Basic purchasing and cost reduction remain the main economic drivers in the US and Europe, according to s study of 450 IT executives by International Data Corporation (IDC).
The study, sponsored by Getronics, did however suggest that 41 per cent of respondents expects to see IT spending on the up in 2003 with an equal number offering a worst case scenario of planning to spend at least the same as in 2002.
While customer retention is cited as top of the 2003 business agenda, current goals are pragmatically focused on cost savings. Some 67 per cent of respondents named decreasing cost as the business priority for mid-2002 through 2003, followed by 58 per cent citing increased profits and 52 per cent out to increase ustomer loyalty.
But yet again this latest survey reinforces the perception that companies have little or no idea about how to cost justify their purchases. Only 18 per cent of respondents said that they used a formal methodology for measuring return on investment with the US faring better than Europe where only 15 per cent of respondents were able to offer up an ROI policy.
There are other significant national differences. While security is easily the top priority for European companies, US firms place CRM at the top of their agenda with 39 per cent of respondents naming it, following by ecommerce on 35 per cent and ERP on 29 per cent. Globally CRM comes in third place, preceded by security and ecommerce.
Respondents said they use operational and cost-based evaluations, rather than financial metrics, to gauge the success or failure of IT investments. Half said that metrics such as projects being on time and on budget were enough to measure success. Other metrics included being able to cut costs and increasing productivity.
Some 41 per cent of respondents plan to increase spending by an average of 20 per cent in 2003. Most of the increases will be in infrastructure categories, such as hardware, software, telecom, networking, and systems integration. The most cited IT spending priority through 2003 is security, followd by ecommerce, CRM and ERP, although larger companies are more interested in CRM.
The study polled 458 IT decision-makers in the US, UK, the Netherlands, Spain, Italy, France and Germany in June and July of 2002. Forty percent of respondents report to the division or corporate CEO and 30 percent report to the head of IT. Multiple industries were included such as financial services, manufacturing, retail, pharmaceutical, energy, chemical, and telecommunications. Companies were larger in the US with at least $500 million in revenue while in Europe companies had revenue in excess of $100 million.