Many CIOs in France, Germany and UK are cutting IT costs without
a long-term view of how to help the business
innovate out of the recession.
IT directors and CIOs unable to help organisations see their way
through the recession using IT have a poor link with the business,
according to a survey of 300 IT departments conducted by Loudhouse
for software management company BMC.
The survey found that over 40% of companies have not yet begun
to deal with the impact of the recession. CIOs in such businesses
were much less likely to streamline their IT operations, the study
found.
They also have fundamentally lower expectations about the IT
department's ability to help other parts of the business to drive
down costs.
The survey found a quarter of businesses were using IT to help
them innovate through the recession. Of these, 41% focused on IT
automation as a route to cost cutting. These were more likely to
re-invest IT savings to further enhance business efficiency.
"The lesson we can draw here is that companies cannot simply
save their way back to recovery," said Alexander Grous, a
researcher at the Centre for Economic Performance (CEP) at the
London School of Economics, who has studied the link between IT
investment and business performance extensively. "Innovation
deficits are extremely hard to redress. Organisations that recover
best are those investing in areas of the business that can deliver
long-term returns, such as IT."
Chris Rixon, director of field marketing at BMC, said IT
departments that focus on cost cutting goals have the weakest link
with the business: "The IT industry needs to educate companies
about how technology can drive out cost," he said.