conducted by

Conducted by Conducted by Phase II Quantitative Study Sept, 2001Phase II Quantitative Study Sept, 2001

http://www3.gartner.com/UnrecognizedUserHomePage.jsp

Business Technology Research


Summary of Phase I Key FindingsSummary of Phase I Key Findings

Economic Realities– Increased scrutiny on technology initiatives to “make or save money”

IT Professionals Most Influential in Process for All Technologies• Infrastructure = Everything “invisible or transparent” and “what it takes to power applications”

(servers, network hardware, bandwidth, collocation, OS, etc.)

• Back-office/network software = “Intelligence. Make it work.” (decision support, security, ERP, databases, content management, web site monitoring, etc. )

• Customer facing applications = “What users see and touch ” (CRM, HR or benefits, financial applications, ecommerce, etc. )

Importance of Functional IT/Specifiers for all Technologies– Critical in all steps of infrastructure purchases and in RFP/RFI stages of all other

purchases

Executive Management and Steering Committee Involvement Limited to 30,000 Foot View– Involved in setting strategic vision and in approval of large IT expenditures, not involved in

choosing brands and products



IntroductionIntroduction

Methodology and Audience– Research conducted by Gartner Griggs-Anderson on behalf of

CMP BTG

– Quantitative, phone interviews of 492 business technology professionals fielded July 15 – August 28, 2001.

– Respondents:

• Split between corporate and IT management.

• Recruited using CMP lists for IT professionals and D&B lists for corporate respondents.

• Screened for involvement in purchase process for specific technologies in the last six months.

• Reflect a variety of industry and company size– 40% 50-499 employees– 30% 500-4,999 employees– 30% 5,000+ employees



Why IT Projects are OverruledWhy IT Projects are OverruledBusiness ReasonsBusiness Reasons

0%

10%

20%

30%

40%

50%

60%

70%

80%

Budget Cuts Recommendationnot strategic

Poor businesscase

Lack of synergy w/other initiatives

Initiative cancelled No customer value

Small (<$100M revenues) Medium ($100M-$999M revenues) Large ($1B+ revenues)

Q: Under what circumstances did executive or corporate management, or a steering committee overrule the recommendation?

N= 182N= 182



IT is Feeling the HeatIT is Feeling the HeatYet, Companies Lack Formal Metrics

0%

10%

20%

30%

40%

50%

60%

Increased Remained the same

IT Corporate

Q: Has the need to measure ROI for IT projects increased, decreased or remained the same as compared to what it was 6 months ago?

IT N=162 corporate N=93

IT N=162 corporate N=93

Q: Does your company have a formal ROI measurement system or informal payback scenarios?

0%

10%

20%

30%

40%

50%

60%

70%

Formal Measurement Informal Measurement

N=240 N=240



Money Still Being Spent Money Still Being Spent Budgets, Increasing or Remaining the Same?Budgets, Increasing or Remaining the Same?

Q: Do you anticipate that your total IT budget will increase, decrease or remain the same in 2001 as compared to 2000?

N=321N=321

46%

25%

29%

Increase Decrease Remain the Same

NOTABLE DATA

Average increase: 26%

Average decrease: 22%

• 50% of mid-size companies expect an increase. The average increase is 18%.

• 31% of large companies. expect decreases. The average is 14%.

NOTABLE DATA

Average increase: 26%

Average decrease: 22%

• 50% of mid-size companies expect an increase. The average increase is 18%.

• 31% of large companies. expect decreases. The average is 14%.



0% 10% 20% 30% 40% 50% 60%

Digital convergence

Service providers and outsourcing

Mobile and wireless

Consultants

Network and system management

Back-office applications

E-Business

Customer-facing applications

Security

Data management and storage

Infrastructure hardware

Continued investment

Cancelled or put on back-burner

Q: In light of the current economy, what technologies are you continuing to invest in? What technologies do you consider “must buys” in the next 6 months? Q: What specific technology investments or projects have recently been cancelled or put on the back burner?

