Mumbai: AT&T Inc has announced that the integration of communications and IT networks is critical to making global expansion work, according to the results of a global survey conducted by the Economist Intelligence Unit (EIU) on behalf of AT&T.

The worldwide survey of 497 senior executives reveals that 42 per cent of firms will be deriving half or more of their revenue from foreign markets within two years, compared to 30 per cent of firms that can claim this today.

Emerging markets such as China and India figure prominently as the overseas destinations of greatest interest, but developed nations - especially the United States - also continue to be of focus for companies aiming to expand in the global marketplace.

Key findings also show that mergers and acquisitions (M&A) are highly favoured as a growth vehicle by respondents - 40 per cent considered this part of their company''s international growth strategy during the next two years. However, the difficulty of integrating communications and IT networks is identified as a common M&A pitfall by 13 per cent of those polled. IT and network integration can indeed make or break a cross-border merger.

Overall, the survey exposes the centrality of IT and network capabilities to successful globalisation. Companies today realise their growth abroad must be supported by corresponding IT and network investment.

To enable expansion, one in five companies plans to increase investment in its network during the next two years by more than 25 per cent , and another 43 per cent of surveyed executives say their companies will boost spending between 10 per cent and 25 per cent .

"It is clear from this research that globalisation is really hitting its stride," said Gopi Gopinath, vice president of AT&T Asia Pacific. "Where global expansion is concerned, M&As seem to be particularly favoured by senior executives. And a crucial part of an M&A is how the technology is put together. The advanced IP networking technologies available today make possible a level of visibility and control of disparate global operations not available a decade ago, and these make it much more effective for transition and integration and, ultimately, a successful M&A."

"The potential rewards of global expansion are immense, from revenue windfalls in high-growth emerging markets to substantial efficiencies from the use of overseas suppliers and services providers," said Denis McCauley, director of Global Technology Research with the Economist Intelligence Unit. "But in order to harness this, companies need to think not only about using clear management thinking and flexible structures but also the right technology for the job."

As part of the research for the paper, the Economist Intelligence Unit conducted an online worldwide survey of 497 senior executives across 49 countries and over 20 industries. The majority of respondents came from:

• Asia Pacific 31.8%
  Western Europe 23.3%
• North America 20.9%.
• Other respondents came from Eastern Europe, Latin America, the Middle East, and Africa.
• 53.2% of those polled hailed from large firms with annual revenue of more than $500 million.
• The top five industry sectors represented by the survey respondents were professional services, financial services, healthcare, biotechnology and pharmaceuticals, IT and technology, and manufacturing. In addition to the survey research, the EIU conducted a series of one-to-one in-depth interviews with senior executives and analysts.