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.