Cash-starved IT departments struggling to fill strategic role in business

Cash-starved IT departments struggling to fill strategic role in business

A lack of investment is preventing IT from delivering crucial efficiencies

The lingering economic downturn is resulting in companies not gaining the long-term benefits of IT investment, according to analysis from Modis International [Modis], a global leader in IT recruitment.

The poll of 250 IT leaders finds that continuing economic volatility is making organisations consider deferring investment in IT upgrades. As a result, postponed projects and dated systems are creating inefficiencies in front-line delivery. Over half of IT decision-makers name lack of budget as a primary barrier to the implementation of their IT strategy.

A gap exists between the recognition that IT can drive business efficiencies and especially top-line growth, and a reluctance to invest in making it happen. 43% of those polled stated that their IT spend is aimed at achieving time and efficiency savings – up from 39% in 2010. At the same time, 51% say that budget restrictions are impeding the implementation of IT strategies, preventing such savings being realised.

Cost consciousness is the number one driver of change in the IT function, cited by 46% of respondents. This is not only reducing innovation, but 29% of respondents also suggest limited resources are hampering their ability to meet day-to-day service demands.

Jim Albert, Managing Director, Modis said, “As the UK continues to operate against a background of economic turmoil, it is no surprise that IT departments are increasingly being caught in a tug-of-war between cutting costs and delivering strategic business value.”

“In 2011, businesses have become more aware of IT’s potential to enhance business efficiency. However, most organisations are focusing on keeping business-as-usual activities going rather than looking at future innovations and developments. A change in mindset is still needed among some financial directors to risk upfront investment for longer term gains.”

The findings are from the State of the IT Market Report 2011, a survey of 250 senior IT decision makers (predominantly Directors and Heads of IT) from UK businesses of varying sizes and from a range of sectors. Respondents were asked a series of questions to gauge their view of the changing role of IT within organisations.