Differentiate value between work done by high level internal professionals in a
project and staff augmentation employees in the clients IT department.
Take into consideration IT department’s view/mindshare of
vendor’s value in projects/products
What our study looks at:
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STKI Israel's IT Market 2017
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Dr. Schwarzkopf has over 35 years of experience in various areas of computer information services including as an industry analyst, academic researcher, consultant, systems professional, sales and marketing professional, and entrepreneur. He has founded three IT companies. Dr. Schwarzkopf also served on various boards and committees. He holds multiple advanced degrees in related fields from universities in the US and Israel.

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Over 65% is BAD
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STKI Israel's IT Market 2017
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STKI Summit 2017
Israeli IT Market 18
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STKI Israel's IT Market 2017
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number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
% of
TOTAL
number of
companies
(paying
taxes)
% of
TOTAL
21-100 3,871 4,088 16,305 16,647 51-100 4,352 1.69% 21-100 17,995 6.98%
6-20 31,720 33,073 46,920 48,780 10-50 36,268 14.06% 6-20 52,265 20.27%
up to 5 196,802 194,683 175,925 180,445 up to 9 212,985 82.59% up to 5 192,641 74.70% 192,641
ACCORDING TO
BITUACH LEUMI
2/2012
ACCORDING TO
BITUACH LEUMI
2/2013
ACCORDING TO
BITUACH LEUMI
2/2014
ACCORDING TO
BITUACH LEUMI
2/2015
201620152014
250,011
ACCORDING TO BITUACH LEUMI 2/2016
subtotals
1,622 0.63%
4,374
2,752 1.07%
70,260
262,901
267,275
ACCORDING TO BITUACH LEUMI 2/2017
101-2502,685 1.04%2,606
2011
number of
employees
v1
251+ 1,583 0.61%1,533 251+1,4761,348
257,873
number of
employees
v2
totals
251+
101-250
2012
1,493
2,525
2013number of
employees
v1
232,393 235,773 243,168
2,4532,384 101-250
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STKI Israel's IT Market 2017
STKI Copyright@2017
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
number of
companies
(paying
taxes)
% of
TOTAL
number of
companies
(paying
taxes)
% of
TOTAL
21-100 3,871 4,088 16,305 16,647 51-100 4,352 1.69% 21-100 17,995 6.98%
6-20 31,720 33,073 46,920 48,780 10-50 36,268 14.06% 6-20 52,265 20.27%
up to 5 196,802 194,683 175,925 180,445 up to 9 212,985 82.59% up to 5 192,641 74.70% 192,641
ACCORDING TO
BITUACH LEUMI
2/2012
ACCORDING TO
BITUACH LEUMI
2/2013
ACCORDING TO
BITUACH LEUMI
2/2014
ACCORDING TO
BITUACH LEUMI
2/2015
201620152014
250,011
ACCORDING TO BITUACH LEUMI 2/2016
subtotals
1,622 0.63%
4,374
2,752 1.07%
70,260
262,901
267,275
ACCORDING TO BITUACH LEUMI 2/2017
101-2502,685 1.04%2,606
2011
number of
employees
v1
251+ 1,583 0.61%1,533 251+1,4761,348
257,873
number of
employees
v2
totals
251+
101-250
2012
1,493
2,525
2013number of
employees
v1
232,393 235,773 243,168
2,4532,384 101-250
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In order to get the “IT Market” (what is bought/sold out there) :
What users bought?
From whom?
Why?
IT Departments IT Vendors
How much did they sell?
To whom?
For how much?
Competitors?2013
2014
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3.61%
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SOFTWARE
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6.72%
1,441,000
VALUE ADDED
SERVICES
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4.48%
3,266,000
TOTAL
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4.73%
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25 years of
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Comparison
Budgets 2013-2017**
**We expect increase mid 2017 for
“digital initiatives”
not on IT budget now
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VARs or Partners:
NO double bookings for IT market size forecasts
Value Added Resellers
“VAR or Partners”
are incorporated into
STKI’s “TIERS”.
Both sell into the Israeli
Market.
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STKI Israel's IT Market 2017
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Products “sold” on the cloud
STKI “books” in on-premises software categories
NO double bookings for IT market size forecasts
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This document discusses smart analytics and big data. It begins by defining the 5 V's of big data: volume, velocity, variety, veracity, and value. It then discusses how analytics can provide competitive advantages for organizations and how the percentage of organizations realizing this advantage has increased significantly in recent years. The rest of the document discusses IBM's work in areas like smarter cities, smart service systems, and T-shaped professionals who have expertise across multiple domains. It provides examples of the large amounts of data being generated and concludes with a discussion of modeling holistic service systems at different levels from an individual to the entire planet.

