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November 25, 2009

Strategic Companies Invest More in IT to Combat the Recession: RONIN Report

RONIN (News - Alert) Corporation, a global market research and marketing consulting firm, has reportedly released a new study result which indicates that in order to combat the recession, “strategic” companies are investing more in IT, and have more advanced technology in place and regard IT as more strategically important than their “short term” counterparts.

As companies across the globe are planning opposing strategies while they emerge from the recession, RONIN’s study reveals that in the United States, 58 percent are employing tactical, short-term initiatives that include; cost cutting and deferred investments and longer-term planning. The other 42 percent are taking a more strategic view by re-engineering their business models, making acquisitions and forging new relationships.
RONIN officials said that, in the past recessions, the strategic companies had reportedly emerged to be stronger while the short term companies emerged with weaker competitive positions.
According to study analysts, outside the United States, the percentage of strategic companies is higher, except in Japan, and the emerging markets covered in the study – in China, Brazil and Mexico – show an even higher percentage of strategic companies.
The recession has caused a change in what IT buyers look for from vendors, research officials said. While there was a significant emphasis on low cost in the early days of the recession, the emphasis has now shifted to a desire to work with vendors that have a long-term strategic vision, best-in-class and innovative solutions and are easy to do business with. Lowest cost is well down the list of priorities.
RONIN’s study also indicated that the decreased level of spending in short term companies have outstripped the gains in the strategic companies. 2010 could shape up as a bumper year for vendors, particularly if they are targeting the strategic companies, research officials said.
Additionally, RONIN had conducted this third phase of the ongoing program studying “the impact that the current worldwide recession had on companies’ IT initiatives in early October 2009. Over 4,900 surveys were said to have completed over the three waves by IT decision-makers both in IT Departments and in the lines of business across 12 countries including; U.S., Canada, Mexico, Brazil, Germany, U.K., France, Italy, Spain, China, Japan, and Australia.

Jai C.S. is a contributing editor for TMCnet. To read more of Jai's articles, please visit his columnist page.

Edited by Kelly McGuire


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