How do organizations make purchasing decisions?

How do organizations make purchasing decisions?

Summary: I was chatting with a neighbor a few days ago and the topic of how organizations actually select technology came up. That's an interesting area, one that my team at IDC often probed using various demand-side research tools.

SHARE:
TOPICS: CXO
6

I was chatting with a neighbor a few days ago and the topic of how organizations actually select technology came up. That's an interesting area, one that my team at IDC often probed using various demand-side research tools. In the end, it is clear that in commercial organizations (as opposed to academic or governmental organizations) often purchase emotionally rather than logically. Have you noticed this? Here are some points that came up during the lively conversation:

  • For the most part, purchasing decision makers have already made a choice before they bring in consultants, analysts and other influencers. Their choice was driven by something they read, what a golfing/tennis/insert your own favorite sport here buddy just did or what a recent business jounal said was the hot technology of the decade. These decision makers typically seek out someone that agrees with their pre-made decision and then purchase a report, an executive advisory session or something of the sort. This way, if higher levels of management ask why a certain product or service was acquired, it will appear if a carefully planned process was followed.
  • Very few organizations have taken the time to come to grips with what they're currently doing with technology, what their plans are for the future, and then developed a pragmatic architecture that will be the foundation of all future purchases.
  • Many companies start with a product and flesh out their ideas from there. I believe it was Abraham Maslow who said "If the only tool you have is a hammer, you tend to see every problem as a nail."

This behavior tends to lead organizations to incorporate the "Golden Rules of IT" into everything they do even if it gets in the way of future growth.

Can you add thoughts to this list?

Topic: CXO

About

Daniel Kusnetzky, a reformed software engineer and product manager, founded Kusnetzky Group LLC in 2006. He's literally written the book on virtualization and often comments on cloud computing, mobility and systems software. In his spare time, he's also the managing partner of Lux Sonus LLC, an investment firm.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

6 comments
Log in or register to join the discussion
  • Choices are made to maintain the persons position in the organization. They

    want to be the person that knows the most, and do not want to be shown up by others. That means they will pick what THEY know best, not what is best for the company. They also very much like decisions where someone else is to blame if things do not work out, thus the high priced consultants that can take the blame if it does not work out, and tell you what you want to hear. The consultants are high priced fall guys that have nothing to lose, other than maybe not getting future consulting jobs with this one particular company.

    So, companies really do need to find out ways to keep pointing fingers and punishing people when project go bad. People just waste company money on high priced consultants that are pre-programmed to design reports saying what you ask them to say, and no effort really gets put into figure out what is best. You need to eliminate the mid-level managers, and let the young kids go at it and really figure out what is best.
    DonnieBoy
  • RE: How do organizations make purchasing decisions?

    If the grunt workers were polled on a regular basis, they could give input on the kind of technology needed to get the jobs done efficiently. The ones making the purchasing decisions go by what was discussed on the golf course and the 'keep up with the Joneses' mentality.
    JWG1948@...
  • RE: How do organizations make purchasing decisions?

    paraben<a href="http://www.vipsexshop.com.br">sex shop</a>s por mais esse pos<a href="http://www.belasexshop.com">sex shop</a>t.
    vipsexshop
  • RE: How do organizations make purchasing decisions?

    adorei esse site! mto b<b><a href="http://www.vipsexshopatacado.com.br">atacado sex shop</a></b>om!
    eltonce
  • RE: How do organizations make purchasing decisions?

    Where does Idaho rank? We have been living in Montana for the past 5 years and I am not suprised to find it #3 on the "worst" list. Considering a<a href=http://www.hipersexshop.com.br>sex shop</a>move to Idaho to escapthe high cost of living a low income in MT. There may not be a sales tax here but they get you if you own property!
    hipersex
  • RE: How do organizations make purchasing decisions?

    If you need more traffic to your website check out the website in my name. It really helped me and i think it can help your website.


    <a href="http://www.ictmentors.com/">organic seo service</a>
    sher.afgan