When we asked more than 250 CFOs whether they are devoting more time to IT issues these days, a resounding majority said yes. When we asked them whether their companies have gotten the expected ROI from technology investments, almost half said no or rarely. And when we asked about their views on economic recovery versus their own company's future...well, their views may surprise you.
CFO magazine and Morgan Stanley surveyed 252 executives between July 30 and August 20. Respondents were primarily CFOs (34%), directors of finance (18%), controllers (15%), VPs of finance (13%), business managers (5%), CIOs or equivalents (6%), and senior executives (3%). Twenty percent work in manufacturing, 12% in service industries, 10% in finance/insurance, and the balance across a range of industry classifications. Two-thirds of respondents work at companies that employ 1,000 or more people. About half work at companies with at least $500 million in annual revenue, which we used as the dividing line between "large companies" and "small/midsize businesses." Nearly half the respondents reported IT expenditures in 2001 of $5 million or more. Numbers may not always equal 100% or may show other slight discrepancies due to rounding.
Do you find yourself playing a greater role in IT purchasing and/or strategy issues than you did a year ago?
| | Large companies | Small/midsize businesses |
| Yes, significantly more | 28% | 20% | 34% |
| Yes, moderately more | 45% | 53% | 39% |
| No | 27% | 27% | 27% |
Have your technology expenditures produced the returns on investment you expected?
| | Large companies | Small/midsize businesses |
| Yes | 14% | 11% | 17% |
| Usually | 43% | 41% | 42% |
| Rarely | 25% | 25% | 24% |
| No | 19% | 23% | 17% |
Do you believe your organization procured an excess of technology over the past three years relative to current needs?
| | Large companies | Small/midsize businesses |
| Yes | 10% | 9% | 11% |
| Probably | 14% | 20% | 8% |
| Not sure | 3% | 69% | 80% |
| No | 74% | 4% | 2% |
Is your company consolidating the number of technology suppliers it uses?
| | Large companies | Small/midsize businesses |
| Yes | 48% | 60% | 37% |
| No | 44% | 34% | 54% |
| Not sure | 8% | 6% | 9% |
If yes, why? (multiple responses permitted)
| | Large companies | Small/midsize businesses |
| Reduce complexity of vendor management | 59% | 62% | 57% |
| Reduce technical complexity of integration | 58% | 64% | 50% |
| Leverage volume discounts | 52% | 53% | 50% |
| Create more strategic partnerships | 43% | 46% | 41% |
Vendors offer more products,
facilitate1-stop shopping | 23% | 20% | 30% |
| Other | 3% | 2% | 5% |
Is your company expending more effort to evaluate the financial viability of the vendors you use?
(Editor's note: You can look into the working capital management of thousands of public companies with the CFO PeerMetrix interactive scorecards.)
| | Large companies | Small/midsize businesses |
| Yes | 37% | 41% | 31% |
| No, we always did this | 42% | 37% | 45% |
| No, we deal only with large vendors | 15% | 16% | 17% |
| Not sure | 7% | 6% | 7% |
Do you plan to spend more on technology products and services in 2002 than in 2001?
| | Large companies | Small/midsize businesses |
| Yes | 44% | 40% | 51% |
| No | 49% | 54% | 45% |
| Uncertain | 7% | 6% | 4% |
Who is ultimately responsible for authorizing IT spending in your company?
| | Large companies | Small/midsize businesses |
| CEO | 48% | 42% | 55% |
| CFO | 28% | 22% | 33% |
| CIO | 11% | 20% | 4% |
| CTO | 4% | 3% | 4% |
Business-unit
head(s) | 9% | 14% | 3% |
Has the ongoing news about the slow economy and the stock market decline caused you to reevaluate your technology budget/spending plans within the past month?
| | Large companies | Small/midsize businesses |
| Yes, will spend less than was budgeted at start of year | 20% | 27% | 12% |
Yes, will spend more slowly, adopt a
wait-and-see mode | 19% | 13% | 23% |
Yes, lowered the approval authority for
most employees; personally reviewing
more expenditures | 5% | 4% | 8% |
No change, but monitoring the situation
closely and evaluating whether to reduce
or delay spending | 34% | 41% | 31% |
| No change to our original plan | 18% | 14% | 20% |
| Yes, doing smaller deals | 4% | 2% | 6% |
If your company's profit picture improved in the next three to six months would you increase your spending on IT over currently planned levels?
| | Large companies | Small/midsize businesses |
| Definitely | 10% | 6% | 14% |
| Probably | 29% | 26% | 36% |
| Probably not | 51% | 58% | 42% |
| Definitely not | 10% | 6% | 3% |
| Unsure | 5% | 4% | 5% |
Have you begun to assess your 2003 IT budget yet?
| | Large companies | Small/midsize businesses |
| Yes, as of now it's likely to increase over 2002 | 30% | 24% | 36% |
| Yes, as of now it's likely to remain flat compared with 2002: | 39% | 42% | 32% |
| Yes, as of now it's likely to decrease compared with 2002 | 11% | 18% | 6% |
| No, budget process has not begun | 21% | 16% | 25% |
Has the ongoing scrutiny of corporate governance and auditing issues translated into a more cautious capital-spending strategy for your company?
| | Large companies | Small/midsize businesses |
| Yes | 22% | 27% | 19% |
| No | 73% | 65% | 79% |
| Not sure | 6% | 8% | 3% |
What is your outlook on the current state of the U.S. economy?
| | Large companies | Small/midsize businesses |
| Positive | 10% | 7% | 14% |
| Slightly positive | 42% | 43% | 43% |
| Neutral | 29% | 29% | 28% |
| Negative | 18% | 21% | 16% |
What is your current outlook on your company's business prospects?
| | Large companies | Small/midsize businesses |
| Positive | 39% | 38% | 42% |
| Slightly positive | 37% | 36% | 38% |
| Neutral | 15% | 16% | 14% |
| Negative | 9% | 10% | 6% |
When do you expect the economy to improve?
| | Large companies | Small/midsize businesses |
| 3Q02 | 4% | 4% | 4% |
| 4Q02 | 18% | 17% | 19% |
| 1Q03 | 23% | 23% | 24% |
| 2Q03 | 33% | 33% | 33% |
| 3Q03 | 10% | 9% | 11% |
| 4Q03 | 12% | 14% | 9% |
