We asked CIOs to rate the factors affecting the success of IT within their organisation, and found that many still feel their firms lack the processes, understanding, training and business-wide support to maximise the value of IT investment
Thirty per cent of UK IT directors feel they are struggling to demonstrate the business value of IT in their organisations. They feel that their boards do not understand the importance of IT to the business, end-users are insufficiently trained, and integration of business processes with IT is inadequate, according to Computer Weekly’s inaugural CIO Index.
With responses from more than 100 of the UK’s most senior IT management, the research demonstrates the mood at the top of IT departments in UK businesses.
Nearly all IT directors report that IT is providing more business value this year than last year, and they expect the trend to continue. However, 30% of IT directors feel it is hard to demonstrate that value to their colleagues in other business departments.
Furthermore, many CIOs feel their organisation lacks the processes, understanding, training and business-wide support to maximise the value of IT investment.
Buy-in from the board is one key precondition for IT project and programme success, but 24% of IT directors surveyed consider that their board does not understand the value of IT to the business, and 29% do not feel sufficiently empowered by their board.
More positively, 35% of IT heads agree strongly that their board understands the importance of IT, and 33% agree strongly that they feel sufficiently empowered.
To achieve full value from IT, an organisation’s IT systems need to align and integrate with its business processes. But 29% of CIOs said that their IT systems still do not integrate well with business processes. Only 19% of respondents were fully confident that they had IT and business integration right.
Communication with the business is a major management challenge for most IT directors, and the good news is that 90% said overall communications between IT and the business were improving.
But close contact at all levels between IT staff and their business counterparts is essential to unlocking business value, and this is still not happening in many cases. In 35% of organisations, IT directors feel end-users do not regularly advise the IT staff of developing requirements. Also troubling is that just 12% of CIOs agree strongly that end-users are sufficiently trained to use the systems effectively.
Despite the continued trend to outsource IT, particularly offshore, there is strong evidence that IT directors remain uncertain about the value of this strategy. Of those surveyed, 75% say that outsourcing has not provided the expected benefits.
And the prevailing mood at the top of IT departments suggests suppliers could provide better value. Although 90% agree that their relationship with IT suppliers is broadly satisfactory, 47% of IT directors see no movement on better product interoperability, and 67% do not see IT suppliers becoming any more accommodating on software licences.
However, the survey also reveals that 72% of IT directors believe that third-party software has improved over a three-year period.
Security and business continuity are a major concern for IT directors, particularly in the supply chain, and 66% of IT directors feel that security is not adequately funded.
Regarding business continuity, 36% of CIOs said that their business continuity plans were not robust, and 46% do not think that their supply chain’s business continuity plans are robust.
Despite the limitations and the challenges to be overcome, IT directors still overwhelmingly (97%) believe that they deliver a reliable service overall, although 38% have some reservations.
Some 91% believe that their own systems are robust and scalable, and 89% foresee IT management getting onto a more professional footing. This shows that the current IT professionalism initiatives spearheaded by the BCS, the National Computing Centre and suppliers group Intellect, are in tune with the mood of many IT directors.
Overall – and despite many feeling they struggle to demonstrate the value of their work to the business at large – senior IT professionals continue to be optimistic that they are improving the projects and services IT departments offer.
In April, Computer Weekly initiated a confidential online survey of IT directors in the Computer Weekly 500 Club. The research was conducted by our parent company Reed Business Information’s market research department, strictly adhering to the Market Research Society’s code of conduct.
Respondents graded their replies to a statement according to four categories: agree strongly, agree slightly, disagree slightly and disagree strongly.
The survey resulted in 127 completed questionnaires, and an additional 13 partially completed.
Computer Weekly’s CIO Index will be carried out quarterly and will provide analysis of key metrics for IT expenditure, technology adoption and business readiness.
Improving alignment of technology and business strategy
Influencing and managing IT and business alignment is one of the major management challenges for IT directors. Computer Weekly research identified the following best practice.
Improve communications Communication is a two-way process. Put a structure in place for effective communication between IT and the business at all levels. Make sure end-users advise IT of developing requirements and establish a process for regular contact with end-users, rather than only talking to them when there is a problem.
Get board-level understanding Communicate the business value that you have identified using the language of your business, and network closely with your business colleagues to understand their agenda and priorities.
Business continuity plans Be bold in ensuring that the business is aware of its responsibility to set the priority levels for continuity plans, but at the same time work closely with the business to ensure there is understanding and agreement about the scale and nature of risks.
End-user training Build in end-user training from the start of projects and keep that as an agenda item in all project meetings with the business. However good the system, an IT implementation will fail if the end-users are unable to use systems properly.
Demonstrate business value from IT Make sure that you communicate the business value of systems widely throughout the organisation – for example, through internal newsletters or an intranet – and on terms that the business understands. Enter successful projects for awards to get your success formally acknowledged outside your organisation. Work with the public relations department on this.
Data quality Query all data and do not accept poor quality data in your systems.
Software licences Work through user groups to ensure a fair deal on licensing, as well as other issues such as product interoperability or third-party software quality.