IT is invited back into the boardroom as analysts acknowledge its business value

Stock market analysts take an interest in IT spending.

Stock market analysts take an interest in IT spending

IT departments seeking influence and support at board level now have a new group of allies in stock market analysts, who are increasingly interested in companies' IT spending.

About 55% of analysts want IT people to be involved in company briefings, according to UK research by Hewlett-Packard, which was presented at a recent conference of the BCS Project Management Specialist Group and the Programme Management Special Interest Group.

In addition, 54% of analysts said they would support IT spending if it were designed to improve efficiency, even if shareholders wanted cost savings.

More than 46% said companies should be obliged to give more information on IT spending and system performance, although they are against any formal regulation.

All the analysts agreed that IT has a role in enhancing shareholder value and company performance, with 69% agreeing strongly.

IT certainly needs such support, Hugh Barton, a director of Hewlett-Packard's services arm, told the BCS conference. "Top executives now understand the value of IT, but things have worked against us recently," he said.

"A lot of senior executives feel betrayed by the y2K issue, enterprise resource planning, the dotcom boom and bust and now customer relationship management. These have all undermined trust, confidence and the relationship with the business.

"A disturbing result is that many IT directors are reporting to the finance director. This raises concerns about IT being viewed as a cost centre, judged by what it takes out of the business, not by the value it provides."

IT was being "pushed down the pecking order," said Barton. Increasing demands from users and budget constraints meant that "performance had to be coaxed from complex, inadequate legacy systems, creating an inflexible operating environment".

He said the City's view of the importance of IT to share value meant IT needed more stringent governance.

"Shareholder value is very different to what we usually talk about in IT project delivery," he said. "Investors now become part of the constituent group, as well as the employees, and they need to know what is driving IT investments and that sound business judgements are being made."

This should not mean obsession with the lowest cost, Barton said. "IT governance should never risk undermining entrepreneurialism, creativity or judicious risk taking. If you risk nothing you get nothing in return."

IT governance should mean building or rebuilding trust and relationships with the business and ensuring IT provides business value.

This would allow IT to move from "the blue collar with the oily rag making the infrastructure work" to being involved in discussions about developing the infrastructure.

Barton reported there was "a huge amount of interest in IT governance, but in pockets. There is a need to create a critical mass".

He said the City's growing interest in IT spending and impact, as shown in Hewlett-Packard's research, would get business executives involved.

"If applied appropriately, IT governance gets IT back at the top table," Barton said.



Inside the BCS

The BCS Information Systems Examinations Board has launched a combined certificate module in its Business Systems Development diplomas scheme in change management, configuration management and release management.

The new certificate is the 22nd module and is available to those taking the diplomas in systems analysis and design, the SSADM4+ development method or rapid application development. The 18-hour course ends with a one-hour exam with a multiple-choice section and a case study.

The Business Systems Development diploma scheme also offers diplomas in business analysis and data management with five certificate modules - each a valuable qualification.

www.bcs.org/iseb

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