““Must Buys” versus “Back-Burner”Must Buys” versus “Back-Burner”Keeping the Business RunningKeeping the Business Running

N=492N=492



Business Initiatives Driving Technology:Business Initiatives Driving Technology: Must Make Money or Save MoneyMust Make Money or Save Money

Q. What are the top business initiatives driving the purchase of technology in the next 6 months for your company?

0% 10% 20% 30% 40% 50% 60% 70% 80%

Developing new products

Shortening time to market

Developing/deploying E-business initiatives

Developing new saleschannels and markets

Connecting withcustomers, suppliers

Giving employees betteraccess to information

Driving revenue

Increasing profit margin

Reducing costs

N=492N=492



Specific Technology ModulesSpecific Technology ModulesPurchase Process Involvement• Respondents involved in purchasing specific

technology in the last six months• Addressing (insert modules)

•Back-Office Applications

•Customer-Facing Business Applications

•Digital Convergence

•Infrastructure Hardware

•Security

•Back-Office Applications

•Customer-Facing Business Applications

•Digital Convergence

•Infrastructure Hardware

•Security

•Consultants

•Data Management and Storage

•Ebusiness

•Network Systems Management

•Mobile & Wireless

•Service Providers

•Consultants

•Data Management and Storage

•Ebusiness

•Network Systems Management

•Mobile & Wireless

•Service Providers



Information Sources Information Sources Used to Make Technology Decisions Used to Make Technology Decisions

• Business Publications• Conferences or Seminars• Consultants• Consumer Publications• Educational Institutions• E-mail Newsletters• General Daily Newspapers• Peers or colleagues• Radio• Research firms (reports)

• Business Publications• Conferences or Seminars• Consultants• Consumer Publications• Educational Institutions• E-mail Newsletters• General Daily Newspapers• Peers or colleagues• Radio• Research firms (reports)

• Research firms (consulting)

• Technology B-to-B Publications• Television (technology programs)

• Television (technology advertising)

• Trade Shows (vendor sponsored)

• Trade Shows (non-vendor sponsored)

• Web Sites (media or news)

• Web Sites (vendor)

• Research firms (consulting)

• Technology B-to-B Publications• Television (technology programs)

• Television (technology advertising)

• Trade Shows (vendor sponsored)

• Trade Shows (non-vendor sponsored)

• Web Sites (media or news)

• Web Sites (vendor)



Q: Which one of the following information sources do you find most valuable to you when you are [STAGE]?

Information Sources Used to Information Sources Used to Make Technology Decisions At Different StagesMake Technology Decisions At Different Stages

(Top 4 out of 18 )(Top 4 out of 18 )

IT Corporate IT Corporate IT Corporate IT Corporate1. Technology

B2B Pubs1. Peers or Colleagues

1. Technology B2B Pubs

1. Peers or Colleagues

1. Vendor Web Sites


1.Vendor Web Sites


2. Vendor Web Sites

2. Consultants2. Peers or Colleagues

2. Business Pubs


2. Vendor Web Sites

2. Tech/News Web Sites

2. Vendor Web Sites


3. Vendor Web Sites

3. Business Pubs



3. Consultants3. Technology

B2B Pubs3. Consultants

4. Business Publications


4. Vendor Web Sites

4. Consultants4. Tech/News

Web Sites4. Technology

B2B Pubs4. Peers or Colleagues


Evaluating and Specifying Products

Setting Business Objective Determining NeedDetermining Features and

Requirements



Q: Which one of the following information sources do you find most valuable to you when you are [STAGE]?

Information Sources Used to Information Sources Used to Make Technology Decisions At Different StagesMake Technology Decisions At Different Stages

(Top 4 out of 18 )(Top 4 out of 18 )

IT Corporate IT Corporate IT Corporate IT Corporate1. Vendor Web Sites


1. Vendor Web Sites


1. Vendor Web Sites





2. Vendor Web Sites


2. Consultants2. Peers or Colleagues

2. Consultants2. Vendor Web Sites

2. Consultants






3. Vendor Web Sites


3. Vendor Web Sites


4. Consultants4. Technology

B2B Pubs4. Business

Pubs


4. Business Pubs

4. Business Pubs


Recommending Products

Recommending Brands Authorizing or ApprovingEvaluating and Specifying

Where to Buy



Phase II FindingsPhase II FindingsSteering Committee/CXO Work with IT Executives in Setting Priorities and Direction

– Executive IT and corporate management determine strategy and vision which IT management translates into actionable technology initiatives.

– Steering committees/CXOs not involved in product or brand recommendations.

Centralization of Technology Budgets– Majority of companies have centralized IT budgets. Many have moved to centralization recently.

Companies Increasing Budgets; Focus on Back to Basics– Majority of companies report increased budgets, yet companies are evaluating initiatives according to

returns: “Makes Money or Saves Money”.

IT Professionals Most Influential in All Technology Categories– Purchase process changes based on technology, yet IT management and staff is involved in all

technologies and “own” core enterprise technologies.

B2B Technology Publications, Internet Sites and Peers/Colleagues Most Valuable Information Sources During Purchase Process

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