Suppliers unite to prove value of IT spending

Some of the world's leading IT suppliers have joined forces with a group of US academics in a bid to prove that technology...

Some of the world's leading IT suppliers have joined forces with a group of US academics to prove that technology investment can deliver real returns.

Microsoft, Accenture, BT, Cisco Systems, Hewlett-Packard, Intel, SAP and Xerox have created the Information Work Productivity Council, a research centre at the Massachusetts Institute of Technology's Sloan school of management.

With European corporate IT spending levels stagnant and spending in the US falling in 2001 and 2002, the enterprise software industry is anxious to develop ways of justifying investment in its products.

Erik Brynjolfsson, professor of management at the MIT Sloan School, who will head the new centre, likens his quest to the early 20th century development of manufacturing automation.

“In the industrial era, researchers and executives developed scientific management principles to improve the productivity of their factory workers," said Brynjolfsson.

"Today, success depends on developing new practices to increase the productivity of information workers.”

Brynjolfsson was keen to emphasise the importance of business process re-engineering and to answer those who question the overall impact on technology investment.

“The productivity benefits of IT spending alone are relatively modest compared with those that can be achieved when IT solutions are combined with innovative changes in work organisation,” he insisted.

The Information Work Productivity Centre promises to examine business processes and enabling technologies used by successful organisations and create a standard methodology for measuring and increasing information work productivity.

This is crucial, said Danny Garvey, vice-president of BT Global Services.

“Despite current technology innovations most companies are not achieving their fullest potential. The centre will play a critical role in providing insight into where disconnects exist between technology and business processes," he said.

In a bid to head off criticism that the suppliers funding the centre may have undue influence over the research, an MIT representative insisted the organisation would have "complete academic independence in determining the research methods and results, which will be shared with the public".

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