Sceptical boardrooms fed up with underperforming IT departments are set to make 2005 a tough year for senior IT managers with increased pressure to cut costs and deliver tangible benefits, according to a new survey.
The second annual ICT spend survey sponsored by Telewest Business and carried out by the Economist Intelligence Unit found that the climate for IT investment remains cautious, with 57 per cent of respondents saying IT budgets will be cut or stay the same as last year.
CIOs, CEOs, CFOs and senior managers in 125 private and public sector organisations in the UK were polled for the survey, which showed a disparity between how CEOs and CIOs see their IT departments.
Almost two-thirds (63 percent) of CEOs said their IT "underperforms" compared to 39 percent of CIOs. A third of respondents also said their ICT networks are not cost effective or easy to use.
In response, 41 percent of CIOs said that business requirements change faster than the IT department can respond.
Cost-cutting remains a top priority for many CIOs in 2005 but the survey found risk management, related to compliance legislation, and customer service projects have risen up the agenda.
The trend towards outsourcing remains strong, particularly in the public sector with almost a fifth (19 percent) saying that at least a half of their ICT infrastructure will managed by a third party over the next two years.
Gareth Lofthouse, European director for executive services at the Economist Intelligence Unit, said the climate remains cautious and that CFOs continue to exert a tight grip on IT spending.
"I do not think there has ever been a more challenging time for the CIO. There is a more sceptical view of IT [from the boardroom]. The challenge for CIOs is how to demonstrate that IT delivers value to the business."
Christopher Small, director of public sector at Telewest Business, said part of the problem is that strategy decisions in many organisations are still made above the CIO or IT director's head.
"IT is still seen as a cost centre and not an enabler," he said.
Talkback
The biggest problem I have seen with execs in SMEs is that they don't listen to their IT staff, believing their own views, ideas and flowery imaginations are more accurate and possible than the realistic views of the real world techies, the people who end up having to implement poorly thought out systems.
Senior management and executives, therefore, seldom give IT departments and staff the support they need to make a positive difference.
Another problem is the lack of computer literacy in staff. Basic tasks like logging on, changing passwords, changing printers, et cetera seem to be completely beyond some staff.
ICT is an enabling technology. It should be central to the vast majority of businesses and recognised as such. But like any tool, you only get the best out of it if you learn to use it properly. If you don't then it's a disabling technology. Companies need to learn and enforce this. But they don't.
"It's only IT, IT don't matter" is the mantra of so many managers and executives. But when their e-mail or laptop is down the attitude is oh-so different.
"Be nice to this geek - you will need him one day" should be the mantra. Support your IT staff by giving them the working environment they will perform best in. Get your other staff IT literate so minimizing idiot calls. That will make a difference.
You get out of IT what you put in. Most management and executives put nothing in so deserve to get nothing out.
Apparently “clueless” ICT network users have no difficulty driving themselves to work every day. If they can handle such a complex machine as a car without difficulty, perhaps the problem they have “logging on” to the ICT network lies in the network - just as chief executives say.
If the automobile had followed the same development cycle as the computer:
. You would have to spend 10 minutes every morning trying to remember your password before you were allowed to open the door;
. If you made three incorrect guesses at your password, your car would be repossessed;
. Some cars would have the accelerator pedal on the right of the brake and others on the left;
. If you drove through a red-light district, your boss would be informed;
. Your car would only drive to certain locations (other locations will be added in the next release);
Here we go again. Yep, You have it, the board see the network running smoothly, don't have many downtimes, and the IT staff seem to be twiddling their thumbs. But Hey, thats ok, we will get rid of some of them, if not all, lets outsource. Along come matey from indonesia, watford, amsterdam, yes we can manage remotely. UNTILL that fatefull day when a very important switch/router/hub falls flat on its back, 12 hours later, a third party engineer attends site, spend 8 hours 'fixing' the problem. Result, Company losses a couple of hundred thousand profit. Company recoups by laying off staff. Company has another network problem, company waits for 12 hours before engineer arrives, engineer takes 8 hours to repair fault, result, another couple of hundred thousand profit lost. Company has to lay off more staff to compensate. Now company has a staff shortage, orders being missed/delayed, more layoffs. Company goes into liquidation.
This may sound like a bit of a fairy tale, but unfortuantly the Man/Woman or Women/Men at the top do not understand, if the network is stable, the network staff are invariably doing their jobs, seemlessly.