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RealTime IT News

CIOs Question Internet ROI

Most businesses feel that going online has failed to contribute to the bottom line, according to the results of a Deloitte Consulting survey of nearly 500 North American Chief Information Officers (CIOs).

"Internet reality hit in 1996," says Don Thompson, a Partner at Deloitte Consulting and Canadian leader of the firm's Electronic Commerce/Internet practice. "Businesses began to realize that they were not getting an adequate return on their investment and the number of CIOs that felt that Internet costs were a significant concern jumped from 16 percent to 61 percent."

Cost concerns might not have mattered had Internet usage contributed to the bottom line. However, the number of CIOs concerned about the Internet's lack of proven business benefits continued to rise.

"Most of the businesses that made heavy investments in the Internet failed to develop a true Internet strategy," says Thompson. "They saw the technology as a strategy in itself rather than a tool for aiding business, and that was a costly mistake."

Disappointed with the lack of return on their investments, businesses have begun to slow their Internet spending. The number of CIOs budgeting for significant increases in Internet spending has dropped from 65 percent to just 31 percent, with 17 percent of CIOs projecting no increase in spending and 1 percent projecting a slight decrease.



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