IT leaders seeing investment payback time slashed

Some CIOs have had return on investment periods halved - with others reporting approval only for projects that give a return within a month, says research

Short payback periods are becoming common

More than a third (37 per cent) of European IT leaders have had to reduce the amount of time to achieve a return on their technology investment as a result of the downturn, according to research.

Some chief information officers (CIOs) have seen payback time cut by 50 per cent or more, with others reporting that only purchases offering a return within a month are being approved.

The study by AT &T interviewed CIOs in Germany, France and the UK working for 30 large multinational companies, and suggests that some IT leaders are being forced to take drastic measures to reduce their spending.

“Currently we are trying to survive,” said one CIO quoted anonymously in the survey. “Our last goals for growth have been corrected downwards.”

Cutting costs or getting spending under control was the top priority among respondents, with survival and simply maintaining the status quo the second most important objective.

“Most European executives stated that IT plays an important role in supporting their company’s short-term business strategies,” said the AT&T report.

“IT has an important supporting role primarily because it helps identify inefficiencies that can lead to process improvements and a reduction in costs, both of which help companies achieve a return on investment. In today’s economic climate, a return on investment is extremely important.”