Where to Invest to Survive?

Investing in a portal is the most strategic IT decision in an organization

As the world economies slow down and the numbers of reported redundancies rise, the Butler Group observes that organizations are planning significant investments in IT systems and services. The key areas appear to be portal technology, e-commerce, and customer self-service applications. All rely on the Internet for their delivery. Many companies realize that their survival may depend upon exploiting the lower cost these technologies can offer.

The big picture. Cutting the cost base is seen as a key survival tactic, and this means reducing headcount. But who looks after the customers? Those described as ‘headcount’. If such headcount is in the call center, then companies can get into a vicious circle of reducing call-center staff to reflect falling revenues; reducing transactions because customers are dissatisfied with level of response, etc. This is not a sensible route to survival, for as was said recently, “you can’t make customers redundant”.

Providing alternative methods for sales and support at lower cost via the Internet is regarded as an ideal option for squaring the circle. E-commerce applications are seen as essential to reduce the cost-base. Self-service applications, such as allowing the customer to find answers to their queries without having to listen to Vivaldi whilst waiting for the ‘customer-service representative’, both improve customer satisfaction and stimulate call-center staff who are not deluged with ‘boring’ calls.

Bringing these two together through a portal, and potentially using workflow technologies to prompt a customer with a query into making additional purchases, is an obvious approach to maximizing the benefits of the respective investments. A key element of portal technologies is ‘stickiness’. Holding the customer’s interest through personalization and response, and hopefully getting them to undertake additional business. More than 50 percent of European enterprises will be deploying significant Web-centric applications by the end of 2002.

Butler Group’s Opinion. The fact that companies have been so quick to lose ‘headcount’ is testimony to the present problems. Undoubtedly there will be a re-alignment of businesses before the sigmoid curve returns to growth. That re-alignment, requires the strategic investments in Web-centric technologies that we are now seeing.

Excerpted from OpinionWire by Butler Group (c) Butler Group Direct