Companies slash spending on e-business

According to Forrester, the pressure is coming from corporate business executives rather than the IT departments. But it is software not hardware which is the main area where the big companies are cutting back.

Just over a quarter of companies surveyed will consider buying enterprise applications like CRM, supply chain management, procurement and ERP. This figure is down from 58% last year.

But enterprises are still buying hardware with 61 per cent saying they are considering purchasing storage equipment, servers, infrastructure software and bandwidth.

Forrester said the general e-business spending decline was a result of companies becoming more conservative and shrinking away from making ‘risky’ IT investments.

Tom Pohlmann, senior analyst at Forrester said that corporate decision-makers were trying to squeeze more value out of their prior technology investments.

‘Most companies will curb the number and types of technology products that they will consider buying in 2002,’ he said.

The report also discovered that IT consulting and services fell 28% in comparison to last year.

Related reading