Thursday, September 12, 2002

2002 ROI leaders and laggards

A new study by Nucleus Research, a vendor-neutral research firm, indicates which IT initiatives have the highest and lowest ROI, based on thousands of ROI studies that the firm has done worldwide. The study found that the highest ROI is currently coming from the following:
  1. E-business integration platforms, using EAI solutions such as BEA Weblogic and Microsoft Biztalk. Other EAI vendors include NEON, SeeBeyond, TIBCO, Vitria, webMethods (Active Software), Peregrine (Extricity), Iona (Netfish), and IBM (Crossworlds). Although the study did not clearly indicate, I would expect both internal application integration as well as external integration with trading partners to be high ROI opportunities, as indicated by the high degree of interest in this subject among CIOs in the trenches. (See my post on August 22).

  2. E-learning solutions, due to "reduced costs for travel, human resources overhead, regulatory compliance and customer support costs," along with second tier benefits, such as increased employee performance that directly impacts profitability. The study found that most companies could gain significant returns from even modest investments in e-learning technology. I wrote about this point in terms of web-conferencing and listed some vendor solutions back in June.
In contrast, the study found that the lowest return came from three types of initiatives:
  1. E-commerce and B2B marketplaces. The study found that companies are currently off better by investing in specific integration strategies with key partners.

  2. Monolithic CRM. The study found that companies investing in large CRM projects are unlikely to achieve a positive ROI, because consulting and software costs often outweigh returns and a long deployment process slows payback. Most companies are better off investing in smaller CRM initiatives and expanding them as warranted.

  3. Standalone content management. The study found that the high cost of content management solutions are not warranted for most companies. Those companies that do acheive positive ROI on content management projects are doing so as part of a broader strategy with tight integration.
Additional details on the study can be found in the firm's press release.