E-commerce a waste of money, say IT managers

22 Jan 2003

IT managers in Ireland say that over the past five years they’ve wasted more money on e-commerce and trying to integrate their systems than on any other areas of IT. This is a key finding of the latest Pressure Point Index (PPI III) survey from Synstar.

According to 32pc of Irish IT managers questioned, when it comes to wasteful IT expenditure, e-commerce and systems integration (30pc) are the biggest culprits. 25pc cite desktop maintenance, 23pc hardware and 20pc say customer relationship (CRM) projects have wasted most cash.

When it comes to technology investment, 31pc of Irish IT managers say that their company puts less than 5pc of operating profit back into IT expenditure. 47pc say it is between 5 and 10pc and 22pc say 10-25pc. No company re-invests more than 25pc in IT.

In addition, 58pc of Irish IT managers don’t believe their company spends enough on IT, 40pc think their company spends the right amount and only 2pc say it spends too much.

Despite their admission that money has been badly spent, few Irish IT managers feel IT budgets should be reduced.

Encouragingly 96pc of the Irish IT managers questioned say that IT purchases should be made to achieve business benefit. Only 4pc of Irish IT managers say they purchase IT simply to access the latest technologies, compared to 37pc in France and 28pc in Germany.

Ian Byrne, head of Synstar Ireland, commented: “It seems that Ireland’s IT managers can see where they are leaking money and are wise to consider outsourcing certain functions. For example by outsourcing their desktop infrastructure support – which according to our survey 59pc of Ireland’s IT managers would like to do – they can increase the lifespan of their IT equipment and reduce wastage.”

Byrne, continued: “It is encouraging that IT managers in Ireland have learnt more from their past mistakes than some of their European counterparts – and won’t make an investment in IT unless it can deliver a business benefit or increased security and stability. This is increasingly important if Ireland’s IT managers are to be taken more seriously by their board. Every IT purchase must either bolster their current IT infrastructure or deliver ROI [return on investment].”

The PPI III is the latest in an ongoing piece of research designed to monitor pressure on IT managers across Europe. The PPI III tracks change since the last study was undertaken in the autumn 2001.

Synstar is an IT services provider with facilities in eight European countries, including a business recovery centre in Dublin.

By Brian Skelly