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Strategic IT Spending in Economic Downturns |
| During economic downturns it's critical for businesses to evaluate both their business strategy and their spending. Strategic spending should be directed to those items providing shorter turnaround times for return on investment (ROI). With lending opportunities reduced, quick turnaround is critical to keeping your business liquid and mobile in a stressed economy.
Your business strategy should reflect what you do best and capitalize on these strengths in the new market economy. Strategic spending should be driven by creative, out of the box business strategies that look at current economics and find solutions to current problems.
What should you be spending your IT dollars on in an economic downturn? Should you be planning major expenditures? Probably not, but don't overlook lower cost solutions that can help boost sales and productivity.
What technology improvements can you make that will reduce costs, increase revenue and improve customer service?
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| - Enhancements to software to streamline current business processes.
- Improved online customer tools to reduce support costs and build customer loyalty.
- Integration projects to reduce dual entry and repetitive work, improving efficiency.
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What innovations will give you a competitive advantage and a leg up in the market? |
| - Online customer support functions that allow customers to place, view and track their own orders.
- Sales forecasting tools to expedite planning and free your sales team up to spend more time selling.
- Better reporting tools to improve visibility for timely decision making.
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One of our recent projects was to develop an online photo purchasing module to extend our client's work flow software. They were paying a third party vendor 11% of sales to use their online tool with poor administrative functions which resulted in operational inefficiencies. Our custom solution handles their special photo and administrative needs; they will recoup their entire investment the first year and realize an ongoing 11% increase in sales with a 20% reduction in labor costs.
Another example of a low cost project with an immediate ROI was a quick one week enhancement project that refined our client's credit card processing giving them a 4 times ROI in the first year. What used to take 7 hours is now done at the click of a button.
Strategic IT spending is thoughtful, well targeted and requires a short term ROI to keep your business moving forward, growing and improving even during uncertain economic times. What is your spending strategy?
Wende Jones has held top level managment positions for over 20 years serving as CIO, CFO, CEO and other top level positions. She now owns Agile Northwest, building web technology solutions for businesses. Wende has helped many companies across several industries meet their business strategies with technology innovation and improvements. |
| | Printable pdf | |
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