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quantumfaxmachine
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Digital Output Management/Customer Communication Management
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STKI Israel's IT Market 2017
STKI Copyright@2017
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Business Applications 1
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2014 2015 2016 2017 2018 2019
ERP 145,000 -1.38% 143,000 -2.10% 140,000 -1.43% 138,000 -2.90% 134,000 -2.99% 130,000
Vertical (Core Business) Applications 125,000 10.40% 138,000 12.32% 155,000 9.68% 170,000 8.82% 185,000 5.41% 195,000
CRM/XRM 45,000 11.11% 50,000 16.00% 58,000 12.07% 65,000 12.31% 73,000 8.22% 79,000
HR/ Talent Mgmt/ LMS 11,500 17.39% 13,500 18.52% 16,000 11.88% 17,900 11.73% 20,000 15.00% 23,000
326,500 5.51% 344,500 7.11% 369,000 5.93% 390,900 5.40% 412,000 3.64% 427,000
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Business Applications 1
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STKI Israel's IT Market 2017
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Business Applications 1
ERP Software (all sizes)
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quantumfaxmachine
Business Applications 1
CRM/XRM
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Business Applications 1
HR/ Talent Mgmt./ LMS / PAYROLL
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Business Applications 2
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Business Applications 2
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Contact Center and Multi channel engagement tools (chat, bots, Video etc…)
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Marketing Automation Software
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STKI Israel's IT Market 2017
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Web Content Management + e-Commerce Platforms
107
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IoT tools and platforms
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STKI Israel's IT Market 2017
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STKI Summit 2017
Israeli IT Market 109
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Value Added Services Market 2014-2019
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Vendors that sell in the VAS markets
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"Enterprise" CONSULTING:
advice in a particular area not
AUGMENTATION (gulgalot) or IMPLEMENTATION
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STKI Israel's IT Market 2017
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"Enterprise" CONSULTING:
advice in a particular area not
AUGMENTATION (gulgalot) or IMPLEMENTATION
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STKI Israel's IT Market 2017
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IT Strategy Consulting & Analysts Services
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Digital Transformation Consulting
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117
(Big) Data Consulting
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IT Infrastructure/Delivery Consulting
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IT Application Consulting
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Cyber/Security Consulting
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Infrastructure Projects
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Hardware/ Data Center Environment/ Networking Projects
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Project Management Services
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Project Management Services
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ALM Q/A & Testing
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IT Training
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HatMaa
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CRM-XRM (on premise/cloud)
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Contact Center and Multi channel engagement tools
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Data, BI, Analytics
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Data, BI, Analytics
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Marketing Automation (on premise/cloud)
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Business Applications Implementation 2
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“general” software development
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SaaS implementations
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Migrations
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Business Applications Implementation 3
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Business Applications Implementation 3
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Business Applications Implementation 3
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Business Applications Implementation 3
Core Vertical Package Implementation
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Business Applications Implementation 3
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Business Applications Implementation 4
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Knowledge Management (ECM, Portals)
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Web & eCommerce
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Web Accessibility
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Managed Services and Outsourcing Services
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Managed Services and Outsourcing Services
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Managed Services and Outsourcing Services
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165
Managed Services and Outsourcing Services
Off-site Data Center (Operational/DRP). (Client owns the HW)
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STKI Israel's IT Market 2017
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Managed Services and Outsourcing Services
Help Desk Outsourcing Services
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STKI Israel's IT Market 2017
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167
Managed Services and Outsourcing Services
Cyber security managed services ( SIEM service)
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STKI Israel's IT Market 2017
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Managed Services and Outsourcing Services
Printing Outsourcing Services (pay per click)
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STKI Israel's IT Market 2017
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169
On-Demand or Cloud Services
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Business Services as a Service- BSaaS (Salaries, Payments, BPO, etc)
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Platform as a Service PaaS/ Infrastructure as a Service IaaS
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STKI Israel's IT Market 2017
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(PARTNERS) Platform as a Service PaaS/ Infrastructure as a Service IaaS
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Software as a Service SaaS
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STKI Israel's IT Market 2017
STKI Copyright@2017
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DRP as a Service
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Staff Augmentation Services
176
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177
177
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Gulgalot on-premises & Gulgalot off-premises (Nearsite)
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STKI Israel's IT Market 2017
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Nearshore
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STKI Israel's IT Market 2017
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STKI Israel's IT Market 2017
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Digitally signed
by Dr Jimmy
Schwarzkopf
Location:
Date: 2017-03-23
10:44+02:00

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STKI 25th Annual Israel IT Market Study 2017