Cautiously optimistic.
Those two words sum up the outlook for technology spending at insurers in 2004. It may not sound like much, but after a long stretch of flat budgets, even guarded optimism is reason for some celebration.
We are starting to see an increased willingness to pursue projects, says Paul McDonnell, senior vice president and insurance segment leader at Bearing- Point. Based on the past two to three years, there is a bit of pent-up demand, and we believe that 04 is the year things might start to improve.
Just how big that improvement will be is open to debate (see Cautious Optimism Defined, p. 19), but dont expect a return to the heady days of the 90s any time soon. Instead, count on the budgetary discipline learned over the past years to have long-lasting impact.
The biggest part of that impact will be a continued focus on the acronyms TCO and ROI, which are key to perhaps the most important acronym of all (for stock companies, at least), ROE. Also important is the desire of managementand stockholdersto achieve a return quickly.
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