How time flies ... It was just a few months ago when executives were consumed with cost-cutting and wringing every bit and byte of efficiency as possible out of their IT investments. Things had been quite rocky with the economy, and nobody knew what was going to happen with their budgets.
Suddenly, as the economy seems to be poised for a new phase of growth, business IT priorities have also shifted. Gartner, for one, just issued a report that observes that there has been a major shift in CEO priorities from early in 2009 “with top priorities switching from cutting costs to retaining customers and enhancing existing relationships.”
Don't expect corporate purse strings to suddenly start loosening as well, however. Through 2015, Gartner predicts that a recession-era mentality among CEOs will ensure a policy of paying for future investments from the cost savings obtained from existing IT operations.
A tight spending scenario for the insurance sector has been confirmed in various industry surveys, including those from the Property Casualty Insurers Association of America and Novarica.
So the challenge is to stay focused on the customer, without additional funding to do so. As Gartner puts it: “IT has a significant role to play here because it needs to deliver insights for the business to enable it to effectively navigate the changes ahead. That means IT must make investments in understanding customer intent, predicting the impact of business conditions and connecting strategy to outcomes.”
It seems many business leaders were impressed by the performance of their IT systems in the midst of the recent economic meltdown. McKinsey & Co. research, for one, shows that n the wake of the recent economic hurricane, many non-IT executives seemed to have developed a healthier appreciation for their information technology functions. Business executives, overall, seem pleased with the way IT helped organizations navigate the rough seas. It was the IT leaders, however, feel they could be doing better.
Still, with tight budgets and demands for greater levels of engagement with customers, it looks like many companies will be relying ever more increasingly on social networking strategies. As reported here in INN, many insurers are starting get their feet wet in social networking approaches to better inform and get feedback from customers. This is the next frontier for corporate IT departments.
Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.
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