Business/IT management rift diminishing – study


21 Feb 2005

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The historic rift that exists between the boardroom and the IT department is understood to be diminishing as both groups are starting to agree on the challenges they face in boosting productivity, a study indicates. The study also found that when business and IT goals are not aligned, IT projects are more likely to fail.

The Accenture study of 300 Irish and UK general business managers and IT managers based in large companies aimed to examine the differences between the two groups’ beliefs regarding the impact and importance of IT. The findings, Accenture believes, echoes recent forecasts by IT industry analysts Gartner that anticipates a 2.5pc increase in global IT spending in 2005.

The two groups agreed on the challenges they face in improving productivity. Gaining synergies across business units was identified as the most significant challenge by nearly two thirds of each group (64pc of business managers and 61pc of IT managers). Nearly half of each group (47pc of business managers and 40pc of IT managers) identified increasing business ownership of major IT projects as a challenge.

Additionally, the majority of business managers (83pc) and IT managers (70pc) view simplifying business processes as a major factor in productivity gains and 68pc of business managers and 63pc of IT managers view simplifying IT systems as a major factor.

Although the study found that a large proportion of both groups (56pc of business managers and 38pc of IT managers) believe that IT is under-delivering against investments, the study’s findings indicate that the historic tension between business managers and their IT counterparts is diminishing. For example, both groups of executives (84pc of business managers and 76pc of IT managers) indicated that they believe that the better use of IT has been the principle driver of productivity gains over the past three years.

“Fortunately, business and IT managers are beginning to get over the ‘us vs them’ mentality,” said Andrew Morlet, head of Accenture’s strategic IT effectiveness practice in the UK. “The strong agreement between business and IT management on the nature of the challenge is encouraging and supports our view that substantial IT-based productivity gains are possible.”

In fact, the study found that when business and IT goals are not aligned, IT projects are more likely to fail. For example, one third of executives (35pc of business managers and 27pc of IT managers) reported IT project failure rates of 41pc to 70pc. Of these executives, only 17pc (for both business managers and IT managers) consider alignment of business and IT goals in their companies to be “strong” or “totally aligned.”

“Aligning IT strategies to business objectives is one of the most fundamental factors for deriving value from technology,” said Morlet. “High-performing companies achieve this alignment through a variety of management practices and as a result can substantially outperform those that don’t.”

By John Kennedy