What's in a name?
Plenty, it seems, especially in tougher economic times. When the chips are down and almost every company in the market is clocking negative growth, some tech buyers rely on reputation to decide which vendor to invest in.
A company's financial stability is typically a key consideration in most buyers' decision-making process--nobody wants to be left stranded in the middle of a major ERP implementation when the software vendor files for Chapter 11. But, in a market climate where even its competitors are bleeding cash, brand name is the next best gauge.
YCH Group CIO James Loo, for instance, relies more heavily on a tech vendor's reputation when he needs to make decisions on IT investments that are more strategic for his company because these usually require more specialized knowledge.
And for Paul Jung, Visa's regional head of emerging products and technology, bad news is more significant than good news, where vendors with tarnished reputation stand out like a sore thumb. "A company's reputation definitely has big influence on buyers' decision [and] for me, a bad reputation will have a bigger influence than a good one," Jung said.
For some businesses, it's also about relationship. At a CIO summit this week, delegates noted that the credit crisis offers some consolation because they're now in a better position to negotiate, or renegotiate, service contracts to get better deals from the vendors. It is, after all, now a buyer's market.
But, one CIO said that doesn't always translate to real cost savings. "You can threaten to switch vendors if they don't give you a better deal, but that doesn't guarantee you'll get the same level of service if you change vendors." He noted that it's probably more cost effective to stick with the same vendors because they're already familiar with your business and understand the level of service you'll need from them. Establishing new relationships also requires effort and time before both parties reach a comfort level, he added.
It's clear that several factors need to be considered before tech buyers make their final selection. To help businesses make well-formed IT buying decisions, ZDNet Asia this week unveiled its latest Top Tech 50 Index, which identifies players in the tech industry that have performed well financially and shown commitment to the Asian market.
Do check out our special report on this, including highlights on the Top 10 companies that achieved the highest year-on-year growth in terms of revenue and net income.