Independent ROI Studies From Nucleus Research Prove E-learning Solutions and Integration Platforms Were Best Corporate IT Investments in 2002; E-marketplaces and CRM Among Worst

Business Wire, Sept 9, 2002

Business Editors

WELLESLEY, Mass.--(BUSINESS WIRE)--Sept. 9, 2002

Based on Thousands of Trusted, Accurate

and Ongoing End-User ROI Studies, Global Research Firm Defines

the Best and Worst Performing Technologies of 2002

Nucleus Research (www.NucleusResearch.com), an independent research firm providing financial analysis on corporate information technology (IT) investments, today unveiled its "ROI leaders and laggards" among enterprise technologies for 2002. The firm, which recently expanded its Massachusetts headquarters, reports that e-learning solutions and e-business integration platforms provided the greatest ROI for companies in 2002, while e-commerce and business-to-business marketplaces, monolithic CRM systems and standalone content management solutions provided the least. These findings are based on the thousands of ROI studies Nucleus has performed on behalf of Global 2000 companies.

Among the ROI leaders, Nucleus found the following:

-- E-business integration platforms -- These platforms, which include Microsoft BizTalk Server and BEA WebLogic Integration, allow companies to get more out of their existing IT infrastructures both through internal and B2B integration. Nucleus' studies show that they reduce costs, increase performance and ultimately generate new revenue streams that translate into increased corporate earnings. As companies take a hard look at technology spending, e-business integration enables them to take advantage of existing systems and applications to deliver greater returns.

-- E-learning solutions -- Nucleus Research shows that customers implementing these solutions have quickly recognized first-tier benefits, including reduced costs for travel, human resources overhead, regulatory compliance and customer support costs; and eventually received second-tier benefits, such as increased employee performance that directly impacts profitability. Nucleus found most companies could gain significant returns from even modest investments in e-learning technology.

According to Nucleus' research for 2002, the "ROI laggards" included:

-- E-commerce and business-to-business marketplaces -- Companies

that have invested in marketplaces to attract many new

partners have found limited returns -- they would have been

better off investing in specific integration strategies with

key partners.

-- Monolithic CRM -- Companies investing in large CRM projects

are unlikely to achieve a positive ROI, because consulting and

software costs outweigh returns and a long deployment process

slows payback. Companies are better off investing in rapidly

deployable CRM solutions with a smaller footprint and

extending them over time as business objectives dictate.

-- Standalone content management -- The growth of content

management functionality in many Web server and portal

products, and the higher costs associated with deploying and

integrating a standalone content management solution, make

standalone content management a bad investment for most

organizations. Customers achieving high returns from content

management are doing so as part of a broader strategy with

tight integration.

Nucleus Research: Setting the Standard in ROI

CIOs and CFOs alike are paying more attention to the role of technology implementations on their companies' bottom lines. A recent poll of information technology decision makers from Ernst & Young showed that while financial justification of IT projects is important, only 40 percent are actively researching these ROI figures. Most lack the time or expertise to conduct their own ROI analysis. Most are skeptical of simplistic and "loaded" ROI calculators sponsored by the vendors themselves or analyst firms that provide ROI frameworks on behalf of the technology vendors.

Nucleus Research combines comprehensive technology expertise with sound and accepted principles of financial analysis to provide companies with truly accurate and untainted ROI information on their IT investments. Unlike typical IT analyst firms, Nucleus Research's ROI methodology is not influenced by vendor dollars and is based on a long-term, iterative process where the numbers are constantly refined with new data. This enables Nucleus to provide companies with the ongoing financial information they need to effectively manage IT systems across the entire lifecycle, from planning and selection through deployment, upgrading and retirement.

"Nucleus Research is a new breed of analyst firm, the first that couples a broad knowledge of enterprise technologies with solid financial analysis skills," said Ian Campbell, co-founder and principal analyst for Nucleus Research. "We are not in business to forecast markets or technologies, or sell simple software tools. Instead, we are utilizing a comprehensive standard for measuring ROI in order to provide our customers with individualized advice and realistic cost/benefit projections of the bottom-line impact of their technology implementations."

Nucleus has ROI practices that address specific technology families, including Web services, e-commerce applications, CRM, ERP, e-learning and collaborative computing. Forthcoming research from Nucleus includes studies on maximizing returns from ERP, end-user case studies on enterprise technologies from Lawson, BEA and Microsoft, and a major report on the ROI end-users have achieved using Siebel's CRM tools.